Smartphone maker Poco has managed to carve out a niche for itself despite growing under the aegis of Xiaomi. It has largely confined itself to the budget and mid-segment handsets. But this could change in 2023. Himanshu Tandon, Country Head of Poco India interacted with The Hindu’s Haider Ali Khan on the company’s plans in the country. Edited excerpts:
Edited excerpts:
Poco currently floats between the budget and mid-segment. Does it intend to go beyond, and move into the premium segment this year?
Himanshu Tandon: Right now, we have five series - C series which is under 10k [rupees], M series around 10k to 12k, M Pro series around 15k, and the next series between 20k to 25k, and F series around 30k.
This year, basis the demand, we are exploring whether we should be venturing into FY Pro or FY GT kind of models moving forward, but again, we are seeing some demand normalisation because of the inflationary pressures.
We certainly want to venture into this high-end category between, let’s say 30k to 40k price bracket, but we will take an informed decision versus the market demand.
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Don’t you think this will create a conflict of interest for your sister brands and confuse buyers?
HT: Poco’s target group (TG) is around 18 to 24 years, mostly college-goers, whereas our sister brand is mostly early jobbers. Considering their preferences, we are still maintaining the price-to-performance ratio.
We are still focusing more on performance because that is the demand of our TG. The design language of Poco is different from its sister brand. First of all, the TG difference. Secondly, our price-to-performance emphasis, and then our design language. These are the three features through which we differentiate from our sister brand as well as from the other competitors in the market.
The rising average selling price (ASP) is becoming worrisome for brands. Does it also affect Poco and its TG?
HT: From ASP point of view, it’s not hurting Poco. With this inflationary pressure and rupee depreciation, we see some demand contraction under 10k because the lower strata is getting impacted more.
With the recent launches, an opportune segment is growing in the 20k to 30k price bracket where we will see a lot of launches, which will in fact drive the ASP even higher. Overall, with demand normalisation under 10k segment, I think the ASP will in fact increase for the brands.
The inflation is also hurting the 5G adoption. Do you agree?
HT: Yeah. From overall industry perspective, we’re considering this inflationary pressure. We see some normalisation in terms of overall demand of smartphones. Adoption from 4G to 5G is the only area where we can see that the market can grow because of the rapid expansion of 5G by operators.
A lot of people are looking out for 5G devices. This upgrade from 4G to 5G will provide an opportunity for the smartphone market to basically increase its base.
People are preferring more 5G devices at a lower price range. 5G as a hygiene point is shifting, which basically gives cue to a lot of brands to launch even more 5G devices.
What would be your focus going forward - more 5G phones?
HT: From the Poco perspective, we have taken this conscious call that all newly launched products above a certain price point, will be 5G devices.
It is very difficult to bring a good quality 5G device that matches all the hygiene parameters around 10k, but all the brands are working towards it. At around 12k, we will be launching 5G devices.
What is going to be your market strategy since Poco has been an online-only brand?
HT: Till now, we are an online brand, focusing only on the online channel. We are a significant player on Flipkart, which contributes around 65% of the entire online sales. We are a very dominant player there, but considering our growth, we will be venturing into the offline space.
Would it be a brick-and-mortar model or a different one?
HT: For offline, we will be appointing direct distributors in the top 10 cities and then these distributors will be giving stock to the multi brand outlets. Since we are an online focused brand, this will be a gradual approach. We will not be spreading ourselves in the entire country. It will be a gradual, city by city approach.
How did Hardik Pandya come onboard as Poco’s new brand ambassador?
HT: The 18 to 24 [years age group] is our target audience who loves music, movies, and sports. We were looking for a person who is rebellious, challenges the status quo, and goes with the ethos of Poco. He will be the new brand ambassador for the entire brand, and not just any series.
Do you intend to venture into other categories like wearables, smart TVs?
HT: This is the year we are finally venturing into non-mobile categories. So, we are in the final stages of two, three categories. This year, maybe H1, will be the opportune time to get into non-mobile categories.
We are creating some India specific products that are suited for our audience. Poco Global already ventured into non-mobile categories last year, but we took a conscious call that we will make India-specific products.
