Chinese smartphone upstart Realme is looking to enter international markets with its flagship phones. But it plays in the mid-price segment of the market, where it faces stiff competition from rivals like Xiaomi.
BARCELONA, Spain – Chinese smartphone maker Realme wants to stand out in the crowded space of mid-range devices. So on Tuesday, it launched a smartphone that it claims can be fully charged in 9 minutes and 30 seconds.
The company unveiled its GT3 smartphone at the Mobile World Congress in Barcelona, the world’s largest mobile trade show. It is looking to grow its business outside of China and joins a number of Chinese suppliers looking to target overseas markets.
The GT3 starts at $649, making it a very competitive segment where Realme will compete with Chinese rivals such as Xiaomi and Oppo, which offer affordable devices with high specs.
“Realme is chasing the low-margin market segment by offering highly competitively priced products targeting value-seekers,” Ben Wood, head of research at CCS Insight, told CNBC via email.
“However, this is an extremely difficult part of the market to play. Low single-digit margins can disappear if the dollar moves quickly, component prices rise, or shipping costs jump — all of which are headwinds that Realme has faced.”
In an attempt to expand overseas, the company launched its GT2 and GT2 Pro flagship phones in Europe last year. But times have been tough, with the global smartphone market in 2022 set to be the worst since 2013 in terms of shipments.
Sky Lee, CEO of Realme, told CNBC last year that the company plans to sell 85 million phones worldwide in 2022. The company did not release updated figures. Market research company Strategy Analytics estimates that the company shipped 52 million smartphones, down 20% from last year. The shipment numbers show the number of devices Realme sends to retailers for sale and do not equal sales, but are an indication of demand for the company’s phones.
According to Counterpoint Research, in the fourth quarter of 2022, Realme’s shipments to Europe, a key region it is targeting for international expansion, fell by 44% year-on-year. Its share in the European market fell to 4% from 6% in the same period last year.
“Realme’s biggest challenges in Europe and the U.S. in 2023 include the lack of retail from powerful operators like Vodafone” and “the perception of the brand as less prestigious than Apple or Samsung,” Neil Mawston, chief executive of Strategy Analytics, told CNBC via email.