A new market intelligence report says Chinese smartphone brand Honor managed to double its year-over-year sales in the second quarter, and copying iPhone features was one of the reasons for this success.
Honor was the only brand to increase its market share during the quarter, even though Apple fared better than all the other brands…
Search for counterpoint started with the bad news: the downward trend in smartphone sales seen in the first quarter worsened in the second quarter.
Smartphone sales in China were down 14.2% year-on-year in the second quarter of 2022, according to Counterpoint’s Market Pulse report. Volumes for the quarter were 12.6% below the level seen in the severe pandemic-affected first quarter of 2020, and less than half of the all-time high in the fourth quarter of 2016. The last time sales were below that period, it was almost ten years ago, in the fourth quarter of 2012. , when the iPhone 5 was introduced.
This is not surprising given the difficult economic conditions in China, as the country maintains its policy of ordering citywide shutdowns in response to a small number of positive COVID-19 tests.
China’s economy grew only 0.4% year-on-year in the second quarter of 2022, which is below market expectations of 0.8% to 1%. During this period, major cities in China, including the financial and manufacturing hub of Pan-Shanghai, suffered full or partial shutdowns. The hardest hit was the services sector, which fell into contractionary territory, falling from 4% year-on-year growth in the first quarter to 0.4% in the second quarter.
The biggest drop came in April consumer data, with total retail sales of consumer goods falling 11.1% year-on-year. Weak consumer sentiment, combined with high smartphone penetration in China, led to poor smartphone sales performance in the second quarter.
Honor more than doubled its sales year-over-year, growing 103%, and Counterpoint said two factors were at play. First, the company has many outlets in tier cities. two, which have been less affected by the closures than the larger ones.
Second, by copying functionality from the iPhone. These include facial recognition and 120Hz screens.
Despite the discouraging performance in Q2 2022, major Chinese OEMs continued their efforts to strengthen their positions in the high-end segment. HONOR and Xiaomi compared their high-end models to Apple by integrating several iPhone features […]
Major Chinese OEMs don’t have many options to break into the high-end segment dominated by Apple.
Honor describes the 120Hz ProMotion-style display as an innovation.
As an industry adopter and innovator, HONOR first combines LTPO 1~120Hz3 adaptive refresh rate technology and 1920Hz PWM dimming technology into a smartphone display, which has been applied in HONOR Magic4 Pro. This exclusive display can deliver a truly immersive experience with less power consumption and eye strain.
While Apple was not the first company to introduce this technology, it was its use in the iPhone that apparently made it a desirable feature.
Over the whole of the second quarter, Apple saw its sales fall by 5.8%. However, while everyone but Honor is experiencing declines ranging from 23% to 44%, Apple still managed to increase its market share slightly, from 14.1% to 15.5%. This was largely attributed to the 6.18 shopping fest, with Apple outperforming other brands and seeing much of its second-quarter sales in June.
Apple was apparently encouraged by the impact of the reduced prices on sales, as it then offered discounts on its official website for the very first time.