Strategic Management of the popular BBK Electronics company One plus

1. STRATEGIC MANAGEMENT
PRESENTATION
(SMARTPHONE INDUSTRY)
Premal Shrivastava

2. INTRODUCTION TO THE INDUSTRY
● India is the popular destination for the smartphone companies. The number of smartphone users in India is expected to increase to
442 million in 2022.
● India is ranked second on the basis of average time spent of mobile web across Asia. The combination of very high sales volume and
the average customer behaviour make India as the attractive market.
● The mobile market is very competitive and the international players are facing strong competition from local market and creating
difficulty for the manufacturers to retain market share.
● Chinese vendors are further strengthening their positions in the smartphone category across India with the collective share of China-
based vendors reaching 53 per cent in 2017 from 34 per cent a year ago. The volume of India's smartphone shipments was close to
140 million in 2018.
SOURCE: Smartphone market in India. (2020). Retrieved 5 March 2020, from
https://www.statista.com/topics/4600/smartphone-amarket-in-india/

3. INTRODUCTION TO OnePlus
● One Plus Technology (Shenzhen) Co., Ltd., commonly referred to as OnePlus, is a Chinese smartphone manufacturer, which is
based in Shenzhen, Guangdong. It was founded by Pete Lau (CEO) and Carl Pei in December 2013.
● The company officially serves 34 countries and regions around the world as of July 2018. They have released numerous phones,
amongst other products.
● It is currently majority owned by Oppo as its only shareholder, which is a subsidiary of BBK Electronics along with Oppo,
Realme and Vivo.
● OnePlus is known for its very distinctive slogan: "Never Settle", included in some of their wallpapers, and is a very big role in
the company. The company's main goal was to design a smartphone that would balance high-end quality with a lower price than
other phones in its class, believing that users would "Never Settle" for the lower-quality devices produced by other companies.
SOURCE: Never Settle - OnePlus.com. (2020). Retrieved 5 March 2020, from https://www.oneplus.in/

4. BUSINESS GROUP AFFILIATIONS
1. Oneplus is a subsidiary company associated with Oppo and BBK Electronics, which serve as its parent company
2. Oppo has around 60% stake in Oneplus, so it makes Oneplus a subsidiary of Oppo.
3. OnePlus has the highest global profile of any of the BBK brands.
4. OnePlus primarily targets online sales via platforms like Amazon, which has helped BBK enter European and US
markets.
SOURCE: Murphy, M. (2020). You’ve almost certainly not heard of the world’s third-largest smartphone company.
Retrieved 5 March 2020, from https://qz.com/1215263/who-makes-oppo-vivo-oneplus-and-imoo-smartphones-the-
same-company/

5. PRODUCT PORTFOLIO
OnePlus
Phone Cases and
Protection
Power and
Cables
TV
1. OnePlus 7
2. OnePlus 7T
3. OnePlus 7 Pro
4. OnePlus 7T Pro McLaren
5. OnePlus 6
6. OnePlus 6T

6. SOURCE: Smartphone industry pestel analysis . (2020). Retrieved 5 March 2020, from
https://notesmatic.com/2019/11/smartphone-industry-pestel-analysis-%EF%BB%BF/
POLITICAL ENVIRONMENT
•1. Huawei Ban depicts growing level
of regulation and political control in
the smartphone industry.
•2. The trade war between the US and
China is affecting nearly all the large
technology firms in the US and China.
SOCIAL ENVIRONMENT
1. Sociocultural factors are now a key
consideration in the area of business.
1.2. Customer Lifestyle and preferences
2.3. Large number of functions and
features in one device at minimised cost.
3.4. Level of convenience
TECHNOLOGICAL ENVIRONMENT
1.1. An important source of
competitive advantage for brands.
2.2. Research and development
3.3. Innovation is essential for growth in
sales and market share.
LEGAL ENVIRONMENT
1.Consumer privacy and data Security.
1.2. Focusing on compliance.
2.3. Labor laws, product quality laws,
environmental laws, Patent laws and some
other laws also affect smartphone firms.
PESTEL ANALYSIS
(INDUSTRY)

7. SOURCE: Figure 1 SWOT Analysis Strengths High Performance The OnePlus One phone
was. (2020). Retrieved 5 March 2020, from https://www.coursehero.com/file/p45th98/
STRENGTH
 1. Fastest growing smartphone company having
exclusive partnership with amazon.
2. Low cost premium smartphones with latest
technologies and high specifications.
3. Special platform Oxygen OS which sets
OnePlus apart from other smartphones.
4. Due to its affordable price, OnePlus Sold
30,000 units of OnePlus 2 in just 60 seconds.
WEAKNESS
1. Controversial Campaigns- The controversies
on the campaigns like “Smash the Past” and
“Ladies First” drew negative impact to the market.
2. Lack of Resources
3. Lack of Customer Experience- Inefficient
response time to customer’s issue as there we’re
only 53 authorized service centres globally.
OPPORTUNITIES
1.1. Target different customer segment.
2. Mainstream Advertising
3. Improved Marketing Communication
4. Broaden Geographical Market
THREATS
1. New Competitors - Smartphone market is
continuously growing. OnePlus should invest in
R&D to reinvent new products.
2. Newer Handsets
3. Distribution - The company should consider
growing big in terms of increasing their distribution
channel not only limited to online selling.
SWOT
ANALYSIS
(OnePlus)

8. ◦ ,
Threat of New Entrants
(High)
 Proprietary learning curve: High
investment in Product Development
 High capital requirements and
Economies of Scale
 Brand identity and brand switching
costs
Threat of substitute products
(Low)
 Low Buyer inclination to
substitute
 High switching costs
 High price-performance ration
(value)
Rivalry among existing
players
(High)
Industry growth: Intense
competition
High margins
Brand identity
Low-Medium Consumer’s churn
ratio
Bargaining power of buyers
(High)
 Presence of large number of
manufacturers with similar features.
 Increased price sensitivity:
 Presence of local companies with
low priced phones.
Bargaining power of supplier
(Moderate)
 Presence of large number of suppliers
with multiple opportunities.
 Moderate impact of inputs on cost or
differentiation
 Moderate switching costs of firms in
the industry
PORTER FIVE FORCES STRATEGY
(INDUSTRY)
SOURCE: Porter’s Five Forces – One+. (2020). Retrieved 5 March 2020, from
https://oneplusblogone.wordpress.com/category/porters-five-forces/

9. BUSINESS STRATEGIES
(FOCUS STRATEGY : Follows a mixed strategy including both Cost Leadership, and Product
differentiation)
1. Creating Buzz with Exclusivity
2. Clever Use Of Influencer Marketing
3. Leveraging on Word of Mouth
4. Less Expenditure on Traditional Marketing
5. A Quality Product
6. Maximally Utilizing an Hashtag (#NeverSettle)
7. Affordability of the Device
8. Online Sales with no Offline Store at the Beginning
9. Building Loyal Community Members (Red Cable Club)
SOURCE: Saxena, D., & Saxena, D. (2020). One Plus Marketing Strategies – 9 Big Takeaways - Super
Heuristics. Retrieved 5 March 2020, from https://www.superheuristics.com/one-plus-marketing-strategies/

10. 37.9
150
0
20
40
60
80
100
120
140
160
2016-17 2017-18
InCrores
BUSINESS PERFORMANCE
(REVENUE)
REVENUE Linear (REVENUE)
SOURCE: REGISTERAR OF COMPANIES (ROC)

11. 2016-17 2017-18
NET PROFIT 0.901 2.8
0.901
2.8
0
0.5
1
1.5
2
2.5
3
InCrores
BUSINESS PERFORMANCE
(NET PROFIT)
NET PROFIT Linear (NET PROFIT)
SOURCE: REGISTERAR OF COMPANIES (ROC)

12. GROWTH AND PROFITABILITY
Reason for drop in sales:
● Lengthening of the replacement
cycle of smartphones.
● Maturity of smartphone market
However, the smartphone market is expected to grow in 2020 with the expansion of 5G
devices SOURCE: Gartner &Gartner (2020). One Plus Growth ratings- Super Heuristics. Retrieved 5 March 2020,
from https://www.superheuristics.com/ One Plus Growth ratings- /

13. REVENUE OF SMARTPHONE
COMPANIES IN INDIA
*Revenue in Crore Rupees
SOURCE: REGISTERAR OF COMPANIES (ROC)

14. COMPETITOR ANALYSIS
OnePlus Apple Samsung Xiaomi Asus
Founded in 2013 1976 1938 2010 1989
First
Smartphone
OnePlus One(2014) iPhone(2007) Galaxy GT-i7500(2009) Xiaomi Mi 1 (2014) Zenfone series (2014)
Initial
differentiating
factor
Flagship Killer First to the
smartphone game
One of the first to ship
with Android
Subsidized prices by
selling digital content
Using well known and
established laptop
brand name
Strategy over
the years
1. Focussing on few
models /year
2. Slowly moving to
“true flagship territory”
3. Providing the
longest software
support among
androids
5. User community
1. Launching only
premium phones
2. Integrated
Ecosystem
3. Not comparing with
the rest
4. Introducing
comparatively
cheaper models
(iPhone 11) in face of
competition
1. Launching phones
in all price ranges
2. Galaxy S series
provide the most
balanced user exp
3. Reliable service
4. Increased freq of
new launches
1. Launching phones
in all price ranges
2. Selling through sub
brands (redmi, mi, mix,
poco) to cater to
different customers
3. Pricing lower than
competitors
1. Providing clean user
interface
2. Innovative features
(Zenfone 6 flip
camera)
3. Catering to gaming
community through
gaming centric
phones (Rog Phone)
Current Line up OnePlus 7T & 7TPro iPhone 11 Series Galaxy S20 Series, M
Series, A Series
Mi 10, Redmi K30
Series, Poco X2
Zenfone 6, ROG
Phone 2

15. COMPETITIVE ANALYSIS
SOURCE:Owler. (2020). Comparative Description – 10- smartphone companies. Retrieved 5 March 2020,
from https://www.owler.com/company/oneplus

16. COMPETITIVE ANALYSIS
SOURCE:Owler. (2020). Comparative Description – 10- smartphone companies. Retrieved 5 March 2020,
from https://www.owler.com/company/oneplus

17. RECOMMENDATIONS
 For the company –
1. The company should target different customer segments
2. Focus on Mainstream Advertising
3. Improve Marketing Communication
4. Broaden Geographical Market
 Product category –
1. Should focus on providing products with wireless charging, NFC (Near Field Communication), and IP68 Dust and water resistance.
2. The company should focus on providing better cameras with respect to competitors