Between 2017 and 2013, the number of smartphone brands out there has dropped by an astounding 500 companies.
In 2017, more than 700 different brands were competing against each other in the smartphone market. Now, just six years later, there are currently only around 250 active smartphone brands, according to Counterpoint’s Global Handset Model Sales Tracker.
"A maturing user base, improving device quality, longer replacement cycles, economic headwinds, supply-chain bottlenecks and major technological transitions such as 4G to 5G have gradually whittled down the number of active brands and their volumes over the years," Counterpoint says.
Seven hundred might seem like a lot of smartphone brands to folks in the United States who are used to just a few brands duking it out. However, in many other countries, local brands can offer less expensive and different options for shoppers.
The pandemic hit those smaller local brands hard, as did the component shortages that followed, resulting in a lot of those businesses either going out of business or exiting the smartphone market. Counterpoint also notes that smaller brands aren’t able to invest as much in things like R&D, nor are they able to pay for celebrity endorsements like some of their larger counterparts might.
Technological advancements have also led to some larger Chinese brands such as Vivo and Xiaomi offering smartphones at aggressive prices, which take away that low-cost advantage offered by some of the smaller brands.
People also just aren’t buying as many smartphones. In July, Counterpoint noted that smartphone shipments were on the decline year over year for the third consecutive quarter. As a whole, smartphone sales were down 24% over the same quarter last year, with Android devices particularly affected. TCL-Alcatel saw the steepest decline at 69%, while Samsung saw a 37% decline and Motorola dipped 17%. Android phones, of course, are what those smaller manufacturers are making as well. The iPhone has been a bit more resilient, but still saw a 6% drop in sales.
At the time, Counterpoint noted that customers were hesitant to upgrade their devices due to economic uncertainty.
Counterpoint notes that for brands to survive in the market they need to invest in R&D to differentiate their brand from the competition, track their competition, and identify gaps and opportunities where they can target customers who might not be getting what they’re looking for from the big guys.
