“Colors and Gionee are well positioned in the market”

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“Colors and Gionee are well positioned in the market”

Sanjay Agrawal
CEO and Director
TeleTalk Pvt Ltd

With its Colors brands of mobile phones, TeleTalk Nepal is regarded as the first Nepali OEM (original equipment manufacturer) company. Initially the authorised distributor of Spice Mobiles in Nepal, the company made a successful foray into the market by producing affordable Colors handsets. Over the last two years, the company has also been the official distributor of upscale Chinese smartphone brand Gionee in Nepal. Sushil Pangeni of New Business Age caught up with Sanjay Agrawal, CEO and Director of TeleTalk to talk about the recent rebranding of Gionee, market prospects of Colors and Gionee, issues regarding the dealerships and the implementation of the Equipment Identity Registration (EIR) along with the upcoming products of the two brands in the Nepali market. Excerpts:

What is the main idea behind the rebranding of Gionee?
The new Gionee logo was introduced six months ago in India. It is very smiley and fresh looking. Gionee has been selling products for almost eight years now and they thought of adding something fresh to the brand name.

How has the response been to the rebranding?
The response has been very good. We were doing well also before.  The new logo has been lucky for us in terms of our sales growth. The logo looks really fresh and our customers like it.

What is the market share of Gionee in Nepal? 
Gionee’s market share is 7-8 percent currently. We aim to increase the share to 15 percent by the end of this year.

The competition seems to be intensifying with the entry of Chinese smartphone brands in the Nepali market in the recent months. How has it been like for you? 
Gionee is the fourth largest handset brand in Nepal. We have been selling 15,000 units per month. It’s growing. Our sales target is 22,000 units per month by Dashain. We have not able to meet the demand as it is growing every month.

Colors mobile which had enjoyed success in Nepal seems to be lagging behind in the market. Do you think it has become difficult for a successful home-grown handset brand to stay atop in the market?
It is true to some extent. Nevertheless, we are still maintaining our number one position in terms of shipment quantity. Yes, our revenue has gone down. The sales of our phones have been affected by the growth of Chinese smartphones here. But for the last six months, we have positioned Colors in a different way.  We are not competing above USD 150 per unit price at present. Our clear strategy is to pitch below USD 150 where there is no competition with Chinese brands and other global brands. So, we will be selling affordable medium range handsets only. Colors will not be competing in the high end segment for now.

What is the market share of Colors mobile at present?
The current market share is 18-20 percent. We are working to get back to 25 percent which we had previously.

What are your future growth strategies for Colors and Gionee?
For Colors we are focusing on the X-Factor Pride series. This series includes smartphones ranging from Rs 3,000 to 15,000. We have used Sandeep Chhetri, the National Cricket Player, as the brand ambassador of Colors mobiles. 

We have 2.5 million satisfied customers of Colors barphones and that is a huge number. So, they are likely to switch to smartphones ranging from Rs 4,000-10,000. We have been targeting that price segment very well and promoting it through our Pride series. We have been getting tremendous market response shown in the fact that we are always out of stock every month. In the case of Gionee, we have been focusing on handsets above Rs 15,000. And the response from customers for these phones has been remarkable. 

Who do you consider to be the major competitor brands?  How is the competition?
The major competitors for Gionee are Huawei and Samsung. The increase in competition is good for customers as well as the brands. But, I see some unhealthy competition between Chinese brands and Samsung at present. I think it will create instability in terms of smartphone prices.  Let’s see how far they will go.

Are there any new Gionee and Colors phones in the pipeline? What will some of the key features be in the upcoming handsets?
We have segmented both brands very well. The business of Colors is not hampering Gionee and vice versa. For Gionee we have been promoting the M (Marathon) series which is famed for high battery life. Another one is the S (Stylistic) series. Currently, we have three models in the S series. We are going to launch two new models namely, Gionee S6s and S6 Pro before Dashain. Altogether there will be five new Gionee models out by Dashain. As for Colors we are coming out with ‘selfie’ phones namely, the P85 and P85 Plus under the Pride series. The new handsets will come with excellent camera quality, big screen, higher memory and battery capacities at very affordable price points.

 What challenges are handsets distributors in Nepal facing at present? 
I do not see many problems in the handset market at present. Smartphone penetration is growing rapidly all across the nation. Finding a smartphone distributor is not a big deal now, not as difficult as it was 2-3 years back when it needed big investment and infrastructure.For customers, smartphones have become an integral part of their lives. 

How hopeful are you about the successful implementation of the Equipment Identity Registration (EIR) System? What are the challenges?
It is a long way to go. The implementation part is difficult and the government is not ready yet. The authorities have just decided to go for it but haven’t done enough homework. As per my information, it will take a minimum of two years for it to be implemented. Effective implementation of EIR will benefit domestic brands like Colors. 

 

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