The Chinese marketing whiz who controls India’s cellphone market

It is tempting to assume Indian consumers are spoilt for choice when it comes to mobile phones, and that the marketplace is brutally competitive

It is tempting to assume Indian consumers are spoilt for choice when it comes to mobile phones, and that the marketplace is brutally competitive. But what most people are unaware of is that a virtually unknown entity called BBK Electronics, a Chinese company, manufactures at least five brands of phones that dominate the Indian market. These are: Oppo, OnePlus, Realme, Vivo and iQOO.

Young woman using cell phone to send text message on social network at night. Closeup of hands with computer laptop in background (Getty Images/iStockphoto)

Between these brands, BBK controls over 40% of the Indian market, the world’s second largest for mobile phones after China. The mastermind who built BBK’s strategy over the years is Duang Yongping, a reticent billionaire, who now lives in the US.

Very little is known about the man and the company in the public domain. And those who do know, prefer to keep their cards close and statements measured. But between controlled literature that emerges once a while in the public domain and one-on-one conversations with people who work with BBK out of India, a picture emerges-- that of an audacious visionary who first tasted success in 1996 as a VCD manufacturer on the back of a risk-fraught bet.

Weather forecasts on China’s state sponsored television (CCTV) are among the most watched segments there. Yongping literally broke the bank and paid CCTV $11.6 million back in the day to book commercial breaks before this segment went live. It left BBK with just about $200,000 for all else which included paying suppliers whom he had sourced materials from. It was inevitable they would pound his doors for payments. He rode the storm out by persuading them to take a stake in BBK by reasoning that the move will pay large dividends because the VCDs brand name will get imprinted in the minds of viewers. It didn’t take long to prove that Yongping’s gamble had been smart play.

He deployed the strategy over and over again and started to spend disproportionate amounts of money on marketing. This meant roping in super star actors such as Jackie Chan and Jet Li to endorse other products that BBK diversified into. It worked each time.

It was only be a matter of time before BBK started to manufacture cell phones under various brand names as demand for VCDs and DVD players started to wane the world over. How to sell them was a game the company had perfected over the years. And there was no way it would overlook India, home to over a billion people with an insatiable appetite for these devices.

But unlike most other entities that focused on trying to wean people by building expensive phones packed with features or stripped-down devices with models at cheap price points, BBK went about it counter-intuitively. It asked what feature may certain kinds of consumers value more in a phone other than its ability to make calls?

This was the right question. Because their research showed that some wanted a good camera; others wanted audio; while there were those who may preferred ease of use. And so on and so forth. Next step? Create devices with these features built in across various price points and build quality with different brand names. Because there may be people who place a premium on branding, and yet others who don’t.

Next, deploy lessons learnt from the early days of capturing China’s VCD market That is where celebrities come in. So, if Ranbir Kapoor represents Oppo India, then Viraat Kohli does the job for Vivo and iQOOO while KL Rahul endorses Realme, and OnePlus has Shahid and Mira Kapur to fan the excitement.

Speaking off-the-record, a social media influencer spoke about how he is supplied with the most recent gadgets and taken to exotic locations, just so he speaks in glowing terms of the products he ‘unboxes’ and ‘reviews’. But all this is kosher because “it’s just business.”

While the hardware battle has been won, BBK is readying to dig its heels in to slug it out in the software space. Most people download apps on their devices either off Apple’s App Store or Google’s Play Store. Each time people pay to purchase an app, Apple or Google keep a percentage. This is where the monies are big and the margins are higher. Apple keeps between 15-30% as commission and Google keeps 15%. Anger against both entities are high in the developer community and a probe has been ordered by the Competition Commission of India (CCI). Amazon has been tinkering with an app store for some time now.

While BBK hasn’t demonstrated its expertise here yet, word on the street is, the company is at work to create an app store to rival Google and Apple. Breaking this duopoly sounds tough – unless BBK comes up with something altogether ingenious. We’ll have to wait and see.