QMobile: Conquering the Pakistani market, one phone at a time

Pakistani company’s low-cost smartphones sell like hot cakes.

KARACHI:

With a greater number of Pakistani consumers shifting from basic mobile phones to more sophisticated devices, one local company seems to be making the most of out the increased appetite for cellular multitasking. QMobile – the first Pakistani mobile phone company – has introduced phones packed with high-end features at very competitive prices to the Pakistani market, and it seems to be doing great business.

This Karachi-based company was set up by Mian Pervez Akhtar of Allied Electronics Industries – an importer, assembler and distributor of LG products in Pakistan – around five years ago. According to our sources, QMobile’s revenues have witnessed a phenomenal boost since then: for the year ended June 30, 2012, its revenues stood at Rs761 million – up by a staggering 85.8% over the previous year.

However, the company operates with a different business model as compared to companies like Samsung and Nokia: although it calls itself a mobile phone company, QMobile does not manufacture its own devices; instead, it imports them from vendors in China, and sells them under its own brand. The same phones are sold in India for example under the Micromax label.

QMobile’s growth has taken measured steps. The company started with selling basic mobile phones: “Their low-end devices still account for most of their revenues,” an industry source says. QMobile has a large customer base in rural Pakistan, which accounts for more than 65% of the population. It entered the smartphone segment relatively recently.

Its product range now includes phones with touchscreen features, QWERTY input and WiFi-accessibility. It has also launched a series of smartphones powered by the Android operating system, which is the most commonly used smartphone platform today.

QMobile has built itself a strong image in the market, because it provides fairly high-end features at prices affordable for most Pakistanis: you can now buy a branded Android smartphone for as low as Rs6,500, complete with a warranty, thanks to QMobile. This may well be the primary driver behind QMobile’s growth.

“Basic phones constituted about 90% of Pakistan’s mobile phone market five years ago, but this equation is changing now,” an industry source said. “Consumers are shifting from basic mobile phones to feature phones and smartphones, and today they account for more than 20% of the market. Out of that, smartphones alone account for more than 10% of the market,” he said.

QMobile claims to be the number two brand in the country: and industry sources say that in the absence of any accurately verifiable numbers, this may be so in terms of the volumes of units it sells.

A heavy marketing campaign has also helped the company build a strong brand name. “QMobile is a success story, especially in terms of branding,” a telecom consultant said. Its advertising budget is higher than even that of market leader Nokia, an official revealed.

This is one of the main reasons behind the brand’s success. The company has even used product placement as an advertising technique to promote its products. Take, for example, Bulbulay: a primetime sitcom, which often promotes QMobile products, one source pointed out. “This kind of advertising does not cost much, and earns the company valuable marketing: that too in prime time hours,” he said. Moreover, QMobile has always used Pakistan’s hottest celebrities in advertising its products. Pop singers Atif Aslam and Abrarul Haq have promoted QMobile phones in the past. Iman Ali has modeled for them. Hugely popular television celebrity Fawwad Khan is now promoting their top-tier Noir smartphones. All these factors have helped QMobile make a name for itself as being in a league apart from the cheap Chinese copies of popular handsets currently circulating in the market. It has achieved a measure of respect as a legitimate name in the cellular phone industry.

And to a degree this is true. The phones are visibly better than cheap Chinese knockoffs and perform much better too.

However, despite all its success, the company needs to improve on in its customer service, say industry insiders. Moreover, a lot of consumers complain that QMobile Android phones cut too many corners to provide low-cost devices, and hope that it will come up with affordable technology that can challenge the big guns in the market and give them a run for their money. Right now however the company is apparently following a strategy where it is trying to price out the competition, and it seems to be working.

Published in The Express Tribune, April 7^th, 2013.

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