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Smartphones to rule in the post-pandemic era

06 May 2020 12:43 PM

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As a matter of course, the coronavirus pandemic is leaving new lessons for all spectra of life and across all sectors. The cellular phone industry is no exception.

The needs emerging as a result of novel virus are anticipated to change the whole handset business dynamics as persons are now utilizing their devices for various unconventional purposes like holding office meetings, taking academic classes and seeking healthcare, said top assemblers and importers.

Manufacturers will go for new approaches in marketing and distribution while spending lavishly on research and development to include new features and designs that best suit the necessities of the post-coronavirus era.

The handset vendors said the second quarter of the entire year is definitely the worst in the annals of the country's mobile device business, but this will leave a word of warning that may help them grow further in the days to come.

Sales of mobile devices including feature phones and smartphones were almost zero in April due to the government-announced holidays and lockdowns set up since March 26, vendors said.

Subsequently, sales in the first four months of the entire year have been 15-20 % short of the mark but the overall impact will depend on how long the pandemic will linger, said Mesbah Uddin, chief marketing officer at Fair Group that assembles Samsung mobile devices in Bangladesh.

"People are now using a variety of digital services, which give us a glimmer of hope that smartphone sales will jump in the coming days."

Amid the growing demand for online-based services to head off the risks of coronavirus infections, a huge number of users will shift from feature phones to smart devices.

"And should this happen, the cellular phone industry will be one of the primary in the united states," Mesbah added.

The industry sold about 3.11 crore imported and locally assembled handsets last year, of which 25 % were smartphones.

Smartphones will take into account 40 % of the full total sales of cellular devices in the next twelve months, said Rezwanul Haque, ceo of Transsion Bangladesh which makes Techno brand smartphones and itel feature phones.

"Though we are facing some headwinds, the pandemic could prove a game-changer," he said, adding that once normalcy returns, the next one year will be excellent for the handset industry.

People are now conducting office meetings via cellular devices and increasingly using smart devices for entertainment, bill payments and healthcare services.

"In the coming days, features linked to healthcare and recruiting management will be incorporated in the smartphones as persons are getting used to such services at a faster pace," said Haque, also the former general secretary of the Bangladesh CELLULAR PHONE Importers Association.

Transsion was making five lakh bits of phones every month and was likely to expand operations, but their production came to a halt, like the other mobile assembly factories in Bangladesh, for the shutdown.

To handle the emerging situation, industry insiders said vendors will recalibrate their strategies and focus more on online channels for the distribution and marketing of their products.

Recently, online sales comprised significantly less than 2 per cent of the total sales, while the rate is more than 50 % in the Indian market that sells about 26 crore units of handsets a year, Haque added.

"Online outlets should grow a much better sense of responsibility and come up with innovations," said Farhan Rashid, head of business at the Bangladesh chapter of HMD Global Oy, the exclusive licensee of Nokia phones.

Vendors must search for some ways to reduce prices and enhance the service quality in the post-coronavirus days as people are expected to have less to invest on non-essentials.

"We should not merely sell products but also improve services in a way that we will offer a complete solution to customers," he added.

Eid-ul-Fitr and Pahela Baishakh are two of their peak seasons but these are going to generate depressing sales this season, which is why the entire gross annual sales may witness a 30-40 % cut, Rashid said.

Handset assemblers and importers said they registered a 15 per cent decline in sales in the January-March quarter of 2020 from a year earlier.

Companies' digital readiness is actually a major factor in the post-coronavirus era as companies with strong digital occurrence would do better in future, said Ziauddin Chowdhury, country general manager of Xiaomi in Bangladesh.

Industry professionals said flexible payment options like equal monthly instalment and micro-credit facilities, which are yet to flourish in Bangladesh, may open a window of opportunities in future and therefore a regulatory framework ought to be readied as quickly as possible.