Retail News CRM

Author: Mei Ling Tan

  • Samsung Recovers More Than 60 Percent Of Galaxy Note 7 Smartphones In US And South Korea

    Samsung Recovers More Than 60 Percent Of Galaxy Note 7 Smartphones In US And South Korea

    Galaxy Note 7 smartphones caused headaches and occasional burns to their owners, but only 60 percent of the defective devices sold in South Korea and the U.S. have so far been exchanged with new models, Samsung says.

    This means that 40 percent of the potentially explosive handsets are still in consumer hands, despite the fact that Samsung issued a worldwide recall on the smartphone almost a month ago.

    The percentage shows that the successful exchanges in the U.S. are slowing down.

    At the middle of last week, Samsung reported that 50 percent of the potentially hazardous smartphones were replaced with new models in the U.S. It would seem that the number of returns increased by 10 percent in five days, but keep in mind that the total figure takes into account South Korean returns as well.

    Last week, reports from South Korea indicated that the return percentage in the country is north of 50 percent.

    Samsung tried its best to motivate South Korean retail stores to accelerate the replacement of faulty Note 7 phones, and it even put financial incentives on the table. The Korea Times reports that vendors can earn 20,000 won (about $18) per exchanged phone. Stores can get an additional $18 per phone should they top an 80 percent exchange rate of the Note 7 handsets prior to the end of September.

    Even with the financial motivators in line, mobile customers in South Korea seem rather reluctant to let go of their Galaxy Note 7s. In the OEM’s home country, it took five days to see half of the Note 7 stock exchanged, whereas in the U.S. and Singapore the switch only took two days for 50 percent of devices.

    Singapore customers wasted no time and swiftly returned the fiery Note 7 models. Samsung’s recall program was open for 10 days in the country and it already ranked an 80 percent exchange of the Note 7.

    The recent battery scandal dented Samsung’s reputation as a reliable electronics manufacturer as well as its share value. However, 90 percent of Note 7 customers choose to replace their phones with a safe version of the same device. Of South Korean clients, only 4 percent chose a refund over an updated Note 7.

    As a reminder, the biggest smartphone builder announced on Sept. 2 that at least 2.5 million Note 7 smartphones are being recalled due to faulty batteries that can overheat while charging, causing some phones to burst into flames.

    According to the OEM, the replacement devices that are in stores are sporting safe batteries.

     

  • Why Is China The Center-Piece Of Starbucks’ Growth Story?

    Why Is China The Center-Piece Of Starbucks’ Growth Story?

    China is the brightest star of the Starbucks growth story. The company has almost 2,300 stores in over 100 cities in China, and continues to open more than one store per day. China outshone the other regions in the June quarter, by posting 7% comparable sales growth due to increased traffic. Further, China accounts for over 10 million of the 19 million Starbucks Reward members in China and Asia Pacific (CAP). To reinforce China’s growth potential, Starbucks has plans to open up 2,500 stores for the next five years in the region.

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    Why Is The Focus On China?

    Starbucks is facing intense competition from western brands like McDonald’s, Dunkin’ Donuts, and Burger King, to establish a foothold in China, not to mention the existing domestic players. However, Starbucks differs from the other food chains in the fact that it is seeing continued success in the region, while others, like McDonald’s, which is selling-off its restaurants in mainland China, are seeing their business flailing. The question to be asked here is why is everyone focusing on China. There are a number of reasons. Firstly, the American market is largely mature. Consequently, a large growth impetus cannot be expected from the U.S. That means Starbucks, like others, needs to look at emerging countries and markets with low penetration to drive revenues. This leads us to China, which is the second largest economy in the world. The middle income class in China is expected to double over a period as short as five years. Although, its economy has slowed down recently, China is still among the fastest growing nations, far ahead of Europe and the States.

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    What Is The Reason Behind Starbucks’ Success In China?

    According to data from Roland Berger, Starbucks dominated the Chinese coffee market with an impressive 60% share, while McDonald’s and Costa only make for 13% and 11% of the total. One of the major reasons behind Starbucks’ success in China, when others are failing, is its commitment towards delivering what customers want. Instead of trying to pitch the U.S. bestsellers in China, it came up with new and innovative products, such as green-tea flavored coffee, which holds appeal for the country’s masses. Secondly, rather than pushing take-out orders, which account for the majority of American sales, Starbucks adapted to local consumer wants and promoted dine-in service. Although dine-in services bring in lesser revenue per square meter, Starbucks’ high pricing strategy in the area results in China being as profitable a market as the U.S.

    In addition to all this, Starbucks proved itself to be an employee-friendly workplace. While most western conglomerates treat their Chinese employees like cheap labor, causing the turnover rate to be high, Starbucks has invested in its employees through programs like student loans and subsidized accommodation. This further strengthened Starbucks position in China as satisfied employees are the best marketing agents a company can possibly ask for as they are the ones responsible for customer experience. Moreover, it has smartly partnered with local companies in various parts of China to overcome hurdles, deal with the complex foreign laws, and thus, grow effectively. The recent partnerships with the Chinese company, Tingyi, to manufacture and sell “ready to drink” products in China, is one example.

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    What Is Next For Starbucks In China?

    According to the management, Starbucks plans to make China its largest retail market by the end of 2019. As mentioned before, it plans to open 2,500 new stores over the next five years in the region, even as the concerns about the slowdown in China increase. In 2017, it plans to open up a 30,000 square-foot Starbucks Shanghai Roastery and Tasting Room to appeal to the growing and increasingly rich upper class of China.

    Starbucks has also begun sourcing its coffee beans from areas within China, to seem less foreign and help the domestic coffee industry flourish. Further, Starbucks has branched out into selling tea drinks, such as Teavana, in China. According to Euromonitor, the size of China’s retail tea market was nearly $10 billion in 2014, the largest in the world and far ahead of second-positioned Russia.

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  • Are low spending Chinese shoppers a new normal?

    Are low spending Chinese shoppers a new normal?

     

    August shopping data from tax refund specialist, Global Blue, indicates a downward trend in tax-free in-store sales of -13% (year-on-year) – the worst decline since the start of the year and a big fall compared with July’s 0% change.

    global-blue-august-asia-3-markets
    There are stark differences in August tax-free sales, largely because of the beneficial ‘MERS effect’ in Korea.

    While transactions rose significantly in August by +25%, the decline of average spend at -30% clearly shows that individual travellers are spending less and this is probably due to a combination of factors ranging from China’s customs clampdown, a different passenger profile, and currency influences.

    Global Blue says: “The rise of less affluent middle class Chinese travellers continues to bring down the average spend of tax-free shopping globally, with a sizeable impact in Asia. Across the region more ‘value seekers’ from second-tier and third-tier cities are growing their transactions, but with less affluent spending patterns.”

    Duty free and travel retailers can take comfort from the rising number of travellers in Asia, which correlates with higher numbers of transactions in South Korea, Japan and Singapore. But, says Global Blue, the overall sales performance in the region is significantly limited by the headwinds of a stronger yen in Japan and Chinese spending in the region increasingly being driven by value-seeking shoppers who spend less.

    COMMON THEME IS LOWER SPEND POTENTIAL

    The travel boost is not compensating for the spending fall in key duty free and travel retail locations such as Singapore and Japan – while Hong Kong (downtown) does not even have the benefit of rising traveller numbers.

    All Global Blue’s Asia tax-free shopping destinations rely on increased arrivals and traffic, yet the common theme is lower spend potential. With -33% sales in August, Japan has been affected by the strong currency, which has negatively impacted the number of transactions.

    Global Blue August Asia

    Transactions are strongly up but average spending is even more strongly down.

    Global Blue estimates that 23% of Japan’s negative sales performance this month is driven by the softer yen and the other 10% is due to increased numbers of less affluent Chinese shoppers arriving in Japan (+20 to +30% more in the first half of the year at Narita airport) from second-tier and third-tier cities.

    South Korea’s sales performance of +44% this month (versus an impressive triple-digit growth of +215% for July) is on the back of highly beneficial comparisons to last year when the MERS virus took a big toll on traffic.

    ASIA YEAR-TO-DATE DOWN -21%

    Transaction numbers are significantly up across all globe shopper nationalities in Asia, except for Hong Kong (-10%), reflecting the increase in air arrivals across Japan and South Korea. Taiwanese globe shoppers (+43%) showed the highest transactions growth in the region in August, followed by Chinese (+28%), with Thais and Indonesians up too. However, the decline in average spend per transaction is a long-term trend.

    Global Blue estimates that the new Chinese value seekers are having a negative impact of between -6% and -10% across Asia as their demand for regional travel increases, driven by the Chinese government’s strategy of strengthening the economy by localising discretionary spending.

    Year to date tax-free sales performance across the region is flat and average sales are down -21%. A less favourable economic situation in mainland China is also not helping travel spending: for example Japan’s current picture YTD is a +26% increase in transactions and a decline of -25% in average sales.

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  • Việt Nam retail market attracts international investors

    Việt Nam retail market attracts international investors

    Việt Nam’s growing retail market has attracted the attention of foreign retailers. A series of famous retailers from Japan, Thailand, South Korea and France have flocked to the country, hoping to penetrate the market, a recent JLL Việt Nam report said.

    As penetration of foreign retailers into the country has increased, fierce competition in the retail space has become more intense. This will put the retail market to the test and only retailers with the right positioning to meet market demand will gain market share.

    In 2014, the Berli Jucker acquisition of Metro Cash & Carry Việt Nam for an enterprise value of 655 million euro (US$700 million) – the largest-ever Merger & Acquisition deal in Việt Nam at that point – signalled entry of the Thailand retailer into the country.

    Later, another Thailand giant, Central Group, acquired Nguyễn Kim Trading – Việt Nam’s top electronics retailer, and BigC Việt Nam- the second largest supermarket chain in terms of store number in the nation.

    In October 2015, Emart – the leading South Korean retailer – officially marked its entrance with a US$60 million shopping centre in north HCM City. Also from South Korea, Lotte Mart is quite successful with 11 supermarkets, a number expected to increase to 60 stores by 2020.

    Most Japanese investors consider the success of Aeon in Việt Nam a praiseworthy case in overseas investment. Aeon has four malls and expects to reach 20 malls before 2020. Also from Japan, Takashimaya arrived in July 2016 as anchor tenant of downtown HCM City’s Saigon Centre retail mall.

    Adding to three Simply Mart stores in HCM City, AuchanSuper, a major retail brand from France, is planning to open another 17 supermarkets by end-2017 in the city and 20 stores by 2020 in northern Việt Nam.

    Thanks to increasing disposable incomes, big fashion brands such as Gap, Mango and Topshop have become the top choice of many young Vietnamese. In September 2015, Zara opened its first flagship store in HCM City. H&M will reportedly enter Việt Nam early next year.

    With 90 million people, Việt Nam has attracted retailers with its relatively young population – 70 per cent are aged between 15 and 64 years – who promise to be a key driver of robust market growth. Việt Nam’s urban population is expected to grow 2.6 per cent annually from 2015 to 2020, the highest rate among regional peers.

    “Increasing disposable incomes, rapid urbanisation and rising living standards make Việt Nam one of the most dynamic emerging economies in South East Asia,” says Bùi Trang, Commercial Leasing Director at JLL Việt Nam.

    According to the Boston Consulting Group, Việt Nam has the fastest growing middle and affluent class (MAC) in the region, which will double in size between 2012 and 2020, from 12 million to 33 million. MAC consumers, whose income is VNĐ15 million (US$700) or more a month, will be a key group of potential customers for retailers.

    Việt Nam e-commerce is set for strong growth thanks to its growing consumer and online population. According to the Nielsen’s report, nine out of ten consumers in Việt Nam (91 per cent) own smartphones, compared to 82 per cent in 2014, and the rapid up-take of connected devices, especially smartphones and tablets are instrumental in media consumption shifting.

    “Significantly increasing the amount of the credit card holders has also had an impact on the change in consuming behaviour. It is observed that people now are more willing to spend as they can afford more with credit and it tends to make shoppers less canny,” she said.

    Additionally, increasing international arrivals and continuously improving infrastructure are also factors that make Việt Nam an alluring market for retailers.

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  • High-end Knockoff Retailers Busted in Seoul’s Busiest Tourist District

    High-end Knockoff Retailers Busted in Seoul’s Busiest Tourist District

    Seoul police busted four retailers Monday for selling counterfeit products of luxury brands in Myeongdong, one of the busiest tourist and shopping districts in Seoul. 
    fake-product-luxury

    The gang launched operations in April, and has since sold 40-million-won ($36,245) worth of knockoff products from 41 brands that included luxury brands Louis Vuitton and Rolex. Converting the sales figure to the retail value of their respective genuine products, they were worth over 8.3 billion won, the police said. 

    The suspects displayed the products without the logo engravings to evade police crackdowns. Instead, they sold the final products with the logos at a separate storage area only when visiting customers asked for counterfeit products.

    “Counterfeit products can badly hurt the image of Myeongdong, so we plan to continue our crackdown operations jointly with the local government and the intellectual property office,” said a police official.

     

     

    Image Credit: Yonhap 

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  • Nepal set to approve 4G launches

    Nepal set to approve 4G launches

    Nepal’s telecoms regulator will soon approve two of the three applications it has received from operators seeking to operate 4G services.

    The Nepal Telecommunications Authority’s (NTA) Frequency Management Department has recommended that the regulator allow both Nepal Telecom and Ncell to launch 4G services.

    But the department rejected the proposal of a third operator, Smart Telecom, after finding that the operator failed to meet certain prerequisites. Eligibility was determined based on factors an operator’s current services and its performance under the Unified License issued to it.

    As soon as the NTA board passes the recommendation, Nepal Telecom and Ncell will be able to launch 4G services.

    The operators have been requesting to launch 4G for months, by repurposing the 1800-MHz spectrum currently being used to provide 3G services.

    But the NTA was not able to approve the proposals until the government passed amendments to the existing radio frequency policy. The ICT ministry has now endorsed the amendments to the policy.

    According to the report, Nepal Telecom has asserted it will be able to launch 4G services within two months of receiving a license.

  • AIS ramps up fiber competition

    AIS ramps up fiber competition

    Thailand’s top mobile operator AIS is gearing up to launch what it says will be the country’s fastest fiber broadband services.

    The operator aims to attract 300,000 users to its fiber service this year, increasing to 2 million by 2019.

    The operator first entered the fiber broadband fray in April and has already been shaking up the market. The company currently has around 200,000 subscribers to its existing fiber services, a roughly 2% share of the total market.

    Now the company aims to disrupt the market further, with plans to offer an entry-level 20Mbps service for 590 baht ($17) per month, comparable to the prices of ADSL broadband services.

    AIS will also offer 50Mbps services for 888 baht per month and 100Mbps services for 1,888 baht per month. All packages will include free WiFi routers, free AIS internet TV and free installation.

    With the new packages AIS has increased its target monthly fiber net additions to 45,000, up from a previous target of 30,000-35,000.

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  • Ericsson, HomeSend team for remittance in emerging markets

    Ericsson, HomeSend team for remittance in emerging markets

    HomeSend and Ericsson have teamed up to accelerate the adoption of international remittances via mobile across emerging markets.

    With the partnership, 50 million Ericsson-powered mobile wallet users are expected to benefit from access to international payment services via HomeSend’s network of money transfer operators (MTOs).

    The Ericsson Wallet Platform is now certified by HomeSend, a joint venture between Mastercard, eServGlobal and BICS that aims to bridge the gap between financial institutions, non-financial entities and mobile network operators.

    The HomeSend-Ericsson partnership aims to give financial service providers a low-cost, simple and fast way to connect the HomeSend global money transfer hub with Ericsson’s mobile money offering around the world. With this, mobile money users are expected to be able to enjoy new levels of flexibility, choice and value.

    Ericsson’s Mobile Financial Services solutions now also include Ericsson interconnect, the company’s cloud-based financial transactions switching and mediation service, which aims to extend reach to Financial Services providers using any wallet or mobile banking platform.

    “The partnership represents HomeSend’s continuing commitment to displace cash and facilitate electronic payments, advancing financial inclusion in the new global economy,” said Stephen Doyle, CEO, HomeSend. “Millions of new unbanked consumers will gain improved access to digital inflows from friends and relatives, as we continue to advance toward a fully open ecosystem for global mobile money remittances.”

    In 2016, the World Bank expects remittances to reach over $600 billion, with more than $440 billion being sent to developing countries. The partnership aims to bridge the gap between finance and telecommunication service providers, enabling mobile wallet users to send and receive money from their family abroad through their mobile phones, while enabling financial institutions to offer their customers the convenience of digital money transfers regardless of their location or that of the recipient.

    “By enabling fast, secure integrations to HomeSend’s remittance hub, we are providing growth opportunities for our customers,” said Peter Heuman, head of Ericsson Mobile Financial Services.

    “Integration with the HomeSend Hub connects Ericsson mobile wallet powered financial service providers, and potentially other financial service providers, to a global network of financial institutions and MTOs. This represents a major advance in helping to grow mobile financial services ecosystems whilst supporting financial inclusion.”

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  • Teradata boosts customer experience with behavioral insights

    Teradata boosts customer experience with behavioral insights

    Teradata now offers the Teradata Customer Journey Analytic Solution, a complete set of capabilities for discerning the behavioral paths of each individual customer.

    The solution determines the next best interaction and delivering a consistent, personalized brand experience through every channel and touch point. It also uses Teradata’s consulting services, as well as technologies that enable real-time customer data integration, advanced behavioral analytics and multi-channel marketing automation.

    Further, the solution enables CMOs who want to truly understand each individual customer experience to move beyond old school one-to-one marketing tactics that rely on purchases and traditional customer profiling.

    The insights resulting from Teradata’s Customer Journey Analytic Solution enable marketers to optimize objectives such as response and conversion rates, service delivery, churn, and customer satisfaction – leading directly to high-impact business outcomes such as increased revenue and customer retention.

    Customers today require every interaction with a brand to be consistent, but also personalized and relevant. This is despite the ever-expanding range of channels that make building a complete picture of each individual customer extremely challenging.

    “Managing every customer as an individual, based on their interactions with your company, requires not only the integration of different types of data but understanding it through the application of complex multi-genre analytics,” said Dan Harrington, EVP for consulting and support services of Teradata. “Even the best-known companies feel this is a ‘boil the ocean’ project – making sense of billions of events for millions of customers, in real time.”

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  • Twitter said to be looking to sell

    Twitter said to be looking to sell

    Twitter, the global microblogging service that pioneered hashtags and the art of marketing in small, crisp sentences is reportedly looking for suitors.

    The sale around the region of $16 billion, although no accurate sales figures have been released and it greatly depends on the performance of Twitter’s stocks.

    Reportedly, Twitter is working with Goldman Sachs and Allen & Co for the potential sale.

    According to Reuters news sources, the company is not short of suitors. The list includes Alphabet (Google parent), Microsoft, Salesforce.com and Walt Disney, Twitter CEO Jack Dorsey is a board member.

    Facebook, for the moment, seem to be glaringly absent.

    No assurance of an actual sale has been given as of time of reporting.

    A similar rumor reared its head around the same time last year, although evidence points to more concrete reports this time.

    The biggest problem for Twitter is in its ability to be clear about its mission: whether it is a technology company or a media player.

    It also has not found a way to monetize its over 300 million subscriber base. In comparison, Facebook and LinkedIn have fared better.

    Twitter’s foray into becoming a major media player has not fared any better. Its prominence in the Rio Olympics did not increase engagement and a streaming deal with NFL is way lower than live TV. These misses have analysts saying that the Twitter stock being overvalued.

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  • Double Dragon plans 100 CityMalls

    Double Dragon plans 100 CityMalls

    Listed Philippine property developer Double Dragon plans to build a network of 100 neighbourhood style shopping malls across the Philippines by 2020.

    The  company has already opened eight CityMall centres and secured 53 sites to date. The new centres will range anywhere between 5000 sqm and 10,000 sqm.

    Last week DoubleDragon announced it was issuing P15 billion in retail bonds to fund the development of its projects next year.

    “The majority of the proceeds will be deployed in our projects within 2017 as by 2018, we expect to already have substantial rental revenues from our provincial community mall chain, CityMalls and our Metro Manila office projects such as Double Dragon Plaza in DD Meridian Park and Jollibee Tower in Ortigas CBD, both of which are expected to be completed within 2018,” Sia said.

    Listed back in April 2014, Double Dragon Properties, has increased its stock value 29-fold since then – it’s risen 140 per cent this year alone.

    CEO Edgar “Injap” Sia, 39, from Visayas, co-founded Double Dragon with Jollibee founder Tan Caktiong, who bought a controlling interest in Sia’s fast food chain Mang Inasal in 2010, acquiring the 30 per cent balance last April. Each deal was valued at 5 billion pesos.

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    In 2012, the two businessmen acquired an Iloilo-based property developer, turning it into Double Dragon and setting a course for a nationwide property group. Before the float, Sia accepted an offer from SM Investments to acquire a 34 per cent stake in City Mall Commercial Centers, which runs CityMalls on Double Dragon’s behalf. That gives fast food entity Jollibee a ready entry into regional markets – and SM Investments an interest in retail property outside the main cities in which it dominates with its larger-sized malls. As part of the broader SM group, CityMalls has a large, ready-made pool of potential tenants every time it opens a new facility- across food, hardware, health & beauty, grocery retailing and fashion, among other categories.

    About 70 of the 100 malls planned initially will be built in the Visayas and Mindanao. The next scheduled to open – in October – will be at Cotabato in Mindanao, west of Davao and a location where neither Robinsons or SM have yet opened shopping centres.

    One of those is at the 116ha Northtown residential complex being developed by Alsons Development and Investment in the northeastern part of Davao.

    Sia said the mall, expected to be completed by the end of 2017, will anchor the residential development, serving residents and locals.

    “We can clearly see the vision behind Northtown to soon become one of the most vibrant areas in Davao City,” he said.

    CityMalls are positioned in the market as one-stop shops for daily purchases – not destinations to spend a day shopping, watching movies and eating with family or friends. Sia does not aim to compete with larger regional malls, the likes of which SM is rolling out across urban areas nationwide.

    Sia is also considering opportunities outside the Philippines long-term, as well as more locations at home.

    “Once we complete [100 malls], our presence will be powerful, and the confidence in our company will be higher,” he said in a recent interview.

    *Image: Louisechelle

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  • Korean partner for Perry Ellis

    Korean partner for Perry Ellis

    Perry Ellis has signed a licence agreement with Doctorstick Korea Co to design, manufacture, market and distribute men’s and women’s contemporary sport and casual shoes under the Perry Ellis brand.

    Currently the US brand has 37 product categories, spans more than 50 countries and generates almost $1 billion in global retail sales annually.

    “We are confident this joint effort will provide us with a platform consistent with our strategic initiative to expand the Perry Ellis brand globally,” says Perry Ellis International executive chairman George Feldenkreis.

    Doctorstick Korea plans to launch the footwear program through eCommerce platforms and television shopping channels in Korea in spring next year, and target an introductory full collection by the middle of the year.

    Established in 2007, the company also licenses the Flying London and Mono Cross brands in Korea.

  • Shiseido Playlist launches online only

    Shiseido Playlist launches online only

    The new Shiseido Playlist make-up and skincare brand has been launched for exclusive online sale, with the exception of the cosmetic brand’s Tokyo Ginza store.

    Playlist is available via Watashi+, the group’s own website and other e-stores.

    Distinctive for its minimalist design, Playlist targets women between 25 and 39 years, the demographic that favours online shopping. Developed by Shiseido’s professional makeup and hair care teams, the range focusses on compact lipsticks, foundations and eye makeup. The brand debuts with 31 looks, with others expected to be launched in November.playlist-2

    Playlist also features an online personal advice service, and the brand ambassador will be Belgian-Japanese model Yumi Lambert.

    Playlist has initially been launched in Japan, coinciding with Shiseido replacing Maybelline as make-up partner to Amazon Tokyo Fashion Week.

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  • Apple Korea to launch first official store

    Apple Korea to launch first official store

    Apple Korea is to open the brand’s first official store in Seoul, but no date has been revealed.

    A lease has been signed for a property in Garosu-gil Road, an upmarket, tree-lined street, with Apple Korea paying a 1.6 billion won (US$1.44 million) deposit for the lease, which runs to February 29, 2036.

    Without an Apple Store in Korea, consumers have had to turn to third-party suppliers, leading to complaints about delays and poor service, reports the Korea Times.

    In response, the Korea Fair Trade Commission told Apple in December to rectify its policy.
    Apple has started recruiting staff for the Seoul store, advertising positions covering marketing, store crew and customer service.

  • LeEco India ready to roll out 1000 stores

    LeEco India ready to roll out 1000 stores

    Chinese tech firm LeEco India plans to open 1000 outlets across the subcontinent by the end of this year.

    Expecting half of its revenue in India to come from physical stores, LeEco filed an application five months ago with the Foreign Investment Promotion Board (FIPB) to open single-brand retail stores.

    These will be a mix of company-owned stores as well as franchise outlets, says LeEco India COO for smart electronics business Atul Jain. “This is in line with our aim to be among top three brands in the country by 2018.”

    LeEco, which also has an offline presence in China, has not revealed the cost of setting up the stores. However, it will be spending nearly US$10 million on marketing in the three months starting October.

    Already the company has tied up with multiple distributors across organised and unorganised channels in India and is already available in about 3000 outlets in cities including Bengaluru, Chennai, Delhi, Mumbai, Pune and Varanasi. It expects to reach 65 cities and have a presence in 6000 to 8000 outlets by December.

    No longer exclusive

    Launched exclusively on Flipkart, LeEco’s products will now be available on other eCommerce marketplaces such as Amazon India and Snapdeal. Flipkart has contributed nearly 75 per cent of LeEco’s sales in India.

    LeEco has invested Rs.50 crore (US$500 million) in setting up a smartphone assembly plant in the Greater Noida area, in partnership with Compal Electronics. The factory has an initial capacity of 60,000 units a month but this will be ramped up to 200,000 by the end of December.

    By the second half of next year, the company plans to start exporting products to Hong Kong, Indonesia, Malaysia, Russia and Singapore, says Jain. LeEco sold more than 70,000 phones and 2000 televisions last month alone.

    Other plans include a partnership with Hungama to offer music services from next month.
    Founded by billionaire Jia Yueting in 2004, LeEco positions itself as the Apple, Netflix and Tesla of China. Apart from smartphones and online content, the company sells TVs, electric vehicles and virtual-reality headsets.

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