HTC’s recent shift in focus from making operators’ white-labelled devices to channelling more resources into promoting its own brand is starting to pay off. The manufacturer’s global sales and market share has doubled during the past year.
The rapid growth makes HTC the world’s third largest smartphone manufacturer, and one that the market is beginning to consider as a very serious contender. But it still has a long way to go in catching up with market leaders Nokia, which has 47.5% of the market, and BlackBerry, which has 17.4%, according to figures from analyst firm Gartner.
Following the same path that has provided success for RIM and its Pearl range, HTC is diversifying from business-heavy Windows devices towards more consumer-friendly phones.
HTC’s executive director, Paul Ghent (pictured), says: ‘We are really getting into the consumer market. Historically, we have concentrated on the business arena with Windows Mobile devices, but since we started focusing on building our own brand, we have come out with phones that appeal to prosumers and ultimately to consumers.’
The first handsets with less of a pure business focus were those in the Touch range, including the Touch Diamond. More devices will follow to compliment these ranges with appeal to less business-focused consumers.
Ghent believes that handsets like HTC’s iPhone killer, the Touch Diamond, with multimedia functions that compliment the phone’s business tools, will get momentum behind the brand, as they appeal to a wider cross section of the population, with multimedia functions that compliment the phone’s business tools.
‘Devices like the Touch Diamond addresses consumer needs like music and imaging. While our devices are in the prosumer segment, we intend them to also appeal to people that don’t have a business need. If we want to truly expand, we need to introduce our handsets to a wider range of the market,’ he adds.
However, this doesn’t mean that the company will completely move away from business-heavy phones. For example, the latest release, the Touch Pro, is aimed at corporate users.
Building the brand
Until around two years ago when HTC launched its first own-brand handsets, the company was solely making devices for operators to brand as their own. It was only really this year that the manufacturer started promoting its own name and coming out with high-profile handset ranges under the HTC brand.
Being able to market devices under its own name gives HTC more direct control over its image and the way the handsets are marketed.
To increase brand awareness, HTC is pouring significant resources into advertising. One of its most prominent ad campaigns was at the London Imax cinema in Waterloo, which was wrapped in images of the Touch Diamond for two weeks. And there are some more high-profile advertising campaigns to follow.
Ghent says: ‘Generally, we will target outdoor campaigns which will focus on hero devices like the Diamond that appeal to a wide range of people. We’ll launch campaigns in areas with high footfall, such as airports and the London Underground.
‘We can’t flood the market [with ads] as we’d like to because it’s very expensive, but where we can, we’ll do more big campaigns.’
HTC is working closely with all the retailers and networks to ensure consumers become aware of not only the brand, but also the fact that the manufacturer’s handsets are no longer purely business devices.
‘They [retailers] are beginning to realise that the area of smartphones is broadening. There are consumers that haven’t used phones with smart technology, who will now find elements of these platforms appealing. Retailers are realising they can’t pigeonhole these devices anymore,’ says Ghent.
Retail presence is another area that HTC is pushing to increase the prominence of the brand. Focusing on its own brand has required it to build different types of relationships with existing and new partners.
‘We are focusing on retaining partnerships with older partners and introducing new devices to their portfolios. We are also building newer relationships with the other operators and with MVNOs. Carphone and Phones 4u are also very important to us for reach,’ says Ghent.
HTC is also working with the largest retail partners on joint marketing campaigns to gain presence in things like buyers’ guides, he adds.
Although the main focus for HTC is now on building the consumer awareness of its own brand, the company is not leaving the white labelling business. It will keep providing O2’s Xda range of devices and T-Mobile’s MDA range.
Ghent says: ‘The fact that we have launched our own brand doesn’t mean that we will completely walk away from the ODM business. We continue to support our operator partners whom we have been working with for years.’
A part of ensuring HTC’s retail presence also involves getting products to an increasing number of independent dealers. To achieve this, the manufacturer signed up Brightpoint this summer as its main distributor in the UK. HTC had been working with Brightpoint abroad, as well as with Hugh Symons Telecom, which has since been acquired by Brightpoint.
‘We already have a relationship with Brightpoint internationally, and we’ve had a long relationship with Hugh Symons, so it made sense to continue with them under the Brightpoint brand,’ Ghent says.
However, some in the distribution industry have criticised HTC’s decision to go with only one distributor. One source in distribution says: ‘The market is a bit of a monopoly, Brightpoint are controlling the prices on HTC. And HTC is what the market seems to want. There have been quite a few products that have had a real impact on the market, such as the Diamond and Cruise.’
But Ghent defends the company’s position to work with only one distributor. He says: ‘We have full visibility of how they are distributing our brand and we support them where necessary. It achieves consistency for us and allows us to co-operate with them on things like retail presence. As long as we are achieving our expectations, we are happy with them.’
There are still more devices that the manufacturer has in the pipeline and it’s unlikely we have seen the complete Christmas line-up yet. Ghent is unwilling to reveal details of HTC’s product roadmap, but says the company will keep moving away from purely business handsets.
‘There will be more consumer-focused devices. If you look back at what we have launched, new devices will be in line with those,’ says Ghent.
The Google Dream
Rumours about HTC developing the first Google Android handset have been flying around for so long that it seems like the industry’s worst kept secret. The handset has been branded ‘Dream’ and some very detailed but speculative reports about its specs have been released. The phone is said to have a sliding touch-screen and QWERTY keyboard.
News agency Reuters reported last week that T-Mobile in the US was due to launch the phone in October.
Ghent refused to comment on the rumours about the Android handset.