Transsion Holding has been selling its products in the African market, among other developing regions in Asia and South America for some time now.
The company is well known because the majority of its products are held by millions of people in the said markets. The products are mostly smartphones, which include brands such as TECNO, Infinix, and iTel.
Transsion has also been trying to make a name for itself in the home entertainment segment, and has since released a couple of Infinix-branded and Syinix televisions.
That is not all; smartphone brands have, in recent times, been attempting to appeal to their customers with an all-wireless approach, hence the constant release of wearables such as smartwatches, wireless earbuds, fitness bands, name them, all of which Transsion has taken part in.
All the names products have seen the company do very well in terms of customer reach and profits, which is an interesting development because the better part of 2020 was marred by the COVID-19 pandemic that continues to see some companies, service-oriented or otherwise, lose a substantial chunk of their revenues.
A report published by CounterPoint highlights the overall returns made by the company in the first three quarters of 2020. The numbers are impressive, bearing in mind that the smartphone manufacturer went public sometime in 2019.
According to the research organization, Transsion’s current market capitalization is $16.9 billion.
It reported revenue of $3.77 billion, and an income of $295 million in the first three quarters of 2020. At a glance, the numbers cannot be compared to what the likes of Huawei or Samsung make, and deservedly so because those are bigger companies that have been in the smartphone business in a long time.
However, the part where they show that the company performed well amid the pandemic is that they are 48% and 50% higher than their respective performances in the same quarters of 2019.
It would also seem that Transsion’s approach to tackling its main markets is working. It, for example, prices its devices competitively, and that is obvious because some of its devices are some of the cheapest kind you can find in any shop in Africa.
Transsion is also keen on localization (it concentrates in very particular markets), besides it making sure that people are aware of its products and services.
The said approaches have, in our opinion, worked to their company’s advantage. There is no denying that a lot of people are invested in a TECNO or Infinix ecosystem, and over an extended period, they have come to trust what their purchases offer (there are a ton of things that the company could improve on, but that is a story for another day), a development that ultimately grows to loyalty.
It should also be remembered that the African market is a tricky one, mostly because purchasing power is low. To this end, some brands, mainly established ones, tend to ignore it. Some are here, including Huawei and Samsung, but the latter hasn’t been doing a very good job in re-popularizing its devices, and has since chosen to focus on flagships devices – which, ironically, are out of reach of the lion’s share of potential African buyers, but still make sense because they report higher profit margins.
Perhaps, the lax approach, or the recent tendency to purposely or inadvertently ignore the market is what has catapulted Transsion to this glory. As said, Samsung appears to have picked the mid-range and high-end segment. Huawei has its own problems, and Nokia is trying desperately to appeal to customers who have moved on to other brands, even to the point of reviving older brands in the name of nostalgia. The collective effect of former big boys ignoring the budget buyer is what has seen Transsion prosper.
As a heads-up, the three Transsion brands constitute 38% of all smartphones shipped in Africa in the third quarter of 2020. The company also commanded 67% of feature phones shipped into the continent in the same quarter. The smartphone numbers, of course, are higher than what Samsung (16%) and Huawei (7%) commanded in the same quarter.
In summary, Q3 2020 performed as follows in terms of smartphone shipments to Africa: