Taiwan-based Asus expanded its footprint in the country with the launch of its smartphone, ZenFone. Primarily a PC-maker, Asus’ handsets will compete across both the sub-₹10,000 and higher categories. Pricing apart, upgrading of feature phones users to the ZenFone form the pivot of its success in India. In an interview of Business Line , Peter Chang, Regional Director-South Asia and Country Manager-India, talks about its smartphone strategy, differentiation in a cluttered handset market, R&D plans and leveraging its distribution network. Edited excerpts:

What made you go for smartphones, when notebook was the primary growth driver?

Some two years back we decided to develop smartphones as there was demand for it. There is a convergence happening (with people going for) so many devices. And if we don’t cover all the segments, it will be dangerous.

There’s a movement towards three-in-ones – PCs, tablets and smartphones. And, these are the bring-to-Internet or client devices. We have to address to all these devices.

How big is the Indian market for you?

Countries like India, China and Taiwan have more potential. We would focus on having the best of technology at the best price. Last year, there were four crore units of smartphones sold in India. This year, it could be double. India is considered as a potential market to grow. We put in our resources for notebooks. And now we have ZenFones.

You are a late entrant in the cluttered Indian handset market. How’ll you catch up?

We sold 40,000 phones since our launch on July 9 as against the same number of tablets sold in one-quarter. We can compete not just on specifications, but also on user-experience and look & design of the phone. We aim at providing complete solutions even at prices as low as ₹5,999. The intent is to have the right product, at the right price. And then bank on word-of-mouth publicity.

Who are your target consumers?

Earlier it was the youth. But then we found that there are a lot of feature phone users who would want to upgrade. The price difference is so small nowadays. So why limit ourselves!

We are targeting these people believing that the smartphone will be a mass device. Some would move to the ₹5,999 price bracket or jump to ₹9,999 segment.

Will you continue to sell through a mix of online (Flipkart) and off-line stores?

Yes. In the new digital era, you need the online channel; without ignoring the offline. Hence, there has to be a right mix and we are working towards it. Globally, offline sales are higher.

So will you leverage the existing Asus distribution and service centres network for selling smartphones?

The distribution channels in smartphone and PCs are separate in India. Similarly, servicing a smartphone is different from that of a notebook. Some, and not all, of the distribution networks and service centres will be leveraged. We have 130 service centres (for handsets)in India.

Any manufacturing plans in India?

We do not have a facility of our own. And, procure from China, Taiwan and some South East Asian countries. Handsets are imported to India. We have to talk to our OEM partners in this regard.

What would be your highest selling category between the sub-10k and 10k plus handsets?

We have four variants across screen sizes of 4, 5 and 6 inches.

Earlier if you asked, I would have said ₹5,999.

But, after our launch, the ₹9,999 category is the highest selling.

Any bundling offers across devices?

No. We found that end-users don’t like such offers.

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