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Poco mulls ecommerce, offline and category expansion in 2023; complete 5G phone under Rs 15,000 to take 2-3 more quarters | Exclusive

‘As more companies adopt 5G and a wide base of people start ordering their 5G device, it will eventually bring down the cost.’

Poco mulls ecommerce, offline and category expansion in 2023; complete 5G phone under Rs 15,000 to take 2-3 more quarters | Exclusive
Poco M5 (Photo credit: Saurabh Singh/Financial Express)

Poco has some big plans for 2023. The Xiaomi spin-off brand, which has been primarily online, wants to slowly but gradually scale up its offline presence while diversifying its product portfolio by venturing into new categories, including wireless audio and potentially even tablets. Getting into ecommerce is, also, on the agenda even as Poco looks to scale up the brand “to the next level.”

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From a 5G perspective, the brand has built up quite a wide selection of 5G-ready smartphones in almost all of the price brackets that it likes to operate in, starting from as low as Rs 10,000. A complete 5G phone under Rs 15,000 will take 2-3 more quarters, though, owing to the “5G tax” the chipsets demand at the time of writing. In an exclusive interview with FE’s Saurabh Singh, Himanshu Tandon who is India head at Poco, shares some rare insights into the brand’s journey so far and what lies ahead in the future. Excerpts.

In a sea of commoditised hardware, how does Poco differentiate itself?

We see a lot of similarities in specs [today] especially in the Rs 10,000-20,000 price range. So, what we’re trying to do is basically differentiate ourselves from a product industrial design (ID) and colour, materials, finish (CMF) design perspective. If you see the kind of look and feel of Poco devices that we have right now, it’s a clear-cut differentiator. We are the only brand who is selling a yellow [colour] phone and that has received fantastic response in the market. Not just that, we are trying to create a price to performance ratio which is unmatchable. We are working on 2-3 key models for next year especially in our upper-end series which can disrupt the market. Secondly, we have an online target group (TG). So, engagement and messaging to that particular TG is very, very important and critical for us.

Any plans for offline expansion?

A lot of people have come to us and asked why don’t we have an offline operation. So, we have done an interesting start in offline operation in Kolkata. We have opened a Poco exclusive service centre there which is not only a service centre but also a sales centre where you can buy our products. We are also proud to inform that it is India’s first pink service centre which is run by an all-women team. Even the back-end engineers are women in that particular service centre. We have also recently launched our second such sale and service centre in Mumbai. If all this scales up, we will open offline centres in many other parts of the country. We are taking small steps at a time to get into offline. But most of our TG is sitting in online. We have data points to verify that. We are the #2 player on Flipkart and #3 player in online space overall. Our main objective is to dominate online and become the leader in the space. That is our key task for the next one or two years.

So, how do you plan to scale-up in online beyond products and is ecommerce in the pipeline?

Our website [poco.in] is just an information website right now. Next year, we are certainly planning to explore other channels and ecommerce is in the pipeline. We are increasing our team size also and exploring other channels that make sense for us because in terms of scaling up the brand to next level in terms of delivering a huge volume next year, we will have to diversify from let’s say a Flipkart and explore some other channels as well. 

Expansion into other categories has been a long time coming for Poco. What is the challenge there?

In the last one to one and a half years, there was some supply chain disruptions which did not allow us to get into other categories. But expanding the portfolio is one of the key top three priority areas for us next year. We are exploring a lot of IoT and other categories where we can become a disruptor. TWS, audio products, tablets, we are exploring each and everything from that perspective but our main philosophy is to create the disruption with our internal metrics which is known as price to performance. So, once we get the right product, and the right fit in that particular market we are certainly going to launch it.

Where is Poco in terms of 5G-readiness and what’s your general stand on 5G in terms of affordability and use case in India?

From a personal perspective, I feel that transition from 4G to 5G will not be same as from 3G to 4G. 3G to 4G was a drastic transition and there were a lot of brands that were stuck with 3G inventory and it was very hard for them to liquidate. But from a 5G perspective, I feel that implementation or execution of 5G will certainly take some time and it will start from top down. For example, metro cities will start first and then Tier 1, Tier 2 and below, so execution will still take some time and the transition will not be immediate. There will be scope for 4G products, to be very honest, along with 5G products.

Making a good quality 5G phone is a little bit expensive right now. So, when you’re getting a 5G phone with let’s say an AMOLED screen, it is very difficult to price it under Rs 15,000. It’s because of the chipset prices. If let’s say a person wants a complete phone at an affordable price, we will still have to offer a 4G phone. It will take some time for 5G to get implemented in certain markets and it will take some more time for 5G chipsets to be affordable at that price point so that people can enjoy the overall experience of the phone. It will take around 2-3 more quarters to get a complete 5G phone under Rs 15,000. As more companies adopt 5G and a wide base of people start ordering their 5G device, it will eventually bring down the cost. But right now, you will have to certainly bare some extra cost for a 5G phone. So, there will be scope for 4G products also, but 5G will certainly become a hygiene from a long-term perspective.

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