Lava International to sell new brand on own online platform

NEW DELHI: Home-bred Lava International will soon launch a sub-brand of its popular Xolo brand of smartphones exclusively on an e-commerce platform it is developing, as the country’s third largest smartphone maker strives to replicate the success of foreign rivals Xiaomi and Motorola’s ‘online-only’ strategy.

Vishal Sehgal, co-founder and director at Lava, did not reveal the name of the new sub-brand but confirmed that its launch and that of the e-commerce site will coincide.

With the launch of the website, Lava will become the second Indian smartphone maker after Micromax to follow in the footsteps of the global majors, which have tasted immense success through their online-only model in India’s surging but ultra-competitive smartphone market.

Micromax-owned Yu Televentures is selling its first smartphone, Yureka, exclusively through Amazon since January 13.

Lava’s move also follows Xiaomi’s successful strategy in China, where it sells via its own e-commerce site. Xiaomi, which has used the model to dethrone Samsung as China’s largest smartphone maker, plans to open an e-commerce site in India as well. Xiaomi not only sells handsets online but also cultivates its customer base through its own software, services and entertainment offerings.

Sehgal, however, said that Lava is launching the e-commerce website to bring price stability for its products in the country. “We don’t want to do e-commerce for discounting and reducing the price, rather reach out to people who want to interact with the brand digitally,” he said.

E-commerce is rapidly changing the traditional sales channels for the smartphone industry in India as well as in other markets. The disruptive online-only strategy has not only helped Xiaomi penetrate the Indian market but has also helped Motorola to break in to the top five smartphone vendors in the country.

Chinese handset makers Huawei and ZTE, along with some India brands, have also started focusing on their online businesses.

Sehgal said Lava’s e-commerce site will also provide customer support services such as remote diagnostic of the device.

Lava’s Xolo has already followed in Xiaomi’s footsteps by introducing its own Android-based propriety User Interface (UI) and the company is now looking to pump in Rs 15 crore towards the development of the UI.

According to market research firm IDC, Lava is one of the fastest growing handset vendors in India and has witnessed growth in both its brands ‘Lava’ and ‘Xolo’. At the end of the third quarter, Lava stood at the third spot with 8% market share, after Samsung (24%) and Micromax (20%).

When asked if the parent brand would also sell its smartphones through the in-house site, Sehgal said the backend capability can be leveraged by both the companies. However, Lava is a mass brand and would only evaluate the online strategy after Xolo’s online stint.