Abid Hussain Barlaskar

"I don't want to spend on fancy marketing": realme CEO Madhav Sheth

Smartphone manufacturer realme has made its space among the top five brands by market share since its launch a year back. It did so despite not conforming to category codes of splurging on media.

Smartphone brand realme, which started operations in the second quarter of 2018, entered the top five brands in Q4 the same year, reaching more than four million users in India. realme belongs to the group of phone brands from Chinese electronics giant BBK Electronics (Oppo, Vivo, OnePlus). Originally a part of Oppo, realme separated in mid-2018 to become an independent entity.

Counterpoint reports suggest that realme became the third largest player in the online segment with 11 per cent market share in Q1 2019. Originally an online-focused brand, realme recently initiated its offline operations. Despite a slight drop in market share, the brand maintained its position in the top five holding the fifth position (7 per cent) in Q1 2019. Xiaomi held 29 per cent and Samsung 23 per cent (Counterpoint). For a quarter (Q4 2018), realme managed to surpass parent company Oppo with a market share of 8 per cent.

"I don't want to spend on fancy marketing": realme CEO Madhav Sheth

Despite not splurging on advertising, the brand has managed to make headway. But how will the realme team sustain growth? Reportedly, the brand aims to sell 15 million handsets in India in 2019. Madhav Sheth, realme's India CEO (former director, sales at Oppo) listens closely to his consumers' conversations on digital channels. He maintains a monthly interview session - 'Ask Madhav' - on YouTube to address queries that surface on platforms like Twitter.

Edited Excerpts

Brand realme has witnessed significant and rapid growth since its launch in 2018. What do you attribute this to?

It is not rocket science. The most important aspect is the product and second, the design. Designs were not given a priority by brands for sub-10k/15k models, but specs (mostly on paper) were. I differentiate between specs (on paper) and the actual user experience. Understanding the needs of the customer and providing the right product is core. We stuck to basics and that's it. Brands are moving away from the core basics while experimenting with newer ideas.

What role did advertising play?

It's a medium for awareness and to communicate solutions for the consumer's pain points. We have experimented with TV and print, but digital has been the major way of reaching users. We are exploring traditional mediums and want to reach out to Tier 2 to 6 towns. Reach is important and would look for the most optimised option. If a 100 million people get to know realme today and are able to compare it with X brand tomorrow, they will understand better.

What about agency partnerships? You don't have an advertising agency on board.

Most of the creative work happens in-house and we believe in the idea and good content. If the content is good, whatever the cost, we will go for it. I don't want to spend on fancy marketing. If an agency has good content or ideas, they can pitch anytime.

Tell us about 'Ask Madhav'?

Today, people can connect directly to the CEO of a company via social media. Comments on social media reflect consumer sentiment, which is very important. Thus, Ask Madhav to answer queries. We pick the most-asked questions and then answer them once a month. These, together with a survey agency, help in understanding user requirements, colour variants they are interested in etc. Users can provide feedback on what exists, but we find out what can be done further.

How do you plan to sustain the growth?

We plan to stick to the core. Trying unconventional stuff is not a problem, but one must not forget the conventional basics and the ground reality. This is specifically important for this business.

OnePlus - realme's cousin seems to ride on "community-based marketing". What about you?

We already have a strong community and 'Ask Madhav' is meant for them. We want community-driven marketing, but we will do conventional too. Users research a lot and it has become the most important criteria for the industry. We want to be available at all possible touchpoints.

You seem to have Xiaomi in your crosshairs, given the Twitter skirmish...

Although it looks like that, ambush marketing is not our objective. Our primary objective is to let users understand the difference between a very high level of spend marketing versus a real product. Within our team, we have a very clear policy that we will not target any particular brand. Focussing on one brand narrows vision.

realme has been selling online, but has recently decided to sell offline too...

Many users are sceptical about buying online. The most important reason is 'touch and feel'. We need to have a place for them to go and have an experience. Also, there are a lot of pin codes in Tier 2 to Tier 6 cities where e-commerce doesn't deliver - Jammu, parts of West Bengal etc. We need to reach there too.

The smartphone space seems pretty crowded and brands are almost at par. How do you stand out?

Of over 350 registered brands, 330-340 have shut shop because it wasn't about the price-to-performance ratio, but price alone. Performance doesn't just come from user experience; it comes from the commitment of service, from the design, the specs, and from the many firsts that a brand does.

All of our models have different designs. It was never 'a low-end model is of low priority in design'. I have to ensure that users of the realme 1, launched on May 24 last year, get their promised updates. We also have 360-degree service support, which can be delivered to your doorstep. I would rather spend on providing services which give users peace of mind and our return rates are lowest in the industry as of now.

Selling online vs offline.

It doesn't change much. Offline consumers get the touch and feel of the product. It involves the selection of stores, putting stocks where the population is, the store's experience, all of this while also controlling the costs. We are in the early stages on that front.

Please describe the ideal realme user?

It is about targeting people who understand the price-to-performance ratio and are able to convince and influence others. Currently, they are in every home in Tier 1 to Tier 3 cities. They are young office-goers, college students, mainly males aged 15-30. Males because females mostly depend on their father, brother, boyfriend or husband to buy a device or seek recommendations. Males who are ready to take a leap from conventional to unconventional. They might have stuck to an X brand due to trust, but are willing to try realme.

What happens behind the scenes at realme when a rival comes up with a new innovation or model?

We understand what's a marketing gimmick and real usage. If it's real, we appreciate it, by heart; we pay no heed if it's a gimmick. If it's real, our teams start working on the new feature. A lot of the features are promoted just for the sake of marketing and have no practical use. Certain words are over-abused for the sake of marketing.

What external factors influence brand realme?

Content is the main thing. We have 4G at the lowest prices in the world and it would depend on the content consumption experience.

How is the India market different from China or similar regions?

India is a price-conscious market. The ASP (average selling price) of a product in China is higher. The economy is advanced and hence, people have a better buying capacity. If the ASP in India is around 9-10k, it would be around 20k in China. The product selection and launch depend on this. There is no point in launching a model like the C2 priced at INR 5999 in Europe. The users there are matured, second-third time buyers and wouldn't compromise on experience for a lower price. In India, especially in Tier 2 and lower cities, there are more first-time smartphone users who will take some time to reach that stage.