An inconspicuous mobile phone manufacturer sold over 94 million smartphones in 2023 and achieved a revenue of more than 60 billion yuan, rapidly rising to become the fifth-largest mobile phone manufacturer in the world. The company that owns three major brands TECNO, itel, and Infinix is Transsion, which has a market share of over 40% in Africa, yet its products are not sold domestically in China.
Although Apple led the market by selling 234 million phones in the same period, Transsion was the only company among the top five mobile giants to achieve positive growth, with a rate as high as 27%. Transsion is expanding its market and gradually entering regions such as South Asia, Southeast Asia, and Latin America.
Zhu Zhaojiang climbed to the top sales position in the North China region of Bird within three years of joining the mobile phone department and entered Bird’s management as a sales manager with his excellent sales ability. In 2003, he took on the responsibility of expanding overseas markets and successfully sold 6 million mobile phones in just two years. This overseas market experience laid the foundation for Transsion’s marketing in Africa. Zhu Zhaojiang’s position at Bird was promoted all the way to vice president.
In 2006, Zhu Zhaojiang left Bird and founded Transsion mobile phones. Considering the saturation and fierce competition in the Chinese mobile phone market, he turned his attention to the African market, a new field to be developed. Subsequently, in 2008, Transsion introduced its first product T780 in Nigeria, aware of the limited consumer level in the African market, it emphasized cost-effectiveness, and made sufficient local features such as dual SIM standby, selfie cameras, etc.
Transsion’s pursuit of localization has established its footing in the African market without being affected by the presence of international brands like Samsung. Although Samsung had a factory in Africa, it did not launch customized models for the market demand. In contrast, Transsion focused on improving features to suit local preferences. According to a 2021 Guosen Securities research report, technical innovations were made in aspects such as facial features of black people, image beautification, dual and quad SIM standby problems, etc.
Transsion is not only steadily advancing in the African market, but in recent years, it has also been actively expanding into emerging markets. Especially in the key year of 2023, Transsion achieved significant growth in several emerging markets, maintaining a leading position in markets in Africa, Pakistan, Bangladesh, the Philippines, and other places. According to IDC reports and Canalys shipment reports, Transsion achieved 23% growth in the fourth quarter of 2023.
While gradually moving out of Africa, Transsion’s development strategy has been progressively implemented, spreading its products throughout Third World countries in Asia and Africa. According to recent reports by Alpha Factory, Transsion’s internal data indicates that in the first three quarters of 2023, its revenue from Africa fell to 35% of total revenue, while revenue from the South Asian market accounted for 21%. In national markets including Pakistan and Bangladesh, Transsion has already secured a leading position.
In recent years, the rise of Transsion Holdings in the tech market can be described as a miracle. Since its successful listing on the STAR Market in 2019, the company has achieved significant revenue growth in just four years, soaring from an initial ¥25.346 billion to over ¥60 billion, with an astonishing annual compound growth rate of more than 30%.
According to recent public information, Transsion’s total mobile phone shipments in 2022 were approximately 156 million units, not only surpassing Xiaomi’s shipment volume for the same period but also ranking third in the global mobile phone market. When focusing specifically on smartphones, Transsion ranked sixth globally in 2022.
Looking forward to 2023, although Transsion’s annual report has not yet been released and detailed shipping data has not been disclosed, information revealed by the International Data Corporation (IDC) indicates that Transsion’s market position has significantly improved. According to reports, its smartphone shipments reached 94.9 million units, raising its global market rank to fifth with a market share of 8.1%. Particularly in the fourth quarter of the year, Transsion’s smartphone shipments were 28.2 million units, an increase of 68.6% quarter-over-quarter, thus climbing to fourth place globally for the first time, surpassing both OPPO and vivo.
It’s worth noting that Transsion is not very well known in the domestic Chinese market. An employee of Transsion revealed that the company’s products are mainly sold to poorer countries and are mostly priced as cheaper models and feature phones. A Transsion employee in Southeast Asia pointed out that most of the company’s mobile phones are sold for about ¥1000 when converted to RMB, and even the most expensive folding screen phones are priced at around ¥4000 in RMB. In the domestic market, smartphones in the same price range generally can only buy entry-level flagship models; most brands’ folding screen phones are usually priced above ¥6000.
Moreover, an industry insider working in African telecommunications pointed out that due to the generally high prices of mobile phones locally, Transsion’s favorably priced phones have become the preferred choice for the locals, with basic prices not exceeding ¥1000. Additionally, due to limited consumer spending power, there is a very robust second-hand phone market, with many second-hand phones that have been phased out in China ultimately entering the African market.
Although feature phones have less profit, Transsion has been actively exploring new markets such as South Asia, Southeast Asia, and Latin America in recent years and is focusing on smartphones as the core of its business development. It is said that Transsion has entered the top four in the Indonesian market. Transsion’s sales network covers more than 70 countries and regions worldwide, remaining the top seller in the African market for several years in a row, and with a market share exceeding 40%, it has a considerable lead over Samsung, which is ranked second.
In the “Top 100 Most Loved Brands by African Consumers of the Year 2023” released by “African Business,” the three mobile phone brands TECNO, Infinix, and itel, under Transsion Holdings, were ranked 9th, 29th, and 30th respectively. TECNO, in particular, has been leading among Chinese brands for several years.
Recently, Transsion has attracted widespread attention for generously distributing year-end bonuses. According to a notice released by the company, it was decided to increase all employees’ year-end bonuses by 30%, making Transsion the latest company to be known as a “fairy company.”
Recently, a PowerPoint presentation from Transsion Holdings’ autumn 2023 recruitment lecture was shared by users on global social media platforms. The document revealed that Transsion offers a salary of 310,000 to 380,000 RMB for fresh undergraduate graduates and 360,000 to 430,000 RMB for master’s degree holders in their first year, while there is no cap for salaries at the doctoral level.
According to a Transsion employee stationed in the Philippines who spoke to the media, local salaries for bachelor’s degree holders can reach 330,000 RMB. Although the starting salary provided by Transsion Holdings cannot compete with several well-known overseas mobile companies in China, the relatively low entry threshold allows many graduates from non-top-tier universities to join.
A Transsion HR person on social media stated that the company hardly ever lays off employees dispatched to third world countries, primarily due to the relatively harsh conditions in these nations. Despite the fact that Transsion’s main products are budget phones, there is a general misconception in the market about the company’s profitability.
In the mobile phone industry, high-priced products often mean larger profit margins, and even with low gross margins, a high-priced phone can yield much more profit per unit than lower-end models. Because Transsion’s main products are priced lower, this somewhat limits their profitability. Statistics show that the average selling price of Transsion phones is just over 500 RMB. According to the latest financial report data, Transsion’s revenue in 2022 was 45.696 billion RMB, with a total shipment of 156 million units, including feature phones, meaning each phone contributed less than 300 RMB in revenue on average.
In the domestic market, mainstream mobile phone brands such as Xiaomi have surpassed Transsion in terms of profits and market valuation. Xiaomi Group’s revenue and net profit for the third quarter of 2023 are equivalent to Transsion’s entire year’s revenue and net profit. Reflecting on employee compensation and benefits, the remuneration in overseas markets offered by Huawei and Xiaomi is generally higher than that of Transsion, and some employees revealed that their income could double after leaving Transsion and joining Huawei.
Transsion’s rise relied on opportunities offered in many yet-to-be fully developed markets in Asia, Africa, and Latin America, markets that have not been rooted by giants, while top phone manufacturers tend to focus more on the higher-value mature markets. According to IDC data, as of the third quarter of 2023, the average selling price of mobile phones in China has reached 3,480 RMB, with the value of the high-end market becoming increasingly prominent.
As the smartphone market becomes increasingly saturated, domestic brands such as Xiaomi, OPPO, and vivo are stepping up their investments in emerging markets, putting considerable pressure on Transsion. Canalys statistics indicate that in the fourth quarter of 2023, Xiaomi, OPPO, and realme’s growth rates in the African market reached 88%, 156%, and 105%, respectively. Facing such a competitive situation, Transsion, which rose by relying on a low-price strategy, must continue to double down on efforts to make their products more intelligent and high-end in order to surpass other top manufacturers in terms of overall revenue and profit.
Discussing today’s topic: Have you heard of Transsion mobile phones? What’s your opinion on them? Feel free to leave a message in the comments section to share your views and feelings.
