Huawei changes tack in Kenya with cheaper smart phones to boost market share

NAIROBI (Reuters) - China's Huawei Technologies [HWT.UL] has changed its strategy in Kenya this month to showcase an affordable $100-200 range of smart phones, hoping the increased sales will boost its local market share, the company's country manager said on Thursday. Huawei is ranked number three in the fast-growing local smart devices market, behind South Korea's Samsung Electronics and Tecno, owned by Hong Kong's Transsion Holdings. Derek Du, the local boss of Huawei, said the company had started offering three smart phones with retail prices starting at 8,999 shillings ($87) to 22,999 shillings ($220), as part of a strategy to lift its market share in that segment from 4 percent to 15 percent. "We did not pay attention to the models below $200 but this year we are changing the strategy to focus on both," he said. Safaricom, the biggest operator with 72 percent market share or 28 million users, said there are 13 million smart phones on its network, up from 10 million last year. Consumers have been giving up their well-worn feature phones to take advantage of relatively fast Internet speeds and applications such as WhatsApp and those that facilitate banking and taxi-hailing services. The new focus on the lower end of the market came about because the Kenyan consumer is "price-sensitive", Du said. "The $100-200 this is the key part we can play. If we can bring it up, it means we will also bring up the whole market share," Du said. He said that will help the firm to boost its overall market share to 25-30 percent, from the current 14 percent, in the next two years. The annual average Kenyan wage is $1,200, official figures show, so most people cannot afford expensive smart phones. Huawei previously focused on the mid-range of smart phones, where it has a 30 percent market share. It also sells the premium "Mate" series phones in the Kenyan market for the well-heeled. Huawei, which is based in Shenzhen, China, competes with Apple and other devices vendors for global consumers. "Kenya's economy is very stable. It attracts many investors to it. Surely, we will pay attention to this market," Du said. (Reporting by Duncan Miriri; Editing by Katharine Houreld/Keith Weir)