Tecno Mobile’s Attacking Football

Tecno Mobile’s Attacking Football

Tecno Mobile likes football. And it is playing its favorite position – attack. Across Africa, as the football season begins, it will be wearing Camon CX Manchester City Limited Edition Smartphones jersey.  Guardian describes it elegantly thus: “Tecno Camon CX flagship is the latest in a line of photo-focused smartphones of the Tecno Camon series; best known for its premium camera upgrades and pocket friendly price tag. The Camon CX Manchester City Limited Edition features the City blue colour and includes the official crest on the reverse”.

Tecno is amazingly impressive and beloved by its fans. It has figured out how to make good smartphones that fit into most people’s budgets. It is treasured in Nigeria, welcomed in India, hailed in Pakistan, and loved in most parts of the developing world. It is very local and yet international in vision. It is scoring and winning the game of smartphone business in most parts of Africa. It offers a great lesson on how to unlock value in new markets through superior mix of quality and pricing.

The Phone Company for Fans

Tecno is one of the fastest growing mobile device brands in Africa. It started business in 2006, in Hong Kong, and today operates as a subsidiary of Transsion Holdings. It has won hearts with its balance on pricing and quality. Today, the company competes for market share against Samsung in the smartphone mobile sub-sector. And head-to-head, Tecno is doing very well, in Africa, against Samsung.

How did it do this? Tecno feels local while Samsung seems exotic and foreign. In deeds and ways, Tecno looks like the nice guy that just arrived in a party and everyone wants to shake his hands because he is sociable and accessible. It has figured out how to work with local partners like SLOT System while engaging hundreds of shops as outlets. You will not feel any elitism in the business model. Its goal remains scoring more goals and it does know how to do just that.

Tecno fans {source: Tecno}

We estimate that Tecno commands more than 20% market in most African markets (excess of 12 of them) where it does business, today. Its products are really good and it has the local chemistry.  Its latest product, the new dual front Led flash device, Tecno Camon CX, is a great product for Africa, when you consider the price and the quality.

Playing Football

Tecno wants to move up the branding pyramid and it has started that by working with Manchester City Football Club in England. Man City, as the club is called, is very popular in most parts of the developing world. The visibility and the equity it will get from this will help it fight any brand perception challenge from Samsung. While Samsung has branded with Chelsea FC England, Tecno is taking it to the next level: unveiling a phone for the lovers of the game and the fans of Man City. As Man City scores, Tecno expects to also score. But its scores will be counted in money.

Tecno Man City {Source: Tecno}

An Uncertain Future

Tecno looks good but it has a faulty business model. It is a hardware company in all elements of it. That is a very bad thing. It has no platform and technically does not own any customer. Tecno is very vulnerable and the company knows that. Selling hardware is a great business but over time, the limit catches on. From Nokia to Blackberry, we have come to believe that fans are not dedicated disciples because as soon as they get the phones, they forget the hardware. The experience is abstracted out of the hardware into the solutions the hardware supports. Facebook, Instagram, and more become the fun while the phone is the pipe. No one remembers the pipe that much unless you are iPhone or Galaxy.

Great modern hardware companies own their fans. Apple has shown that through its business model with App Store and its ecosystem of music and contents. It is not very certain what Tecno will do, if Apple in the next two years decides to offer a new category of the iPhone, moving the present relatively expensive one to iPhone Star but making one that can compete with Android devices. Provided Apple makes the design so unique not to reduce the value of the expensive version, it can still deliver the value for those that use iPhone as a status symbol. The cheap iPhone will help Apple win new customers in developing world. Alternatively, Apple may even name the cheaper version of its phone Apple, while keeping the name iPhone for the current expensive brand.

Huawei, Xiaomi and others are coming. And these competitors are very experienced and battle tested. There is no inherent defense which Tecno has built since it does not operate any platform. As we learn about the challenges of Xiaomi which has China as its main market, hardware is open to so much disruptions.

According to figures released this week by research firm IDC, Xiaomi saw sales of its smartphones drop by almost 40% in China during the second quarter of 2016 when compared to the same period in 2015. The overall Chinese market grew during the same period by 4.6% and while Apple suffered a similarly large drop in sales, Xiaomi’s real competitors in the mid-to-low end of the market – Huawei, Oppo and Vivo – all saw significant growth.

In the 12 months following its record-breaking valuation, Xiaomi missed smartphone sales targets — twice — as well as revenue targets. According to analyst Richard Windsor revenues could drop a further 10-20% in 2016 to give Xiaomi a valuation of just $3.6bn.

These are the major problems ahead for Tenco as it operates in Africa:

  • Africa does not really have much of phone brand loyalty. So, they can switch very fast for good deals. As people buy these phones, if they are not tethered to any ecosystem, they can be lost to the next big thing that offers more value. The way people migrated from Blackberry to other brands should be a huge concern for Tecno,
  • Huawei is a beast which is waxing stronger across the globe. It is closing up with iPhone on total phone shipment; Samsung remains the leader. These firms will sooner or later begin to put interests in Africa. That will be a challenge for Tecno which is relatively small.

According to the latest statistics from analyst house Canalys, Apple shipped 41 million iPhones around the world in the second quarter of this year – 2 percent up from the same quarter in 2016. Samsung remains the leader of the pack but with flat growth, shipping 79 million units in the quarter.

However, Huawei shipped 38 million smartphones in Q2, up 20 percent year-on-year. Oppo and Xiaomi, two other Chinese brands, also showed tremendous growth, securing their fourth and fifth places with 44 percent and 52 percent growth respectively.

  • Thin Margin: Part of Tecno strategy is its thin margin. The phones are really affordable and that means it is leaving money on the table. How far that strategy will carry it remains to be seen. It cannot truly afford this strategy when it does not run any major platform which can cover the cost of the small margin from hardware. It needs to fund growth and it needs to improve margin, across board.

But no one can discount Tecno which relies on its fan base to  design the excitement and the hype for its products. It is very good at that in Africa and especially in Nigeria. Being close to the fan, using word-of-mouth recommendations on social networking sites, is something we cannot take away from it. But will that be enough? I do not know, but one thing I know: Tecno has many things going positively for it, and it innovates, but until it can lock some of its fans, it will remain vulnerable. That offers a future for the brand.

Nnamdi Ezeigbo, Part of the Brain Behind Tecno

Thinking of Xiaomi

The paradigm of Tecno success mirrors that of Xiaomi. What we witness in Africa was the same that Xiaomi enjoyed until the global players took notice.

Xiaomi’s meteoric rise was based on one simple fact: It was able to produce smartphones with premium hardware and features which cost a fraction of those on sale from Apple or Samsung. However that advantage rapidly ebbed away when multiple manufacturers followed suit and produced their own smartphones which offered premium specs at low prices.

Tecno understands this problem and that is why it is moving its product categories upside while making sure the price is not lost in the strategy. Affordability of the phone cannot be the only strategy. It must have many elements of other things to compete. It will need to continue to expand its product lineup and most importantly find a way to own a platform: I have recommended the acquisition of iROKOtv to merge its hardware with a platform that can help boost the low margin it present commands on the hardware.

 All Together

Tecno can be the heart of connected everything but the problem is that Africa is not matured for that type of business. Even the content business will be hard for a place where data is a premium. But this company has built a business with good mastering of how the mobile business can be done in Africa and other developing parts of the world.So, I will like to believe it has a plan when more global players take more interests in the continent. If it does, it will continue to score more goals on its  bank statements with more wins across Africa.


1. Advance your career with Tekedia Mini-MBA (Sept 13 – Dec 6, 2021): 140 global faculty, online, self-paced, $140 (or N50,000 naira). Click and register here.

2. Click to join Tekedia Capital Syndicate and own a piece of Africa’s finest startups with a minimum of $10,000 investment.

3. Register and join me every Saturday at Business Growth Playbooks w/ Ndubuisi Ekekwe (Sept 4 – Oct 23, 2021), Zoom, 4.30pm WAT; costs N20,000 or $60.

Share this post

7 thoughts on “Tecno Mobile’s Attacking Football

        1. Ladispeaks, let me know of other fact issues. Once I know, we would update. Thank you very much for helping. But reading the web, he has been noted as founder. But since you are disputing, I have updated to remove the word “Founder” after him. More fact issues, let me know.


Post Comment