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Starting A Smartphone Company? Here's Your Guide To Success

While companies like Apple dominate all the headlines, it’s smaller companies like Xiaomi that make the waves.


These smaller companies prove that you don’t need millions and millions of dollars to make millions and millions of dollars. In fact, you just need that bright spark of an idea, and then you’re all set.



However, it’s not quite that simple - starting a business never is! And starting a smartphone business is a much more complex task than most.


The expensive nature of the products and the public’s demand for quality means that nailing it can be hard. On the other hand, the sheer popularity of these devices means that if you get it right, you’ll be booming. People replace their phone’s every single year, which gives you an unlimited supply of insatiable custom.


But you have to appeal to that custom first, and that’s not a walk in the park. Anyone could start a smartphone company, but starting a successful one? That takes ability. You’ll have to devise a USP, do your stock market research and create a product that won’t be dominated by the rest.


So, for those budding entrepreneurs and tech heads, here’s a guide to building a successful smartphone company.


1. Market Research


Try and find a gap - somewhere your product can fit


It’s utterly vital that you come at this with a USP (Unique Selling Point). Otherwise, what’s the point? You’ll be swallowed up faster than Algeria in the football World Cup.


But since the smartphone market is so crowded anywhere, is there really anywhere left to go? Is there any ground that remains unexplored. Well, in a word, yes. There are still plenty of angles to approach your smartphone company from, and each presents its own USP.


  • The budget smartphone


Apple may have tried its hand at this back in 2013 with the iPhone 5c, but let’s be honest; it wasn’t budget. Their marketing campaign revolved around the use of ‘cheaper’ plastic materials used to make the outer shell of the phone. Supposedly, this made the device more cost-effective.



But, to the consumer, this thing was still around $399 off contract, depending on where you shopped. Apple’s tendency for premium products meant that the 5c was still cheaper - but still costly. There isn’t really a super budget smartphone in the $100 - $200 range, and that’s where you could land.


  • The ‘recycled materials’ smartphone


This idea has kicked around before, but never really made it to full mainstream production. A smartphone shell, made from recycled materials, could provide exactly the USP and marketing approach you need.


We’re an eco-bonkers planet, that much is certain. By playing to these people, you instantly foster a heap of public goodwill. Who doesn’t love the environmentally-conscious company? You’ll look good without even doing anything.


Look at how your biggest rivals fare in different market conditions


Before you bound headfirst into this industry it’s important to understand it, and all the major players within it. By assessing how well companies perform at different times of the year, you will understand how your company can best set itself up.


  • Technology conferences affect company financial success


The most important part of running any successful company is to show off the products on a global scale. Your company will be no different - you must show your device to the world. By showing off your device, your company gains more interest and as a result, more money.

If we take a look at MoneyMorning.com, for example, we can see that Apple will get a market boost from the WWDC event. When technology companies go to these events and show off their products, public buzz is generated. This translates to pre orders and products spent. As a result, Apple’s investors will gain more confidence in the company’s future and pump more money into it.


So what can you learn from this? Well, attending industry events would be a good start. Nobody will know you exist unless you announce yourself to the world. But this demonstrates the importance of marketing not just to mass audiences, but to the dedicated tech audience.


  • Black Friday and holiday sales


If you focus on the most popular shopping dates of the year, you can make profits that will outscale your yearly total. At these times of the year, the market is desperate to buy something. They’re desperate for bargains and desperate to be offered the best deals you can muster.


For Sony and the PlayStation, the last Black Friday was the most successful in the company’s history. If that doesn’t tell you something, nothing will. By gearing up for these dates and planning deals and offers to coincide with them, your products will fly off the shelves.


You need to gear up your marketing machine for these times too. Let people know that they should come to you on Black Friday, and over Christmas. Put your offers and prices front and centre. As the PlayStation example proves, these sales will be your bread and butter.


2. Product Design



While it’s true that most smartphone sales stem from mainstream audiences, that’s not where you should place your focus. Rather, you should focus on the tech-enthusiasts of the world, the early adopters who will help you spread the word.


Did Apple get big overnight? No. It was the people that loved tech who tried their products, and recommended them to their friends. As such, a focus on people who enjoy technology would be a good place to start.


  • Powerful performance


And what do technology buffs value? Performance. Looks will help you sell the product initially, but performance will make you sell the product long-term.


A fast, easy to use operating system and high graphical prowess should be your main priorities. Focus on loading speed when designing your UI - fancy animations are all style over substance. Look at the way Apple has implemented multi-tasking, and make it even better.


  • User customization


Something that’s largely missing from the smartphone market is user customization.


Sure, we can choose a different color, but physically altering the hardware specs? It’s unheard of. This could go hand in hand with your USP and form your entire approach. Consider making your hardware fully customizable. Allow users to choose screen type, memory size and processor speed, among others.



Not only does this set you apart from the competition, but it makes you appealing to the audience that we discussed. It’s really those tech-heads who value spec customization, and this will start you out on the right foot.


And as an added bonus, user customization allows the consumer to stay within budget. HTC only offer phones at set prices - what if those prices are too high? By letting people choose their own components, you make them more likely to buy with you. You could be the only financially viable choice!


This also saves time and resources. Rather than you choosing products for the customer, the customer can choose their own. It makes your job easier!


3. Pricing, Marketing And Selling


The price of your smartphone will either make you, or break you. Too expensive and nobody will bite, and too low and you’ll be selling at a loss. However, I’d actually encourage that you do this.


  • Sell at a loss, make money on software


By selling at a slight loss, you’ll be able to undercut the competition for a similar product. A phone which would cost $700 from Samsung or HTC, being sold for $500 by you? The consumers will come flocking in. Sites like inc.com can offer you plenty of tips on selling at a loss, in case you end up floundering into a mistake.


And now, you can make your money off software and peripherals. This can include things like mobile apps, spare chargers and headphones. You should put the prices of these up slightly so that your losses are recouped.


Many companies adopt this strategy. Including Nintendo. They sold the Wii at a loss and made back their money on games. This allowed the Wii to be more affordable, which got it into people’s homes, which saw the software sales come flooding in.


  • Hold the product back


It’s important that you foster a demand for your smartphone. By holding a large portion of your inventory back, you create a hunger and a thirst which can drive more people to your door.


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Let’s say that I was shopping for a bottle of juice. I can’t find any juice anywhere, and I’ve looked at every shop on the planet. So, when I eventually find a single bottle, I’ll buy it, no matter the price.


By adopting the same strategy, people will come looking for you. And when you do decide to release another batch of phones, people will snap them up over fears they may not find one again.


4. Success


It’s not going to be an easy ride, but there’s no reason you can’t get there eventually. Did Apple, Xiaomi, HTC or Microsoft start off with an overnight success? No, nobody does. Any business endeavor takes dedication and time.


So hopefully, you’ve had a thorough read of this guide and are all set to go. Just remember to focus on your USP, the performance of the hardware and getting the right price point. If you create something that people truly want to use, the sales will speak for themselves.


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