The FINANCIAL — China made cell phones that are cheap and look nearly the same as global brands are significantly decreasing the sales of the original products on the Georgian market. Local retailers say that customers have become more price-oriented while official brand retailers claim their sales to be still on the increase.
“I purchased a dual SIM card mobile for just GEL 150 with Bluetooth and 3D logos on it. Plus it has a touch screen and 2.0 megapixel camera. I already have one Nokia, but I wanted to minimize the costs and inserted 2 cards with low tariff operators – Beeline and lai-lai,” Levan Rtskhiladze, 36, told The FINANCIAL.
Chinese patents have appeared in one of the shopping malls Kidobani, located close to Tbilisi’s Central Market Place. There are over 5 cell phone retailers that sell patent versions. Shop owners don’t name the direct suppliers, but say the phones are imported from Dubai.
“These cell phones are 3, sometimes 5 times cheaper than the originals. Just imagine, I can offer a patent version of Nokia 8800 Arte for GEL 350 while the originals cost from GEL 2,000-2,100. Obviously it won’t have a gemstone navigation key or leather finish, but the rest is the same as the original. As for features, there are limited options, but for those who would like to buy a 5 times cheaper Arte with 95% of the same look – why not?” says Giorgi Abutidze, Manager of one of the cell phone shops.
Original mobile phone brand sales slumped when Georgian banks stopped issuing instalments.
A representative of Elitel, one of the leading cell phone retailers and distributors in Georgia states that the issue here is the level of trust between the seller and buyer and not the price.
“We have official suppliers and for this reason we take full responsibility for the price and quality. As we are official distributors we don’t import Chinese products. Of course there are different types of buyers with a different demand, but it’s obvious that you shouldn’t mislead them by saying that Chinese patents are of the same quality features as original ones. At our shops customers can purchase mobile phones starting from GEL 54 up to GEL 12,000,” Ia Gogoladze told The FINANCIAL.
“Our main objective is to satisfy our customer’s needs. Some other retailers on the market often mislead customers in their advertisements. Elitel is always trying to live up to its promises. For us satisfied customers are our main priority. We sell high quality products and are constantly trying to improve service quality at our retail shops,” she says.
“These phones are not the same as the originals; they don’t have as many functions as the real versions by famous brands. We don’t offer guarantees for these phones, but they are still popular because of their low price. Some of the phones have problems with sending SMSs, for others their video capture is lower. But they do have a louder sound; you can watch TV and listen to the radio without any further instalments or accessories,” claims one of the shop owners at Kidobani.
There are two versions of the Nokia 8800 Arte, the standard one and the Sapphire Arte which features a gemstone navigation key and a soft leather finish.
The Nokia 8800 Arte is a much improved device compared to its predecessor. This is a 3G phone with a 2 inch 240 x 320 (QVGA) pixel OLED display, a 3.2 megapixel camera and 1GB of internal memory. Add in Bluetooth and a multimedia player, and the 8800 Arte is pretty much on-the-button for a contemporary 3G phone. Although the 8800 Arte runs the standard S40 operating system found in Nokia's “dumb” phones. There’s no WiFi, the camera lacks a flash and there’s no expandable memory either. So a GEL 1,650 difference doesn’t seem to be a bad deal for a patent.
The other mobile phone retailer on the market is Mobi, which has recently started an aggressive campaign. Mobi is selling Nokia, Samsung, Sony Ericsson, Motorola, LG, HP, HTC, i-mate and Wentto. But the people we contacted at Mobi found it difficult to name any responsible person to answer The FINANCIAL’s questions.
According to Elitel the mobile phone retail network is working well in Georgia. Continuous development and innovations supplement fast rotation of this product. As an Elitel representative claims, December was quite profitable.
“Our main marketing strategy is offering the best brand products on the market for the same or in some cases higher prices. Our prices are competitive and are corresponding to the quality that we offer,” claims Ia gogoladze, the Public Relations Manager of Elitel.
“Our monthly sales in December increased by 100% compared with November. In December sales are always rising and this year was no exception. Of course the financial crisis had negative effects, but still the results were optimistic,” Gogoladze adds.
“The planned sales in 2008 were successful before the war. During the August war sales decreased by 25%. The war had a direct effect on the amount of instalments, which also decreased. In our case, that of a mobile retailer, things got back to normal easier than in other sectors.”
The official partners of Elitel are: A4Tech; Adata; Apple; Defender; HP; Intel; Nokia; Motorola; MSI; Philips; Samsung; HTC; Toshiba; Fuji; Transcend; Kodak; Xerox; Creative; LG; Asus.
Currently Elitel has 12 retail shops in Georgia. According to the marketing department of Elitel in 2009 they’ve turned to effective management and higher quality service rather than fast growth. Elitel sells mobile phones of Apple, LG, HTC, Motorola, Nokia, Samsung, Sony Ericsson and Vertu.
Written By Levan Lomtadze
