In Q1 2023, Google’s Pixel series reported remarkable growth in the Japanese market, managing to surge against the overall shrinking smartphone market trend. Its global shipments experienced a remarkable 67% YoY increase, powered predominantly by robust sales of the mid-range Pixel 6a and flagship Pixel 7 and Pixel 7 Pro models. This shift towards Google’s offerings has notably reshaped the brand’s global distribution and has led to a drastic increase in the Japanese market’s contribution. However, these dynamics have posed new challenges for the tech giant’s strategy for further market expansion.
Japan Becomes Top Market for Google Smartphones
Boosted by impressive sales, Google’s smartphone shipments in Japan increased nearly fivefold in Q1 2023, reaching an all-time high share of 34% of the brand’s overall global shipments. This surge pushed Japan to secure the top position in Google’s smartphone market, surpassing the US market, which witnessed a slip from 51% to 31% in its share. Despite maintaining similar shipment levels of Google smartphones compared to the previous year, the US market was overtaken due to the growth in Japan’s contribution.
Pixel 7a: A Rising Star in the Smartphone Universe
The Pixel 7a’s recent launch has seen a 74% increase in cumulative sales during its first three weeks compared to its predecessor, the Pixel 6a. The sales surge in the Japanese market has been driven by the device’s high cost-effectiveness, its upgraded Tensor G2 processor, superior camera performance, and RAM. Furthermore, the Pixel 7a, which boasts specifications comparable to the flagship Pixel 7 series, is offered at roughly 24% lower price, making it an attractive choice for price-conscious consumers.
Unlike the Pixel 6a, which was available only through SoftBank and AU, the Pixel 7a is available for sale through all three major carriers in Japan – SoftBank, AU, and DOCOMO. This expansion of carrier partnerships significantly contributed to the successful sale of the Pixel 7a, further strengthening the brand’s presence in the Japanese market.
Google’s Momentum Fueled by Withdrawal of Local Brands
- In Q1 2023, Google achieved its highest-ever market share in Japan at 9%, surpassing local brands such as Sharp and Sony to secure the second position after Apple.
- With the withdrawal of local brands such as Kyocera, FCNT, and Balmuda from the smartphone market, the dominance of US brands like Apple and Google in Japan is expected to strengthen further.
- The withdrawal of these local brands is likely to sustain Google’s growth momentum, despite the maturity of the Japanese smartphone market, which may impose some limitations on Google’s strategy for expanding its global market share through the Japanese market.
Google’s strong performance in Japan’s smartphone market not only indicates the growing appeal of the Pixel series but also reflects the shifting dynamics of the global smartphone market. This trend underscores Google’s strategic push into markets previously dominated by local brands and highlights the power of innovation and strategic partnerships in driving growth. Furthermore, it elucidates Google’s efforts to diversify its market presence beyond traditional strongholds, such as the US, to tap into the potential of growing markets.
For more detailed insights, visit Counterpoint Research.