ZTE counts on retailers to boost sales in Europe

ZTE, the mainland's largest handset maker, plans to sell more smartphones directly through retailers in Europe to improve its brand awareness, the company's head of mobile phones said.

"Right now, it's the operators in Europe who choose our brand," He Shiyou said in Stockholm this week. "In the coming three years, we'll make a transition from focusing on operators to focusing on the open market."

ZTE wants to boost the proportion of smartphones sold through non-carrier partners globally to 40 per cent over the next three years from 10 per cent now, He said. He declined to discuss specific retailers.

While most handsets in Europe are sold along with subscriptions by carriers, consumers often seek bargains at stores such as Carphone Warehouse.

Already a major brand in its home market, ZTE is less recognised by European and US consumers. The Shenzhen-based company is doubling its marketing budget this year and opening up new sales channels, moves seen as crucial for lifting revenue and profit.

"ZTE has to change the brand awareness in the market if they're going to expect any real smartphone growth outside of China," said Francisco Jeronimo, an analyst at IDC in London.

ZTE is the fifth-largest maker of mobile phones, selling 13.5 million handsets in the first quarter for a 3.2 per cent market share, according to IDC data.

Of those, 9.1 million were smartphones that can access the internet. Its 4.2 per cent market share in that segment put the company behind Huawei Technologies, which had 4.6 per cent, and LG Electronics with 4.8 per cent.

Samsung Electronics and Apple are the biggest smartphone makers controlling half of the market between them.

ZTE forecast its smartphone shipments will reach 45 million to 50 million units this year, compared with 35 million last year.

ZTE planned to sell its first smartphone using Mozilla's Firefox operating system through Telefonica next month, He said.