The growth rate of mobile handset sales has started to plateau in China's main centres, prompting manufacturers to turn to third- and fourth-tier cities, according to a Nokia executive.
Colin Giles, Nokia's general manager for sales in China, said the fierce competition among domestic and foreign firms had branched out from the relatively affluent eastern coastal cities, and spread westwards and southwards across the mainland in the search for new customers.
'The marketplace right now is moving towards the smaller cities. This year especially we are starting to see sales move to the third- and fourth-tier cities and moving more to the southwest. Eventually it will spread to all of China where there is a population,' Mr Giles said.
He said the shift was also driven by an increasing consumer awareness in the more remote areas of the country and the falling prices of mobile handsets.
'There is a lot of marketing going on and people see their friends have a mobile phone and they want one, too,' he said.
To adapt to the change, Nokia last year increased the localisation of its mainland operations, developing distribution and marketing partnerships and customising its products to the market.