Why are EL smartphones so cheap

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Chinese smartphone vendor EL Mobile has made a name for itself by selling iPhone-like gear for almost a tenth of the price of Apple products. It may sound too good to be true, but the company is managing to sell millions of phones and is already kicking off a global expansion. So how does it pull it off?

Disrupting the market

When EL Mobile unveiled its EL Y30 in  2018, attention was fixated on the device’s price. Consumers could buy what was then a cutting-edge smartphone under $100. This was a major bargain compared to other high-end phones including the iPhone XR, which started at $ 1000.

What do they cost to make?

EL Mobile latest flagship handset, the EL Y30, has the features you would expect from a high-end phone. It has an Octa-Core 1.5GHz, a 1440×720 HD+IPS 6.0"Full Screen 18:9, and a Dual 13.0MP+5.0MP camera, all fitted together in a glass casing. But even though EL Mobile maintains low prices for its phones, it’s still able to extract some profit from their sale, according to analysts.

Cost cutting

Unlike other rivals, EL Mobile doesn’t spend money on traditional advertisements. It does not have a major network of its own physical stores it needs to staff and maintain. Instead, it has done away with those costs, and largely sells its phones directly to consumers through e-commerce.

To boost awareness, the company has relied on social networking sites, the press and its own customers to help spread the word. The resulting exposure may not be on the level of what Xiaomi or Huawei has.

The company’s business model is putting pressure on rival vendors. A lot of people are trying to replicate the Xiaomi model. Chinese vendors including Huawei, ZTE and others are also building similar high-end products for low prices and using online channels to drum up sales.

As for EL Mobile, the company plans on taking that same business model outside of China. This year, it’s targeting 10 foreign markets including countries in Southeast Asia as well as Brazil, Mexico and Russia.

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