Smartphone critics often say that HTC builds the best Android phones, and then blame the company’s lean marketing budget for poor sales.
After seeing the advertising budgets of the top seven U.S. smartphone makers in 2013, that’s an entirely plausible explanation.
But a quick look at HTC’s current advertising approach shows a huge reliance on social media and word-of-mouth-like advertising — and not a lot on paid for media, like billboards, TV commercials and radio spots.
So, does the huge gap in spending between the two Android-phone makers matter?
Last year, the Taiwanese phone manufacturer, with U.S. headquarters in Bellevue, spent $76 million, or roughly 20 percent of the marketing budget of Samsung, reports The WSJ, which summarized findings from a report conducted by Kantar Media.
At that level of spending, HTC’s budget ranked sixth in the U.S., falling only one step above LG Electronics and one below BlackBerry. Samsung spent the most, or about $363 million on all U.S. phone ads to surpass Apple, which doled out $351 million.
How will this year compare?
HTC is banking on the all-new HTC One (M8) to return the company to profitability, so the question is, will its advertising spending increase?
A spokesperson did not immediately reply to our email seeking comment, but a quick look at what they are spending money on suggests that budgets aren’t soaring. Instead of a lot of expensive paid media, HTC is relying a lot on a consumer’s willingness to seek out information, rather than be inundated by it.
For instance, the company’s new U.S. commercial features British actor Gary Oldman, who tells viewers to “ask the Internet” about the company’s flagship device (he literally waits for seconds while the viewer supposedly forms their own opinions).
I also got an email today with the subject line: “The Internet is talking about us again.” Inside the message, there’s an image of the all-new HTC One’s phone screen, which is open to the browser, where it features links to positive reviews of the phone on blogs, including Android Central, Tech Radar and Cnet. The advertisement says: “We can’t make this stuff up.”
Can that good Internet vibe be enough to bridge the gap between it and Samsung’s massive soapbox?
It’s unlikely, however, truth be told, the thrifty approach probably doesn’t hurt, either, especially as it tries to return to profitability. If you don’t spend the money, you don’t have to make it. But obviously that hands-off marketing approach has to work.
The third largest media buyer last year was Nokia, which spent $221 million; Motorola was No. 4, spending $189 million; and in fifth place, is BlackBerry, which spent $90 million.
Interestingly, the WSJ points out that the ad binge seems to have helped Microsoft, LG and Nokia the most. The Finnish phone maker saw the biggest market share increase in percentage terms, according to researcher comScore.
Here’s the Oldman commercial: