Baidu dethrones Alibaba as China’s top smart speaker vendor in Q1 2019

Baidu is in urgent need to find a new frontier and smart speakers are very good entry points for their services

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Baidu dethrones Alibaba as China’s top smart speaker vendor in Q1 2019

Chinese tech giant Baidu has quietly topped the Chinese smart speaker market with 3.3 million shipments in the first quarter of 2019, dethroning industry top dog Alibaba’s Tmall Genie, according to research firm Canalys.

Baidu, which only entered the smart speaker market with its own brand Xiaodu last June, sold 3.3 million units last quarter, accounting for roughly 16% of all global smart speaker shipments. Baidu’s main competitors, Alibaba’s Tmall Genie and Xiaomi’s Mi Ai Speaker, each shipped 3.2 million in the same period.

Baidu’s surprise ascend can be attributed to the company’s strong promotion campaign during a slower quarter for its competitors, Nicole Peng, VP of Mobility at Canalys, told KrASIA.

“E-commerce platforms usually pay less attention to the first quarter and most of their marketing is done in November during the Double Eleven shopping spree,” she said. “Baidu has used this slower season as an opportunity to overtake its competitors.”

The company’s stellar quarter sales were also partly attributable to its heavy investment in marketing promotion and aggressive subsidy regime, according to Peng.

Baidu spent USD 902 million in “selling, general and administrative expenses” last quarter. This was primarily due to increased investment in channel and promotional marketing, including the marketing campaign around the Chinese New Year, the company said in its latest quarterly financial report.

But against the backdrop of its dimming prospects in the PC and mobile search business, Baidu is in urgent need to find a new frontier and smart speakers are very good entry points for its services.

“It’s a very important node for Baidu,” Peng said, adding “it will make a lot of effort to compete for market share.”

Editor: Nadine Freischlad