Ereneben makes dent in China's tech market

Consumers try ErenEben products at an electronics mall in Beijing.[Provided to China Daily]

Apple Inc's iPad may have met its first serious Chinese challenger in the tablet PC market in China: Beijing ErenEben Information Technology Co.

Analysys International, a domestic research company, reported that the Beijing-based company occupied around 5 percent of the market share in China in the second quarter of this year, fallingwell behind the commanding American brand.

Established in 2009, ErenEben - which roughly translates to everybody gets one - is very different from Chinese iPad copycats. ErenEben built its own tablet PC research and development (R&D) team in 2004, and launched its first portable PC on Jan 7, 2010 - three months before the iPad launched in the United States.

ErenEben only had a few stores in China at the beginning of last year. Now the company has more than 900 authorized dealers and has sold more than 150,000 products in the past six months.

Late last year, Legend Capital Limited and Tuspark Venture Capital Management (Beijing) Inc invested an undisclosed amount into ErenEben, the company says.

It was the second time that Legend Capital invested in ErenEben last year, pushing total investments by all venture capital to 56 million yuan (6.1 million euros).

The aim of the investment is to support the company in maintaining its market share and to help advance its technological capabilities.

According to an analysis by Zero2IPO, a service provider in the China venture capital and private equity industry, ErenEben occupies about 80 percent of the market share among Chinese tablet PC producers.

"We have to thank Apple for launching its iPad, because the iPad helped Chinese customers accept the concept of the tablet PC. And after the iPad heated up the market, our sales have increased rapidly," says Jiang Yufei, chief executive officer of the company.

But the company's target customer is very different from Apple's.

"We are aiming for Chinese business people over the age of 35, while most of Apple's customers are young people," Jiang says.

The core innovation of ErenEben products, designed for business usage, is a function called Mind Mark. It's a feature that gives users an experience similar to writing on paper, by using a touch pen on a touch screen.

"Most Chinese business people and government officials can't get used to using their fingers or a virtual keyboard to type. So we invented a function where users can use their own writing style ... even via e-mail," says Fang Liyong, chief operating officer of the company.

But the tablet PC maker should consider whom it is trying to target, says Zhang Yanan, analyst from Zero2IPO.

ErenEben "needs to do more research on the market and their (target) customers before they take the next step, as the 35-plus-age group of business people is still too broad."

Store locations are also a consideration for ErenEben's target market. The company didn't focus on the gray market or electronics bazaars such as Zhongguancun, which is well-known for its cheap prices and chaotic environment. Instead, ErenEben chose high-end shopping malls for its franchises, catering to the tastes of China's business elite.

Priced at 4,980 yuan, it has a competitive advantage over the iPad. An iPad with similar functions cost about 6,000 yuan in China's gray market. Only copycat versions of the iPad with the 3G connection function exist in China. IPads that use Wi-Fi to connect to the Internet range from 3,688 to 5,288 yuan.

"Price is the biggest advantage for ErenEben compared with the iPad," says Yu Bin, an analyst from Dratio, a Chinese research firm.

ErenEben considers customized service another difference between the American and Chinese companies.

"We can print the customer's company name on our case and even help them change the screen background picture to their CEO's face," says Fang from ErenEben.

As technology becomes a part of everyday life, ErenEben will need to stay current on what consumers want as well as enhancing the capabilities of each generation of its products to remain a top-seller in the electronics market.

"The company occupies most of the market share for the domestic tablet PC market, but when PC manufacturers rush into this market, ErenEben will face more fierce competition later on," says Yu from Dratio.