Lenovo Group held a press conference on Sept. 28 to release VIBE, a high-end smartphone brand, together with VIBE X the first smartphone under the brand priced at 2,899 yuan ($471.27), aiming to expand business into high-end smartphone market, which is currently dominated by Samsung and Apple (report in Chinese).

Targeted at post-80s and post-90 users, Lenovo VIBE is consisted of two product lines dubbed VIBE Z and VIBE X, which will focus on function and product design, respectively.

QQ截图20130929165855Without too much emphasis on hardware, Lenovo touted VIBE X in terms of product design, user experience and software innovation. Liu Jun, vice president of the company, said that hardware configuration is no longer the sole criterion that defines a high-tier smartphone.

Lenovo witnessed booming development in Chinese smartphone market in the past two years, with market share surged to 13% from 2% a year earlier. The shipment of Lenovo smartphones reached nearly 12 million units in the second quarter of this year, up more than 130% year-on-year. Lenovo noted in its most recent earning report that it was the fourth largest smartphone maker in the world and No. 2 in China, only next to Samsung.

Despite the huge shipment, Lenovo still records losses from smartphone business, because most of Lenovo smartphones are entry-level handsets with low price tags and margins, which are released to snap up market shares.

The release of a high-end smartphone brand is a crucial step for Lenovo to shake off the brand positioning as low-end products so as to explore high-tier market, said Liu Jun.

The market for smartphones priced higher than 2,000 yuan is dominated by foreign brands in the past two years and domestic brands only account for 19% of the market share (source in Chinese). Several domestic companies has tried to change the low-end brand poisoning by releasing products priced higher than 3,000 yuan. But the sales of these products did not live up to their expectations, such as Lenovo’s K900.