Case to the future

US-based electronics protection case maker banks on China's burgeoning smartphone demand for growth

How many times have you accidently dropped your mobile phone on the ground? If you find your hands are too slippery to hold on to the phone, buying a protective case for your gadget might be a good idea. But how much are you willing to spend on a phone case?

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According to the United States-based electronics protection case maker OtterBox, paying $60 for the 360-degree protection of an iPhone 6 seems to be a reasonable offer.

The Fort Collins, Colorado-based firm is sniffing business opportunities in China as more Chinese customers are buying smartphones worth more than 5,000 yuan ($814).

"We are confident of capturing at least 5 percent of the Chinese smartphone market in the coming years," said Stephen Nisbet, managing director of OtterBox Asia Pacific. "We have received several queries from Chinese consumers and I think it is an opportune time for us to tap opportunities in the world's largest smartphone market."

The 15-year-old company is opening its first office on the Chinese mainland in a busy business district in Beijing soon.

Unlike most of its peers, the US company can consider itself lucky, considering that it hardly faces any competition from Chinese companies in its niche area of operations. The high-end smartphone case market is dominated by multi-national firms like Spigen SGP and other fashion brands. Chinese phone case companies are present mostly in the low-end market, where the profit margins are slim.

OtterBox is already the largest maker of smartphone cases in the US. The company targets high-end smartphone owners with cases featuring waterproof, shockproof and other functions. Most of these features enable the devices to withstand extreme conditions.

But not everyone needs to make phone calls standing in a sandstorm or playing Candy Crush while parachuting. OtterBox had to expand its target customer base to remain profitable.

It has introduced a range of products that can help the smartphone weather everyday situations such as falling into water, dropping on the concrete floor etc. With fashionable designs on case surfaces, OtterBox has also managed to win hearts and customers.

The "clumsy" smartphone users are what OtterBox is really eyeing, said Nisbet.

"They know the value of technology in their hands and they want to protect it. That's the customers we want," he said. Most of the smartphone brands that the company serves include Apple Inc, Samsung Electronics Co Ltd, BlackBerry and LG Electronics.

Perhaps, what really looks promising for OtterBox is the huge craze among Chinese customers for smartphones. After surpassing the US as the leading consumer of mobile phones in 2012, every step China has taken has rewritten the history of smartphones.

By the second quarter of this year, the total number of smartphones in use in China had reached 630 million, higher than the rest of the top five markets combined, said Groupe Speciale Mobile Association, an industrial group of global mobile operators and telecom companies.

Juxtaposed against the 1.3 billion Chinese population, the adoption rate for smartphones is set to climb further in the years to come, the association said.