Two years ago, Xiaomi had stormed on to the smartphone scene, overtaking Samsung as the biggest smartphone vendor in China and becoming one of the top five players in the world.

Fast forward 24 months, and major shifts have taken place. Xiaomi, the world's second-most valuable private tech start-up which made its name by selling online through flash sales and creating social media buzz, is getting attacked by upstarts using traditional bricks and mortar stores to sell smartphones. Meanwhile, Apple, which had been doing steady business in China, is facing intense competition from nimbler players.

Oppo and Vivo – two Chinese handset makers owned by BBK Electronics Corporation – are making a big impact, attracting young buyers wanting low-cost but high-spec smartphones, the audience that Xiaomi once had a hold on.

Xiaomi had a 13.3 percent market share in China in the second quarter of 2014. That now stands at 11.2 percent, according to data from Counterpoint Research. Meanwhile, Oppo's market share grew from 2.7 percent to 18 percent in the same period, while Vivo's increased from 2.2 percent to 14.9 percent.

"We tried the online thing, but it wasn't getting the traction we wanted, so we had to look back at strategy and we took a chance and we invested into point of sales presence. We localized everything and from there it really helped us build a stronger brand presence," Michael Tran, director of global strategy at Oppo, told CNBC in a phone interview last week.

"Consumers want to touch and play with the device, they want to know there will be someone there if there are issues."

Both Oppo and Vivo focus their products around high-performance cameras and audio. Oppo's flagship R9 smartphone is marketed as the "selfie expert" with a 16 megapixel front facing camera, fingerprint sensor, and a design very similar to Apple's iPhone 6. But the handset retails at 2,799 yuan ($420), much more cheaper than the $800-plus price tag for Apple's flagship device.

Tran explains that Oppo has over 320,000 physical points of sale in the markets it operates in which includes China, Australia, India and a number of other South-East Asian countries. Oppo and Vivo have both stepped up their marketing efforts. The brands have partnered with major fashion companies, celebrities and sporting tournaments to help boost their name among millennials.