Southern Weekend contributed | Tian Huainan
"It is very naïve and naïve to simply say that Huawei's empty market should naturally be divided by several domestic brands." At the beginning of December 2021, the words said by Zhao Ming, CEO of Honor, were widely circulated in the mobile phone industry and were hotly discussed by practitioners.
In a simple sentence, it not only reflects the fierce competition situation in the mobile phone market in the past year, but also Zhao Ming's perception after the company's rebirth.
In 2021, a smartphone brand called "Glory" rose to a low ebb, drawing a smile curve in its share of sales in the Chinese market.
Honor was born on December 16, 2013, was once an independent Internet brand operated by Huawei terminals, with annual shipments of more than 70 million units at its peak. At the end of 2020, under the circumstance that "industrial technology elements are not sustainablely obtained", Huawei sold its entirety to Shenzhen Zhixin New Information Technology Co., Ltd., whose shareholders include more than 30 honor agents and distributors.
In Huawei's public statement on the acquisition, it was called "a self-help act initiated by the glory-related industry chain." Bid farewell to Huawei, the glory after independence, reorganize the supply chain, start a business for the second time, and choose a "correct and difficult" path.
▲With the advent of the wave of mobile phone intelligence, the annual shipments of mobile phone manufacturing enterprises around the world continue to grow, and mobile phone manufacturers have upgraded their technology and optimized the mass production process.
Win-win situation between brand and channel
With the advent of the information society, smartphones have become the most popular and updated consumer electronics.
According to data from the China Academy of Information and Communications Technology, from January to November 2021, 358 new smartphone models were listed in the Chinese market, an increase of 11.9% year-on-year; smartphone shipments were 310 million units, an increase of 14.7% year-on-year. In other words, on average, at least 1 new machine is launched every day in the Chinese market, and an average of 1 million units are sold every day.
The controversy has always been fierce. What's more, smart phone consumption has always been "like the new and tired of the old", and the disconnection of a brand's new machine means that the market share will be surrendered.
From the end of 2020 to june 2021 before the Launch of the Honor 50 Series, Honor did not release blockbuster products. At its peak in 2019, it had accounted for 16.7% of the domestic smartphone market share, and this proportion fell to 3% in the first quarter of 2021.
However, Honor's partners did not give up or slacken off, and still built more than 2,500 Honor experience stores and special areas during their out-of-stock phase. During the "May Day" period in 2021, Glory even launched the "thousand stores open together", and 1,000 new stores were opened offline across the country.
This is largely due to the dealers of Honor.
The development of Glory in 2021 also proves that this long-term win-win relationship between the brand side and the channel side is the strongest backing during the restructuring of the glory industry chain and the vacuum of new products, and it is also an important support for the rapid opening of the situation and the rapid rise of market share after the new machine is listed.
Zhao Ming told Southern Weekend that Glory "adheres to open innovation, win-win cooperation, has friends and a future, and constantly contributes to the system, rather than just taking from it, so as to achieve the rapid development of enterprises and industries." ”
It is based on this concept of common development that Honor resumed cooperation with major partners in the global supply chain in 66 days after independence; 134 days, the integration was fully completed, starting a comprehensive sprint of the new strategy; 185 days, announcing the upcoming world premiere of products equipped with Qualcomm Snapdragon 778G mobile platform; 211 days, Honor 50 series was released, injecting living water into dry channels.
According to data from Counterpoint, a third-party research institute, after the release of the Honor 50 series in June 2021, the market share of Honor mobile phones in China increased from 8% in the second quarter of 2021 to 15% in the third quarter of 2021, ranking among the top three.
In October 2021, Honor released the Honor 50 series overseas, officially setting sail and restarting the overseas market.
On December 16, 2021, at the 8th anniversary celebration of Glory, CEO Zhao Ming specially thanked friends - users, employees, suppliers, channel providers, service providers, no matter the good times and adversities, always stand with Glory, the support of many friends, so that Glory can face everything with a smile.
After the lack of cores in 2020-2021, the shortage of new products, the restructuring of the industrial chain, and the expansion of channels, this statement is by no means polite, and it is indeed from the heart.
Let go of the sharpness of the fight
Many people can't imagine that a smartphone less than the size of a palm is made up of about 1500 components. Behind this is a supply chain system that is spread all over the world, highly specialized, and each link is closely interlocked.
On average, smartphone brands iterate a new product every year, and the life cycle of the product from design, development and production to marketing takes about one year.
This rhythm tests the ability of industry competitors to rapidly industrialize and the ability of supply chain systems to respond and cooperate quickly. Every minute and second is precious, and 6.84 million seconds (75 days) is an unimaginable number.
Honor only got the Snapdragon 778G chip data 45 days later than the industry, but released the Honor 50 series equipped with the chip 30 days earlier than the industry. After recovering the time, Honor released its first blockbuster product after independence. The Honor 50 series has become a major contributor to the promotion of the Glory smile curve, and it is also the first model equipped with Qualcomm chips after its independence.
On June 25, 2021, the official expenditure of the Honor 50 series, the sales of 1 minute exceeded the 500 million mark, and won the double champion of single-day sales and sales of Tmall, JD.com and Suning on the same day. Zhao Ming posted late at night, "Thanks to the recognition of consumers, honor 50 first sales online and offline have created new records."
In the first three days of listing, the Honor 50 series created a sales record of 2,000 yuan to 4,000 yuan, surpassing the first sales of a single model of all brands in the past, and then in this price range the market continued to be the first for many months, becoming the main product of Honor in the second half of 2021.
Zhao Ming, who joined Huawei after graduation, admitted to Southern Weekend that bidding farewell to Huawei, the most important thing taken away by glory is corporate culture and core values, which is also the root of an enterprise that can develop for a long time and win the respect of the industry and consumers. Glory's core values of "consumer-centric" take the ultimate productism and create value for consumers as the goal.
In the past, foreign brands entered China to seize the market share of many industries and occupied a lot of the "high-end market segment", while independent brands were still in the growth stage. However, in a very short period of time, Chinese brands have cultivated their own advantages, and constantly added bonuses to make Chinese brands go to high-end.
Chinese brand smartphones started with thousands of yuan machines in the past, and have been challenging the high-end product market for many years, and are still working hard today. From the beginning of 2021 to the end of the year, the hustle and bustle of the high-end market has never stopped, and various mobile phone manufacturers have launched products at a price range of 4,000 yuan and higher.
The glory after independence, standing on a new starting point, also has the sharpness to let go.
In August 2021, Honor released magic 3, a more high-end product with prices ranging from 4599-7999 yuan. The Magic series was first launched in 2016, focusing on technology and intelligence, followed by Magic and Magic2 in 2016 and 2018.
According to Honor's data, the Magic3 series entered the top three of the high-end price products of 4,000 yuan-8,000 yuan in the Chinese market a month after its release.
In the context of the industry in which most of the manufacturing links in the consumer electronics industry are completed by foundry enterprises, Honor decided to build its own factory in 2021.
On November 4, 2021, Glory's first self-built factory, Glory Intelligent Manufacturing Industrial Park, was opened to the public. 75% of the process of the production line is completed by automated equipment, of which more than 40% of the equipment comes from independent research and development, and every 28.5 seconds of beat can produce a mobile phone.
▲In the Glory Intelligent Manufacturing Industrial Park, workers are manually testing mobile phone products
In Zhao Ming's view, Glory will position itself as a product company, quality is the lifeline of the enterprise, there is no glory of the future without quality, as an important part of achieving high quality, Glory Intelligent Manufacturing Industrial Park will be R & D, trial production, mass production organic combination, and with the help of intelligence and automation to achieve efficient whole-process quality control.
At the same time, Honor has also continued to deepen the quality forward, in the form of enabling synergy, the quality standards and manufacturing processes of Honor have been integrated into the upstream manufacturing processes of partners, EMS (electronic foundries) and even suppliers.
Every year, Honor has nearly 300 R&D personnel stationed at the partner site to improve the manufacturing process and achieve high-quality, high-efficiency and sustainable collaborative development of full-link manufacturing.
Zhao Ming told Southern Weekend that the biggest challenge in the global smartphone industry in the process of coping with the challenge of global lack of cores and impacting the high-end market is to be able to remove impetuosity and create a boutique product that can truly match the needs of users and improve the user experience.
With product research and development and industrial chain cooperation on the track, Honor's new product releases have followed, and its product portfolio has become more and more abundant, and the space for maneuvering has been greater.
In December 2021, the Honor 60 was released, and two new models were pushed in half a year, and the pace and speed were greatly accelerated, which also attracted the attention of peers. A mobile phone brander bluntly said to Southern Weekend, "Too fast, the pressure is high." ”
Choose the right but tough path
In October 2021, Honor released the Honor 50 series overseas and restarted overseas markets. For Glory and Zhao Ming himself, who has been in Huawei's European market for a long time, the overseas market is not unfamiliar.
According to the latest data from the National Development and Reform Commission, from January to November 2021, China's exports of high-tech products were 5,661.71 billion yuan, an increase of 17.8% year-on-year; imports were 4,890.31 billion yuan, an increase of 15.1% year-on-year. This competitiveness is particularly evident in the mobile phone industry. According to statistics from research institute Canalys, in the first three quarters of 2021, three of the top five in the global mobile phone market share are Chinese companies.
In 2021, every smartphone manufacturer in the world is under unprecedented pressure. Whether it is the 300 million units in the Chinese market or the market share of 1.4 billion units in the global market, the ranking of each company occasionally fluctuates up and down, and the overall competition is very sticky.
According to the International Data Corporation (IDC), global smartphone shipments have continued to decline since a record peak of 1.47 billion units in 2016. In the past two years, due to the covid-19 epidemic and economic environment, the frequency of people changing machines has declined, and the overall sales scale of global smartphones has not yet returned to the level before the epidemic (2019).
With the continuous improvement of 5G and AI on computing, processing, and connectivity capabilities, the digital process is advancing in an all-round way, the role of smart phones in people's lives is becoming more and more important, their costs and sales prices are also rising, and consumers have also put forward higher requirements for smart terminal enterprises, which are lighter, more convenient, more intelligent, greener, more economical and environmentally friendly, and so on.
The functions of smart phones are becoming more and more powerful, and the scientific and technological content is getting higher and higher, from chips, lenses, screens, batteries, materials, charging, imaging, operating systems, application ecology, etc., all of which are key points of competition, and all of them test the scientific and technological innovation strength of enterprises.
Apple, Huawei, etc. took the lead in self-developed chips for their own use, and Xiaomi, OPPO, etc. also began to get involved. With the expansion of consumer electronics products to the upstream of the industrial chain and even the surrounding terminal fields, these companies want to achieve sustained success and are destined to go farther and farther on the road of hard-core technology, which also tests their courage in research and development investment and their ability to foresee the future development of science and technology.
"In the competition of the mobile phone market, we must tremble and walk on thin ice." Zhao Ming mentioned in an interview with the media, "Glory's goal is to have the ability to innovate on a par with Huawei and Apple. ”
At present, Honor has more than 10,000 employees, more than half of whom are R&D personnel, with 4 R&D bases and more than 100 innovation laboratories in Shenzhen, Beijing, Xi'an and Nanjing.
On December 27, 2021, the lab will add another one. Fudan University and Glory held a strategic cooperation agreement, the two sides will jointly build a multi-field expansion of the industry-university-research cooperation platform, promote talent training, promote the application of basic research to the transformation of engineering technology application achievements of comprehensive cooperation, but also signed a "intelligent terminal software development technology school-enterprise joint laboratory" agreement.
Glory stressed to the outside world that it is necessary to "deal with the uncertainty of the future with the certainty of ability." Many of Honor's R&D personnel come from the original Huawei terminal R&D team, which also helps to maintain its original R&D system and personnel combination structure.
Honor's intelligent terminal development concept and planning also continues the original idea, adheres to and deepens the 1+8+N all-scenario smart life strategy, and through the collaborative AI middle platform for perception, learning, and judgment, lets the service flow between different devices, enhances the content circulation and cross-terminal seamless connection capabilities, and then opens such capabilities to ecological partners, continues to evolve end-to-end with partners, and finally brings users a cross-device, cross-screen, cross-system all-scenario intelligent experience. Create a new world of wisdom for everyone.
On December 16, 2021, Zhao Ming announced that Honor will continue to break through the ceiling in technology and innovation.
This seemingly proud vow still needs time to be fulfilled, but the future can be expected.
The current glory, innovation, quality, service as a strategic control point for the future, to create AI, imaging, communications, performance, design, privacy and security as the core areas of scientific and technological innovation and underlying attacks, challenge the industry's strongest, create world-class products and experiences, in the global market to win the recognition of consumers.
Zhao Ming said, "This is the right and difficult road we have to take. ”