The smartphone industry is always fiercely competitive and full of vitality.
The past 2021 is undoubtedly a powerful interpretation of the state of the industry. On the one hand, the market size has regained growth, and the IDC report shows that the Chinese smartphone market shipped about 329 million units in 2021, a slight increase of 1.1% year-on-year, reversing the decline since 2017. On the other hand, the industry pattern ushered in a reshaping, Huawei contracted, leaving a vacancy "nourishing" other brands, Apple, vivo and other high-end market share, the overall market development trend to change the middle and upward.
In the midst of industry turmoil, vivo, with a market share of 22%, became the annual "new king" of China's smartphone market for the first time.
In the past so many years, vivo often gives people a feeling of not showing the mountains and not showing water, neither participating in the price war, nor getting involved in the "war of words", always burying his head in a hurry. But this time, after ascending to the throne, Vivo wanted to keep a low profile, and the strength was not allowed.
"2021 is a very turning year for vivo, we have gained some achievements, but also seen many problems, precipitated more thinking. If we look back at 2021 in another ten or twenty years, this may be the first year of our qualitative change. Shen Wei, founder, president and CEO of Vivo, mentioned in his New Year speech before the festival.
Where does vivo's "qualitative change" occur? And how did it happen?
01
This is the "base color"
Nothing has ever come out of nowhere in this world, and all "qualitative changes" must have undergone a long period of "quantitative change" before they occur.
Vivo is no exception.
For the rise of vivo, the outside world likes to attribute factors such as channels, brands and mobile phone market patterns, but this is obviously not the whole answer - because the competition in the mobile phone industry is intensifying, partial science students are not eligible to participate, and the lucky ones who increase their market share according to changes in the market pattern are also not eligible.
Vivo listens to the thunder in the silent place, first of all from its background color - duty.
For duty, in vivo's values, it is not only "insist on doing the right thing and doing things right", but also requires burying one's head in the cause. At the vivo developer conference in December last year, Shi Yujian, senior vice president of vivo, explained from another perspective, "The product is the cause, and the brand is the effect." ”
As a technology company, the most important reason, of course, is technological innovation. After all, without strong technical reserves and scientific and technological innovation, there is no foundation and ability to support product innovation, and naturally it will lose market competitiveness. Especially in the ever-changing and ever-changing smartphone industry, a moment's slack and hesitation about cutting-edge technology may cause a gap that is difficult to recover.
Therefore, over the past many years, vivo has been immersed in the cause of the user's invisible places in the design, image, system, performance and many other tracks for ten years.
For example, in the image track, mobile phone images have long ceased to stay on the function of taking photos, but have become a new way of interaction between people and become a link of deep human emotions. Based on this insight, vivo is committed to developing different shooting modes on the one hand to cover the daily shooting scenes of mobile phones, so that users can record beautiful pictures with mobile phones at any time; on the other hand, it strives to be clearer, more aesthetic, artistic, three-dimensional and professional shooting effects.
Since 2017, vivo has established 7 image R&D centers in Shenzhen, China, Taipei, Tokyo, Japan and other places around the world, forming a R&D team of 1,000 people. From 2020 onwards, it will also cooperate with ZEISS strategically to form a business synergy and complementarity, industrial chain integration, and integrate professional photography with mobile phone photography technology to promote the improvement of mobile phone image performance capabilities.
Kung Fu pays off. After years of continuous investment and research and development, vivo has made many major breakthroughs in the fields of selfies, portraits, night scenes, anti-shake, zoom, backlighting and other shooting fields.
For example, in the performance track, Vivo and the China Academy of Information and Communications Technology jointly built a simulation network laboratory to jointly study and improve the mobile phone communication experience; At the same time, three major engines of high real-time computing, intelligent scheduling computing, and high-speed load chasing are designed to improve the computing performance of mobile phones. In short, based on the capabilities of computing, storage, display, etc., vivo has truly achieved the smoothness of the whole scene under the daily high-frequency use scenarios such as application startup, content loading, visual fluency, and touch perception.
Along with the accumulation and breakthrough of technology research and development, it is the love of consumers and the recognition of the industry. Taking the X70 as an example, in addition to the V1, vivo's first self-developed professional imaging chip, this mobile phone also introduces the ZEISS optical concept and standard into the mobile imaging system, so it has professional imaging capabilities. With the assistance of this phone, vivo successfully ranked among the top three in the market share of more than 4,000+ high-end mobile phones in the third quarter of 2021. According to Counterpoint data, in the whole of 2021, Vivo's market share in the $500 to $600 price segment doubled, jumping from 10% to 20%.
Also this year, Vivo was also issued the "All-Scenario Lasting and Smooth Experience Thiel Five-Star Certificate" for the first time, which was recognized by the industry's authoritative laboratories.
In addition, in the past few years, advanced new technology laboratories and research institutes such as vivo user innovation laboratory, chip laboratory, analog network laboratory, and thousand mirror security laboratory have been established one after another. After these seeds full of scientific and technological power have been planted one by one, they are now gradually taking root, bringing consumers a beautiful digital life service. As Shen Wei said, "Technology does not exist for the sake of showing technology, and the end of science and technology is to make people feel happy and reach beauty." ”
02
Long-termism is the cornerstone
If you want to ask what hot words have been said in the investment circle and the business community in recent years, then long-termism and "friends of time" must be on the list - after all, there is no company that does not think that they uphold long-termism, and no investor does not feel that they are "friends of time". But it is not easy to implement long-term doctrine.
True long-termism requires the insistence of distinguishing between right and wrong without interest orientation, the attitude of pursuing the long term in everything and not just fighting for the day, the awakening that adheres to independent and deep thinking without blindly following the current, and the concentration that must be focused at all times because of self-ability.
In Vivo's view, long-termism is "standing in the day after tomorrow and looking at tomorrow." ”
Since 2019, vivo has identified four "long tracks" of design, imagery, system and performance, and has recruited cutting-edge talents around the world for long-term and continuous research and development investment. In 2021, vivo Central Research Institute was set up to pre-research the cutting-edge technology of mobile phones, pointing out the direction for product and technology planning for more than 3 years.
In terms of technology research and development, vivo has built an "iron triangle" research and development system from product planning, technical planning to technical pre-research. Among them, the product planning is to think clearly about what vivo wants, and the technical planning is to gain insight into the needs of users and how vivo can meet the implementation. When product and technology are combined, Vivo will set up a series of future technology lists for up to 36 months.
Based on such a concept and methodology, this iron triangle research and development system is like a technology beacon, which not only illuminates the present, but also guides the future, not only to meet the daily technology research and development needs of vivo, but also to lead the technical direction of vivo and even the entire mobile phone industry.
Thanks to the long-term ism and forward-looking of technology research and development, in 2021, after more than 300 people in-depth algorithms, IP conversion and chip architecture design, after a full 2 years of research and development, Vivo launched the first self-developed image processor chip V1.
In an interview with the media, Hu Baishan, executive vice president and chief operating officer of Vivo, once said bluntly, "These things need to be continuously accumulated, not to find a bunch of people to invest a bunch of money today and immediately produce results." At present, the reason why we can produce V1 chips is strongly related to our projection image algorithm 5 or 6 years ago. ”
03
Ultimate user orientation
According to Drucker, a management scholar, there is only one purpose of the enterprise, that is, to create customers, or to meet some social needs. Without a deep insight into the needs of users, innovation will become a castle in the air, and long-termism will become a rootless wood, so great companies will always be user-oriented.
But user-oriented, easier said than done. As Henry Ford once said, "If you ask a customer what transportation they want, they might answer, 'A horse that runs faster.'" And as Jobs put it, "People don't know exactly what they need until you put the product in front of them." ”
In 2021, Vivo will include "design-driven" as its core values. Design-driven is not simply designer-driven or vassal-driven, but ultimately user-oriented. The ultimate user orientation is not to seek answers from users, but to go deep into user scenarios and predict the needs of users. Only by walking into the user scene and thinking and understanding can we truly meet the pain points of users. Any user-oriented that deviates from the actual scene is a rogue. In Vivo's own words, it is "wearing the shoes of the user and running in the enterprise".
Under the premise of "design driven", Vivo will often ask itself: What can Vivo change? Can this change bring a whole new meaning to users? Is this change achieved in a simple, perfect, and elegant way?
For example, for mobile phone manufacturers, night scene video shooting is a scene with great technical challenges. If you want your phone to take a good video at night, either increase the amount of light entering or increase the exposure time. But these two conventional practices have obvious shortcomings. The former causes a lot of noise in the video, while the latter affects the smoothness of the video. With the help of the high-performance, low-power V1 chip, the X70 Pro series not only makes night video shooting clear enough, but also smooth enough, so it is favored by consumers.
There are many similar cases. For example, in terms of improving the technical capabilities of the system core, the technical point most related to the consumer pain point is storage. For the storage problem, vivo adopts a leading algorithm, through various technical processing, the part of the ROM storage is scheduled to RAM use, thereby greatly optimizing the storage performance. In the past three years, vivo has been able to increase its storage optimization rate by about 40% per year. Vivo's 8GB running memory mobile phone can accept 14 applications running in the background at the same time in 2019, increasing to 20 in 2020, and reaching 28 in 2021 - this is equivalent to consumers using the cost of buying 8GB memory phones to experience a larger 12GB of memory effect. "We want to make the same configuration of the product, to achieve higher performance, better experience." In an interview with the media, Vivo vice president and president of Vivo AI Global Research Institute said around.
It is also based on this extreme user orientation of going deep into the real demand scenario, vivo launched a new generation of mobile operating system OriginOS Ocean in 2021, which has become the best summary of the user experience with simplicity, reliability and excitement. The "simplicity" in originOS Ocean's design language is not a crude reduction of visual elements, its essence is to control desire while using design to bring clearer primary and secondary, more accurate focus, and more efficient communication for content. For example, in terms of battery life, OriginOS Ocean increases the battery life by 8% per year through the AI perception engine and fine-grained endurance control.
04
From Flywheel 1.0 to Flywheel 2.0
In The Book from Good to Excellent, author Jim Collins proposes the famous "The Flywheel Effect," which refers to the organic interconnection and promotion of the various business modules of a business organization, like cogs that bite into each other. From stationary to spinning, the gear set may take a lot of effort up front, but the effort of each lap will not be in vain. When a gear is rotated, the entire gear set will rotate rapidly, and eventually the flywheel will turn faster and faster.
In 2001, Amazon founder and CEO Jeff Bezos painted Amazon's growth flywheel as he and his assistant team painted the company's growth wheel. In the 20 years since, the flywheel effect has become widespread and has become a mainstream model for media and investors to study large enterprises.
As a company that always pursues the joy of the crowd rather than the pleasure of the individual, vivo also has its own unique flywheel - not only the bite between its own business, but also the pursuit of breathing and sharing with stakeholders.
In the past 26 years of Flywheel 1.0 stage, Vivo has used its duty and patience to aggregate outstanding talents and partners in the industry, work together to provide high-quality products and services, so that consumers can obtain real perceived value, and realize the chemical reaction of consumers, employees, business partners, and shareholders, thus creating a continuous positive drive of the industrial closed loop.
From the flywheel 2.0 stage opened in 2022, vivo will aim to transform from "making high-quality products" to "creating great products through design-driven and technological innovation", so that consumers can change from "choice" to "love", from "satisfaction" to "active recommendation", and then use great products to establish a world-class brand that consumers love.
As Shen Wei said, "There is only one real breakthrough point for Flywheel 2.0, that is, to make great products." The premise of making a great product is to be driven by design in terms of ideas, concepts, and values. Second, we must have strong scientific and technological reserves and technological innovation. ”
epilogue
At The 2004 Cico Financial Company annual meeting, Buffett's partner Charlie Munger said, "Even if this (honest) way of doing business doesn't bring us many economic benefits, we will do it." More often, though, we make more money because we stick to our morals. In our opinion, Benjamin Franklin was right. He didn't say that honesty is the best moral character, he said honesty is the best strategy. ”
In the same way, duty and long-termism are also the best strategies. From the story of vivo for so many years, user-oriented, adhere to scientific and technological innovation, create the ultimate product for users, and become the first year of qualitative change in 2021 and reach the top of the industry, we can clearly see that the world is indeed rewarding those who do their duty, do not forget their original intentions, and adhere to long-termism.
*The above does not constitute investment advice and does not represent the views of Wall Street Insights, please make independent judgment and decision-making.