Huawei's consumer business, BG, has become a thing of the past.
On the evening of April 20, at the launch of Huawei's new products for commercial office use, Yu Chengdong announced that Huawei's "consumer business" has been officially renamed "terminal business", and the terminal business will fully cover both commercial products and consumer products.
This means that on the basis of the consumer business, Huawei has fully entered the commercial field.
Yu Chengdong said that under the "Huawei terminal business" system, consumer products will continue to face mass consumers, that is, To C, while commercial products will focus on serving enterprises and government customers, that is, To B/G, focusing on six major industries such as education, medical care, manufacturing, transportation, finance, and energy.
For Huawei, behind this name change, of course, it is not only a business change, it is also a phoenix nirvana, a tragic and brave self-revolution and survival move belonging to Huawei.
Huawei Terminal's "Zunyi Conference"
On December 3, 2010, Huawei held a "high-level symposium" attended by Huawei executives such as Ren Zhengfei, Guo Ping, and Yu Chengdong, as well as 200 key members of the terminal team. The theme of this conference is: to be domineering in doing things, to be humble in life, to follow the laws of consumer goods, and to dare to pursue the greatest growth and victory.
Through this meeting, Ren Zhengfei repositioned the terminal business, clarified the long-term goal of the terminal company to be the world's first in the field of mobile terminals, clarified that Huawei terminals have become the three core businesses of the company alongside the operator's pipeline business and enterprise network, and at the same time, he also made the following three adjustments to the direction of terminal business:
In terms of products, from low-end mobile phones to high-end mobile phones;
In the market, from unbranded to independent brand;
In terms of user focus, there is a shift from operators to consumers.
From today's point of view, this meeting is undoubtedly a major turning point in Huawei's terminal business, and it is also a historic turning point in its consumer-oriented business - it can be called the "Zunyi Conference" of Huawei terminals.
In fact, before this meeting, Huawei's terminal business had existed for many years.
From a specific point of time, the actual starting point of Huawei's mobile phone business is the establishment of Huawei's mobile phone research and development department in July 2003, and soon after, Huawei terminal company was established. However, Huawei made an incision for mobile phones, at first PHS, and later shifted to do 3G mobile phones - at that time, Huawei's 3G mobile phones were actually customized for operators, because they were worried that their 3G systems could not be sold, and they used mobile phones to support 3G systems.
So, in essence, in the early days, Huawei terminals were a piece of ancillary business.
As Ren Zhengfei said:
We think that the development of terminals in recent years has not been easy. At that time, we did not think of doing terminals, we were forced to get on the horse, because our 3G system could not be sold, there was no supporting mobile phone, we had to buy a terminal, we could not buy it, and we were forced to get on the horse. It should be said that you have gone well and succeeded. Guo Ping invented the resale route, specifically for the large operation of customized low-end mobile phones, at that time I was still skeptical about this route, can it be successful? Crooked, successful.
However, with the surge of smartphones triggered by the iPhone around the world, Ren Zhengfei also realized that smartphones are a once-in-a-lifetime industrial development opportunity, so he decided to strategically adjust the development direction of Huawei's terminal business from operator-oriented to consumer-oriented, using the Huawei terminal "Zunyi Conference" on December 3, 2010.
At this meeting, Ren Zhengfei once again made it clear that the most important point of Hua's core values is that everything is for customers. In this regard, Xu Zhijun also added at the meeting:
Our company everything for the customer, in the past said for the operator, but the terminal company's end customer is for whom, is the final consumer. Terminal companies can't now look at operators as customers, and our real customers are consumers.
In this way, through this meeting, Huawei terminals completed the transformation from operator-oriented to consumer-oriented from the strategic decision-making level - soon, in 2011, Huawei officially established the consumer business BG, which became one of Huawei's three major business segments alongside the carrier network BG and the enterprise business BG, and Yu Chengdong served as the CEO of the consumer business BG.
As a result, Huawei's terminal system has evolved into a To C business segment with consumer-oriented as the core at the organizational structure level.
Former To C "Independent Kingdom"
For companies like Huawei, going from To B to To C is a major challenge.
Quite simply, since its inception, Huawei has been doing the To B business, the core of which is to serve operators and enterprise customers; as far as the mobile phone business is concerned, before the "Zunyi Conference", it does not need to directly face thousands of consumers, nor does it need to spend money to establish brand recognition and maintain channel operation. Of course, it can also "make a fortune in a muffled voice" and keep a low profile.
However, if facing To C, Huawei must learn to face the media – which Ren Zhengfei himself knows very well, he publicly stated:
Only offense can succeed, defense cannot succeed. If there is no cadre who is eager to meet with customers, immediately retire from the administrative position, afraid of contact with the media, you should not be an administrative cadre. It is the nature of Huawei people to aspire to success.
Frankly speaking, Yu Chengdong is a typical Huawei person who is eager to succeed and dares to struggle, but in the first period of leading Huawei's consumer business, he also made a lot of mistakes and paid a lot of tuition fees - fortunately, Huawei has enough family foundation, and Ren Zhengfei has enough support for him to lead Huawei to trial and error, to learn, and to improve in the To C business.
For example, as the absolute core of Huawei's consumer business, the mobile phone business has actually experienced two to three years of struggle before it can gradually stand up, according to Huawei's official statement:
Since 2011, Huawei's consumer business has resolutely abandoned the white-label, low-end customized business model and embarked on the high-end road of Huawei's own brand; in 2012, it realized the three major transformations of brands, products, and channels, and firmly implemented the boutique strategy and launched the D and P series boutique flagship mobile phones; in 2013, it initially built an open market capability in the global market; in 2014, with the rapid development of 4G LTE, with the core patent advantages in the field of 4G LTE, Huawei's consumer business has ushered in an unprecedented historical opportunity, achieving a double harvest of revenue and profit.
It should be noted that the To C nature of Huawei's mobile phone business has been running wild, and the underlying innovation business of Huawei To B is on a par with it; not only that, even under the To C system, Huawei is also innovating at the hiSilicon chip level.
For example, Huawei transferred the mobile phone chip business from the HiSilicon system to the mobile phone company to do, the mobile phone company also gave HiSilicon tens of millions of dollars in the early investment, based on this premise, Huawei mobile phone business in the rapid development of the same time, its mobile phone SoC chip business is also developing rapidly, in 2014 at the brand level became "Kirin", and in the follow-up continuous development to become Apple, Qualcomm, Samsung and other world-class giants of related products side by side with high-tech products.
Therefore, to some extent, the development of Huawei's consumer business is also standing under the support of Huawei's entire technical system, which is also Huawei's advantage over late-end manufacturers such as Xiaomi, OPPO and vivo.
Of course, Huawei's consumer business benefits from the Huawei platform on the one hand, but on the other hand, it has also made great contributions to the development of the entire platform, which can at least be reflected in the revenue level:
In 2011, the revenue of Huawei's consumer business was 44.62 billion yuan, accounting for 21.88% of the total revenue, but Huawei's net profit in that year showed a 52.9% year-on-year decline, obviously due to the loss caused by the mobile phone business - but in 2018, the revenue of Huawei's consumer business reached 348.852 billion yuan, accounting for 48.4% of revenue, and Huawei's net profit in this year increased by 25% year-on-year, of which Huawei's consumer business contributed to it.
It should be noted that in 2018, Huawei also made company-wide structural adjustments, and established the ICT Infrastructure Business Management Committee and the Consumer Business Management Committee, of which the latter directly manages consumer BG, to some extent, this also enhances the meaning of the "independent kingdom" of consumer business under huawei's system.
At this time, Huawei's consumer business can be said to be in the sky.
从 To C 到 To B + To C
In 2019, Huawei's consumer business BG accounted for more than 50% of revenue for the first time. At the same time, the Huawei brand has also been upgraded as never before under the support of Huawei's consumer business.
In fact, with the continuous improvement of Huawei's consumer business in product innovation, ecological construction, retail and service, the recognition and reputation of Huawei brands by global consumers continue to rise – a report from ipsos, a brand research agency, shows that in 2019, Huawei's global brand awareness was 93%, an increase of 4 percentage points over 2018; global consumer brand consideration increased from 49% in 2018 to 58% in 2019.
Of course, the improvement of Huawei's brand status is also indispensable to the sanctions and suppression of Huawei, a Chinese enterprise, under Sino-US relations in 2019.
In fact, this is also the turning point of Huawei's consumer business.
In the context of US sanctions, Huawei's consumer business began the process of strategic development in the domestic market in 2019, of which Huawei's mobile phone business accounted for more than 40% of the domestic market in 2019 Q3, and its annual performance was close to 40%.
It should be noted that at that time, the global layout of Huawei's consumer business has begun to shrink, and the role of the Chinese market is more important.
In 2020, under the background of the outbreak of the new crown epidemic, Huawei once again encountered multiple rounds of sanctions from the United States, kirin processors were unsustainable, mobile phone business was also significantly hindered, in order to survive, Huawei even sold the glory business. It is worth mentioning that despite this, the revenue share of Huawei's consumer business has also increased in 2020, reaching 54.2%.
However, from the moment Huawei sold the Glory business, Huawei's consumer business was destined to be on a path to transformation.
Judging from the situation in 2021, Huawei continues to strive to maintain the market presence of Huawei mobile phones on the one hand, launching P50 series products, on the other hand, it has cooperated with Xiaokang to launch automotive products, and has also opened a car sales business under Huawei's huge channel system. This is actually Huawei using the channel, design and brand capabilities accumulated by the consumer business to advance the long-term development of its automotive business – and of course, this is also to survive.
In fact, in order to survive, Huawei consumer BG under the leadership of Yu Chengdong is not only involved in the automotive field, but also continues to enter various business areas with strong B-end attributes, such as the whole house intelligent solution launched by Huawei in April 2021, which is aimed at the front-loading market, which is a typical To B business scenario.
In the past six months, Huawei has successively launched various ecological products such as desktop computers, e-books, and printers for office and enterprise scenarios, which are created by Yu Chengdong's consumer business BG team, but are oriented to various To B scenarios such as education, medical care, finance, and energy under the conditions of the Chinese market.
So in general, in order to survive, Yu Chengdong and his team "what to make money and what to do", what they have done for more than a year is to reinject the brand potential energy and product technology capabilities accumulated in the past in the process of consumer business BG's development and growth into the To B scenario - don't forget here, the To B scene has always been Huawei's advantage area, and even can be said to be Huawei's fundamental business.
In this way, To C was forced to become To C + To B.
brief summary
Overall, the consumer business BG led by Yu Chengdong was officially renamed as the terminal business BG, which is only the last action of Huawei after the multiple business adjustments under major changes, and its symbolic significance is greater than its substantive significance.
Nevertheless, today's Huawei terminal business BG, compared with the Huawei terminal twelve years ago, has a cloud mud difference. After all, in the time of its existence as the consumer business BG, it has completely experienced the major historical opportunities of the golden decade of the mobile Internet, experienced and participated in, and even promoted Huawei's transformation at multiple levels such as brand, channel, chip, consumer cognition, aesthetic ability, and industry status - it is no exaggeration to describe it as Phoenix Nirvana.
Of course, in terms of making money and profitability, today's Huawei terminal business BG is naturally much stronger than the Huawei terminal of that year.
Looking back at the history of the past ten years, the development of Huawei's consumer business BG and the resulting improvement of Huawei's brand potential are also reminding us at all times:
The development of an enterprise, of course, depends on its own efforts and enterprising, but it is completely unable to leave the general environment of the times in which it is located and the historical opportunities; at the same time, the fate of the individual is of course weak in the face of the enterprise organization, and the development of the enterprise organization is almost completely dependent on the development of the country and sinks and falls.