Dialogue with the President of Motorola: Five years of nirvana, return to the Chinese market

Author|Zhang Rui Editor|Kang Xiao

Produced by|Deep Net Xiaoman Studio

"The Chinese market is strategic for Motorola's growth." Sergio Buniac, president of Motorola, said in a recent interview with Deep Web.

Many domestic users' impression of Motorola mobile phones stops at the era of feature phones, and its Razr V3 launched in 2004 is all the rage, but in the 4G and 5G era, Motorola mobile phones do not exist in the domestic mobile phone market.

According to IDC data, 84% of the market share of the domestic mobile phone market in 2022 will be dominated by the five major mobile phone brands of Apple, OPPO, vivo, honor, and Xiaomi, leaving only 16% for other mobile phone brands, which means that Motorola who wants to return to the domestic market will face a difficult "white blade war".

"China's mobile phone market is highly competitive, consumer demand is clear, and product requirements are high." Buniak said, "The company will build on the Motorola edge 30 and find a place in the high-end mobile phone market through the motorola edge series and the folding mobile phone Razr." ”

Cross the line of life and death

As one of the world's oldest mobile phone brands, Motorola's mobile business has had a bad fortune and has changed hands several times.

In 2012, Motorola Mobility was acquired by Google for $12.5 billion, but this "strong combination" did not last long. Two years later, Google, which was working on Android and was not ready to make mobile phones himself, once again changed hands to Motorola's mobile business; In October 2014, Motorola was acquired by Lenovo for $2.9 billion. Lenovo announced at CES 2015 that Motorola phones will return to the Chinese market.

However, the "Motorola feeling" of users in the era of functional machines has not been transferred to the 4G era. According to IDC data, Motorola's shipments in China in 2015 were only 200,000 units.

Since then, the loss of Lenovo Group's mobile business has lasted for 5 years, which is also the 5 years of changes in the smartphone pattern, the once "China Cool Alliance" has become "Rongmi OV", and Motorola has experienced several setbacks in the Chinese market.

In February 2018, Sergio Banyak, who had spent 20 years with Motorola, was named president of Motorola.

"When I was the head of the mobile business, Lenovo's smartphone business lost money for 5 consecutive years, and it was 'fighting for survival'. I needed to revisit our strategy and reset our business model to achieve profitable growth. Sergio Baniac revealed to Deep Web.

Sergio Baniac said that after he became president of Motorola, he launched four initiatives: first, strategic contraction, focusing on the North American and Latin American markets; The second is to clarify the positioning of different product lines, Moto E series positioning the low-end market, Moto G series positioning the mid-end market, Edge series positioning the high-end market; The third is to focus on innovation, such as the launch of smartphones connected to 5G networks through 5G modules (moto 5G mods), and the launch of the first foldable clamshell smartphone razr; Fourth, adhere to the consumer-centered product concept.

Sergio Baniak's strategic realignment paid off quickly, with Lenovo's 2018/2019 financial report showing that the mobile business achieved its first pre-tax profit since the acquisition of Motorola Mobility in the second half of the 2018/2019 fiscal year.

"Through these years of hard work, our strategy has shifted from 'fight for survival' to 'fight for winning', achieving profitability for 11 consecutive quarters." Sergio Banniac told Deep Web.

Involved in the Red Sea

In the United States and Latin America, Motorola has maintained its top three positions in the market.

According to Counterpoint data, in Q4 2022, Motorola's market share in the US market will be 6%, occupying the top three positions in the US smartphone market. In the Latin American market, Motorola's market share in 2022 is 24%, ranking only behind Samsung (39%).

After gaining a foothold, Motorola has significantly accelerated its layout in the Chinese market.

Although the first generation of the Razr in 2019 was not released in China, the second and third generation Razr were both released in China.

"Innovation has been in Motorola's DNA for more than 90 years. We are confident that we will replicate our success in North America and Latin America in Asia Pacific and China." Sergio Banyac told Deep Web.

However, Motorola's position in the top three in the North American market is related to its cooperation with local operators. Unlike domestic mobile phone sales, which are dominated by e-commerce and channel providers, mobile phone sales in Europe and the United States are dominated by operators, and the retail mobile phone market is not large.

"The reason why Motorola can replace LG as the third largest new brand in North America in 2021 is because it leverages a wide range of carrier businesses, especially with prepaid operators and mid-range operators." Some people in the communications industry analyzed the "Deep Web".

In contrast, in today's Chinese market, e-commerce and channel providers dominate the sales of the mobile phone market, and bundled sales with operators account for only a small part of mobile phone sales. If Motorola wants to return to the domestic market, it must consider the differences between overseas and domestic sales markets.

Regarding the challenge, Sergio Baniac told Deep Web, "In addition to entering the high-end mobile phone market through Edge and razr folding phones, we will also enter the B2B field through ThinkPhone." "ThinkPhone is a flagship phone released by Lenovo at CES 2023 that focuses on business office, strong and fallable, looks like Lenovo ThinkPad laptop, is promoted as the best companion of ThinkPad, and there is no specific time plan for whether it will be released in China.

"We also have extensive support among operators, and Motorola will have strong momentum in the domestic mobile phone market." Sergio Baniac predicted.