The Glory brand was born
In the era of smartphones, Huawei has gained insight into the desire of young consumers for high performance, stylish design, and affordable prices. In order to meet this market demand, Huawei launched its sub-brand Honor in December 2013. Honor's positioning is clear, that is, to provide cost-effective smartphone products for young people and Internet users.
In terms of product design, Honor mobile phones pay attention to fashion sense and youthful elements, and strive to attract the aesthetic orientation of young people. Honor has adopted a different marketing strategy and sales channels than the Huazhu brand. It is mainly sold through online e-commerce platforms, keeping up with the online shopping habits of young people and expanding its influence with the help of Internet marketing. This strategy enables Honor to accurately reach its target user group and effectively control the cost of sales.
In terms of pricing, the price of Honor phones is generally more affordable than that of Huawei phones. They offer mid-to-high-end performance configurations, but they tend to cost about half the price of phones in their class. This pricing strategy won the favor of a large number of young users, and enabled Honor to achieve good market performance in the early stage of its release.
Huawei supports and develops
As a sub-brand of Huawei, Honor has received strong support and resource investment from Huawei in technology, R&D, and supply chain since its birth. This ensures excellent hardware performance and reliable product quality for Honor phones, making them stand out from the rest of their price range.
With the gradual maturity of the Honor brand, Huawei's support for it is also increasing. In 2018, Huawei's founder, Ren Zhengfei, revealed in an internal document that the company had allocated a lot of resources to the Honor brand to support its global development. This decision indicates that Huawei attaches great importance to the Honor brand and sees it as an important growth point for the company's future development.
With Huawei's support, the Honor brand's product line and market territory have been expanding year by year. It has not only made great strides in the domestic market, but has also begun to enter overseas markets in a big way. With its excellent cost performance, Honor phones have been widely recognized and welcomed in emerging markets such as Southeast Asia, Africa, and Europe.
Honor is also constantly strengthening its brand influence and marketing capabilities. Through a variety of marketing campaigns and social media operations, it has established good interaction and stickiness with the younger user group. The youthful and fashionable image of HONOR mobile phones is deeply rooted in the hearts of the people, and it has become an important spokesperson for Huawei Group in the young market.
Background and impact of the spin-off
Although the Honor brand has made great strides with Huawei's support, Huawei has been subjected to severe sanctions from the U.S. government since 2019. As a result of being included in the Entity List, Huawei has been severely affected in key technology areas such as chips and operating systems.
Faced with a difficult situation, Huawei had to make difficult choices. On November 17, 2020, Huawei announced the sale of its Honor mobile phone business, which will be taken over by Shenzhen Smart City Technology Development Group and more than 30 supply chain partners. This decision was seen by the outside world as Huawei's helpless move to "survive with a broken arm".
People believe that the main reason for the sale of Honor's business is to allow it to freely access key supply chain resources such as chips and operating systems to get rid of the impact of US sanctions. As an independent company, New Glory will have greater autonomy and flexibility in development.
For Huawei, after divesting the Honor business, it will be able to concentrate its limited resources on the high-end market, following the development of flagship phones and other high-tech product lines. This division of labor is conducive to the two sides to give full play to their advantages in their respective fields.
Since the spin-off, Honor and Huawei have taken different development paths. The new Honor company quickly restored support for Google's mobile services and re-established partnerships with major chip suppliers to reinvigorate its product line. Huawei, on the other hand, has shifted its focus to its self-developed HarmonyOS operating system and its own mobile phone chips, striving to get rid of its dependence on American technology.
Although the spin-off of Honor and Huawei has raised questions from the outside world, it has proved to be a win-win choice. It allows both Honor and Huawei to focus on what they do best and encounter new opportunities on new tracks.