The Key "Weight" To Compete For High-End Mobile Phone Market

From proposing to expand the high-end market to fully deploy high-end products, mobile phone manufacturers have experienced about two years of exploration. Until 2021, especially in the domestic high-end market, the competition is increasingly fierce.

In fact, in addition to products, channels and marketing are equally important for the mobile phone industry. The dazzling marketing campaign is almost full of the time after the whole year, and for the channel level related to the lifeline of sales, the reform has been deployed as early as last year.

Different from the mode of wide distribution network around the peak of 2016, "narrow channel" has become the strategic direction of many mobile phone manufacturers. In this fierce red sea battlefield in China, the speed of channel adjustment and implementation will be a key "weight" to determine the winner of high-end battlefield besides products.

High end market hot

The rise of high-end mobile phone consumption has basically become the industry consensus.

Of course, this is caused by a number of factors. On the one hand, mobile phone consumption has a trend of upgrading; on the other hand, with the large-scale market of 5g mobile phones, its price has also risen under the influence of increasing components.

After the recent one plus nine series of press conferences, Liu zuohu, CEO of Yijia, explained in an interview with the 21st century economic news reporter that the performance of components is improving every year, and its price has been adjusted. It is different from the previous industry understanding of "performance increases but price does not rise", but it is understandable. "For example, the Qualcomm snapdragon 888 chip is more expensive than last year's snapdragon 865 chip, and the cost of Sony's imx689 sensor added with 9 is not low."

In addition, there is also a change in external factors. Affected by international factors, some domestic manufacturers give up part of the high-end market share in a short period of time, resulting in a new competitive space. These together constitute the background of competitive capacity in the high-end market.

On a weekday at the end of March, a reporter from 21st century economic report visited the electronic street stores in Tianhe area of Guangzhou, and found that the customer unit price of offline mobile phone stores has risen from 2000 yuan before to more than 3000 yuan today.

A middle-level member of DiXinTong told the reporter that before 2020, the market share of high-end mobile phones with price above 4000 yuan was hovering at more than 10%. In the near future, the data has reached 20%. It shows that the new crown pneumonia epidemic only affects the consumption performance of low-end mobile phones, and there is still an increase in the high-end market.

"We believe that there is no market for mobile phones below 1000 yuan, but the replacement cycle of this part of the stock market may be prolonged, and it will not change as frequently as some price segments do." He added that the average market price has been changing. At present, the average retail price of the whole market can be about 3600-3700 yuan.

A shopkeeper in Tianhe Broadway also told the 21st century economic report that during the peak period of the mobile phone market around 2017, the average price of the market was about 2000 + yuan, but at present the customer price has exceeded 3000 yuan. The most popular model in the store is the flagship mobile phone with mid price.

Sui qian, senior director of wireless smart phone strategy at strategy analytics, a third-party consulting firm, told reporters that the global wholesale price of smart phones is expected to rise by 8% this year to nearly $300, and mainstream manufacturers will have a trend of rising prices.

From a commercial point of view, the higher average price of mobile phones is actually more conducive to the healthy development of the whole industry. Hardware industry chain manufacturers are mostly low profit businesses in China. The promotion of sales volume in higher price segments based on performance and products will also improve the profitability of manufacturers, and then feed back higher quality R & D. As for the channel, these hot mid and high-end products can bring them relatively considerable profit performance and support the improvement of the closed-loop of the most terminal industry.

"The thousand yuan machine is actually used to run volume, but retailers also have various costs, such as rent, personnel input and other additional costs and amortization. The average gross profit margin of this industry will perform better with the increase of price, so we are also looking forward to good high-end machine products. " A channel source confessed to the reporter that this is also the reason why some brands had better sales on high-end machine products before, because it can bring relatively rich profits to the channel, and channel providers are willing to actively participate in this closed-loop role.

Just looking at the global high-end mobile phone market, apple, Samsung and Huawei are still in a stable position. Channel operators are also looking forward to more brands to support the changing market pattern. However, the test behind this is not only the product and R & D ability of mobile phone brands, but also the adjustment and control of channel by terminal manufacturers and the matching of appropriate marketing.

Channel restructuring strategy

The sense of crisis began to show signs when the wave of aircraft changes in 2018 came to an end. When the high growth period of the domestic mobile phone market ends, the industry enters a stable development period, and the replacement cycle is generally prolonged, and the whole industrial chain is under pressure.

At the market level, the manufacturers represented by oppo and vivo widely deployed the sinking channel market, occupying the first position of channel strategy in the market growth period, and even led other brands to follow suit.

"Before 2017, during the period of rapid development of the company, in fact, we did not have much concept of channel trading. The products are in the warehouse. If there is a demand from the channel, we will take the goods. Around June 2020, we feel that the industry is already struggling, and the change will begin. " An oppo regional distributor told 21st century economic news that the company had predicted that the market might experience a difficult period in the future, so it began to raise funds to prepare for it. By the middle of the year, the global policy situation suddenly changed dramatically, and the company began to implement channel change.

This is also a sign of the industry's maturity. In the period of flow dividend, the enterprise can complete the preliminary accumulation with the continuous sinking and fast enclosure. But when the industry goes to the development bottleneck period, it means that it needs to go through a thorough reform, including the whole process from product research and development to channel sales.

"We review and find that in the era of 4G replacement, the industry generally adopts the distribution mode. But after going through the trough in 2019, we all realize that the entire trading mode needs to be coordinated from the perspective of customers' thinking and products, so as to conduct a complete trading of all channels. " This will include the classification of goods, the classification of distributors and the management of market order.

After the hierarchical management of channel operators is adopted, the channels of different levels of ability can be matched with different levels of sources of goods and resources support, which can also make the powerful channel operators grow stronger and stronger, forming a similar Matthew effect. "After the marketing of channel customers in different levels, with the emergence of more high-end products, the brand potential can follow up, which can bring relatively considerable gross profit and form a benign development trend." The dealer continued.

In this process, oppo is also implementing a matching it system support to open up the whole financial, goods and logistics systems of manufacturers and distributors. Therefore, the system can determine the next day's goods inventory matching according to the sales performance of the day, and complete the digital management.

"Oppo system started to adopt this trading mode from reno5 series. In the past six months, we found that the sales volume increased by more than 60% year-on-year." This is what the dealer said.

Of course, the other side of Matthew effect is that the relatively weak scale of channel merchants may be limited in taking goods. According to the introduction, this will promote this kind of channel business's determination to grow independently, and regulate their behavior of changing sales rules at will.

"In the context of widespread core shortage, in the future, the production capacity and raw material procurement of new machines need to be planned in advance, which requires the omni channel management of the sales end to make it clear how much the future customers' carrying capacity is." According to the analysis of the above dealers, in essence, this also means that the channel strategy of the terminal manufacturers has changed from the game under the distribution idea to the current customer management and unified trading, which also makes the stickiness and coordination between the manufacturers and the channel providers higher.

For example, this will allow mobile phone manufacturers to better match exports with high-end mobile phone sales capacity, rather than relegate high-end products to retail stores without any difference.

The battle of channel management

This also means that the current mobile phone market is from extensive development to fine management. The battle to seize the window period of high-end market is one of the important assessment points, because high-end mobile phone sales mostly come from offline.

For the high-end impact of the same ambition, the previous heavy online channel, now also in the narrow channel mode, to speed up the offline deployment.

Liu zuohu explained in an interview that there are two reasons for making efforts offline. One is that high-end products need to be in real contact with customers offline. Second, most of the current high-end products of brands must be sold offline more than online. One plus has adopted a narrow channel model in India before, and its offline sales in India account for nearly half, and achieved good results. Therefore, it has also learned from this strategy in China.

"We adopt the" exclusive 5S "brand agency mode, and select some customers in various regions to act as exclusive agents. This also makes the resources more centralized, and the dealers can have high efficiency and win-win results." He explained that exclusive agency will give dealers more confidence in common development with the brand, while different offline channels have different characteristics. Yijia will not build its own flagship stores in an all-round way. According to the mode of exclusive cooperation, the channel customer system can be better improved. "Our offline channels have been basically spread across the country."

Under the unified management of channel and marketing initiated by terminal manufacturers, the feedback of high-end market has become positive. According to the personnel of the aforementioned channels and stores, previously, oppo's high-end find series had a small number of pre-sale units in history, but now a week after the product was released, it has received dozens or even nearly 100 sets of pre-sale demands. The sales volume on the first sale day of find X3 also exceeded that of reno4.

In fact, these are not individual cases, and other head manufacturers have also begun corresponding channel management adjustments.

"Any business model is shaped by the market environment." The aforementioned dealers told the 21st century economic reporter that when a model brings significant results, more manufacturers will participate. Especially at present, the battle of mobile phone manufacturers has entered a critical period, and the demand for supply chain management in the future is becoming more and more severe, which means that the channel is bound to move towards a profound reform.

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