#55 - Festival: Honor Brands

A major event was being discussed internally at Huawei a month ago.

Under the leadership of Yu Dazui, Huawei's consumer division has completed its transformation. Huawei's latest flagship model, although its Kirin processor chip is slightly lacking compared to top-tier processor chips, has achieved relatively good sales.

While Huawei was focused on developing mobile phones, they were shocked by the achievements of Xiaomi and Redmi. In October of last year, Xiaomi, in collaboration with Q-Zone, released a phone priced at 799 yuan, which refreshed the price baseline for domestic mobile phone brands.

Currently, the cost incurred by domestic mobile phone manufacturers when developing mobile phones is still relatively high. Their mobile phone pricing is at least above the thousand-yuan level.

The market below a thousand yuan is basically divided up by counterfeit phones. Xiaomi's release of a 799-yuan phone was simply aimed at blocking the path of counterfeit manufacturers, leaving them with no way to go.

After this phone was released online, it garnered attention from many users, and its sales reached a terrifying figure. In just three to four months, it achieved sales of over four million units.

Moreover, this Redmi phone employed hunger marketing, and this time, the primary sales channel was entirely online. Being able to sell over four million units in three to four months proves that budget phones indeed have a very large market.

Redmi's achievements have prompted responses from various mobile phone manufacturers, and they have also realized that budget entry-level phones do indeed have a viable direction.

After seeing Redmi's success, Yu Dazui also hurriedly convened a meeting of the company's senior management.

Huawei currently has three mobile phone series in total: the P series, the Mate series, and the Honor series.

The first two series are Huawei's flagship series and the most representative models among Huawei's phones. Currently, the Honor series mainly focuses on the thousand-yuan phone market in cooperation with carriers.

If Xiaomi is allowed to develop so rapidly in the online and budget phone markets, it will definitely become a strong enemy of Huawei phones in the future. As the head of the consumer business department, Yu Dazui has discovered a potential enemy for his company.

Although Xiaomi has only been established for less than a few years, its achievements based on the internet model and ultra-high cost performance have even surpassed many mobile phone manufacturers. It has faintly gained a foothold in the market. If Xiaomi is allowed to continue developing in this way, it will sooner or later limit Huawei's development, so Xiaomi cannot be allowed to continue growing wildly like this.

As the head of the mobile phone consumer business department, Yu Dazui pays close attention to the current mobile phone industry. Xiaomi's annual revenue growth in recent years has been increasing day by day. This kind of wild growth will make Xiaomi reach the top level in the entire mobile phone market.

Furthermore, Yu Dazui has also researched the current sales methods of all mobile phone manufacturers.

Oppo and Vivo control the offline market, expanding their influence while increasing shipments and obtaining corresponding profits.

While Huaxing Technology takes a direct and straightforward approach, using technological strength to crush competitors. At the same time, they also have a very large influence in both online and offline flagship stores.

Xiaomi takes the online internet e-commerce operation route, thereby reducing costs. Yu Dazui admires Xiaomi's marketing to some extent.

High-configuration, cost-effective phones, coupled with marketing methods, Xiaomi has basically mastered the art of internet sales.

After thinking it over, Yu Dazui finally turned his attention to the low-end Honor series.

The Honor series is the series with the largest shipments among Huawei's mobile phone brands, and it is also the most malleable series. Huawei's P series and Mate series have already established the impression of flagship phones in the minds of current consumers.

On the contrary, the Honor series has been cooperating with carriers, and users do not have many labels for it. Such a series can instead become an independent new brand. This new brand can learn from Xiaomi, take the e-commerce channel, and adopt the same sales model as Xiaomi, becoming the company's internet-focused mobile phone brand.

Huawei phones focus on offline and high-end models, while Honor focuses on online internet and cost-effective models. The two brands have two different development paths, and they will also give users two complementary brand associations, thereby truly achieving the suppression of Xiaomi's mobile phone development.

After Yu Dazui had this idea, he launched a fierce discussion among internal personnel, suggesting to learn from the online mobile phone sales models of Huaxing Technology and Xiaomi. Afterwards, Yu Dazui made the final decision:

"Letting the Honor series be independent can not only ensure that the high-end image of Huawei's P series and Mate series is not affected, but also not miss the good opportunity for the arrival of the internet craze. Honor's independence has become an important turning point for Huawei."

Yu Dazui is very optimistic about the prospects of Honor's independence. From the sales of Xiaomi's mobile phones last year, it can be seen that the online market has slowly developed and grown, becoming a new battlefield comparable to the offline market.

If Huawei really does not seize the opportunity, I am afraid that such a huge market is likely to be annexed by Huaxing Technology and Xiaomi. However, this matter still needs Ren, the head of Huawei, to make the final decision.

After receiving the relevant documents for Honor's independence, Mr. Ren did not give a direct reply, but hesitated for a moment before finally making a decision.

After all, if Honor wants to be independent, it must come up with a very sincere work and be recognized by consumers. Although Mr. Ren agreed to the independence of Honor, he also needs to see the achievements after Honor's independence. If the results are not good, I am afraid Honor will return to the Huawei brand.