Huawei released quite a good line of smartphones this year. The list includes the Honor portfolio which saw an astounding jump from 1 million units per year to 20 million this year. So how did the Chinese manufacturer manage this success?
According to Reuters, Huawei has been learning from Xiaomi’s online marketing strategy. However, the online-only marketing plan Xiaomi and Huawei have adopted may have affected the smartphone makers all around the globe. Manufacturers of handsets have seen a profit increase of 18% per device as a move to online selling has been adopted. When the companies opted for online selling, they don’t need to engage a carrier or retailer and hence, distribution expenses are diminished. The expenses usually make up 30% of the final retail price of a phone. If the 30% is gone, the overall price falls. Price reduction equals to higher sale demand by consumers who love affordable devices.
Hence, when the Honor additions came out this year, Huawei saw a huge jump in sales because consumers love a price reduction on flagships. Its a better bargain in their minds. According to Honor brand president Jeff Liu said in an interview in Beijing, “E-commerce is massively changing the traditional channels for the smartphone industry, and we needed to go in that direction too.” And it seems it was the smartest move the company made thus far.
With many companies realizing the success and profit online sales is garnering for any tech company especially OEMs, it won’t be long before most if not all, of the corporations jump on this bandwagon. And if they do, 2015 is going to be year filled with tech competition and any consumer loves it when companies try to get their attention with better quality devices but with cheaper price tags!
Source: Android Authority