My Age of Investment

One thousand two hundred and thirty, sub-brand strategy

"The performance of the mobile phone is similar to our fx2 in all aspects, but it is priced below 4,000 yuan?"

Lin Bing looked at Xia Jingxing in surprise. He couldn't digest the shocking news brought back by his boss for a while.

The other Fuxing Mobile executives in the conference room also looked surprised and thought quickly in their minds.

"I judge that this Meizu m8 mobile phone may have a serious impact on the sales of Fuxing FX2 in the domestic market. Especially those price-sensitive users may abandon us and turn to Meizu."

Xia Jingxing glanced at Zhu Zhaojiang and motioned for him to continue.

"Thirty years after the reform, some people in our country have actually become rich first, and there are still a lot of them, but they only account for a small proportion of the total population.

The price of a high-end smartphone like Fuxing Mobile is worth two or even three months’ salary of an ordinary person.

If a new smartphone appears on the market that can surf the Internet, play games, and experience various mobile Internet technology conveniences, and the price only costs an ordinary person one month's salary, then I believe that the vast majority of Chinese people will choose this phone. .

There is not much performance gap between Meizu m8 and Fuxing fx2, but the price difference is a thousand yuan or more. Ordinary people are not stupid, they know how to make choices. "

Zhu Zhaojiang said, "If we let it go, the sales of Fuxing mobile phones will probably drop sharply, but Meizu m8 will take this opportunity to gain the favor of more consumers and become famous in one fell swoop!"

Xia Jingxing smiled and nodded. It seemed that not only he saw the crux of the problem at a glance, but Zhu Zhaojiang did the same.

There is no such thing as "outside the Fifth Ring Road" and "sinking market", but they exist in fact.

As a high-end smartphone, the proportion of domestic sales of Fuxing Mobile in global sales has dropped from 50% at the earliest to less than 20% today. This is clear evidence.

These days, the Chinese people as a whole are not very wealthy. When it comes to the pursuit of high-end mobile phones, most ordinary people still seem to be relatively restrained and rational. After all, they have to calculate firewood, rice, oil, salt, sauce, vinegar and tea, and it is impossible to spend all their money on buying a mobile phone. .

Fuxing Mobile has conducted surveys and customer portraits. Most of the users who bought fx1 and fx2 are from urban wealthy people and young people working in big cities.

The former group is really rich and doesn't care about price.

The latter group does not have much money, but because they work in big cities, they pay attention to dignity and live a more refined life. Moreover, due to the interactive design, Internet level, technological content, etc. of smartphones, they look far superior to old-fashioned functional phones. This is exactly what young people like the most.

As for young people, their consumption habits are different from those of the older generation. They don’t pay much attention to pragmatism. When they see something they like, they buy it on impulse, even if they have to pay the price of eating pickles and steamed buns for several months afterwards.

These two groups cannot represent all of China, the real China, so it can be quickly concluded that the penetration rate of Fuxing Mobile into the Chinese market is far from sufficient.

Lin Bing said at this time: "Before, there were only Fuxing mobile phones on the market for consumers to choose from. Now that there will be another choice, consumers will naturally make comparisons.

There are only two paths before us, one is to lower prices to ensure sales, and the other is not to lower prices and focus on developing new mobile phones.

Although the price reduction has preserved sales, it is likely to cause dissatisfaction among consumers who previously purchased mobile phones, thereby affecting brand reputation and style.

When new models are released in the future, it will be difficult to raise the price back again.

Because Chinese people have always liked to buy up rather than down, the high-end brand image we spent several years building with great difficulty was suddenly shattered, and the losses were huge and difficult to estimate.

My suggestion is that the price of the new model fx2 should not be reduced, and the price of the old model fx1 should be reduced again to compete with the Meizu m8. "

Xia Jingxing shook his head slightly, "After the release of fx2 half a year ago, the price of fx1 has already been reduced once. If the price continues to be reduced, it will be reduced to less than 3,000 yuan. This will also give consumers the illusion that it is not maintaining its value.

Moreover, fx1 does not have an app store. This alone cannot compare to Meizu m8.

Nowadays, the sales volume of fx1 has dropped sharply, and the 3G network license is about to be issued. The fx1 itself does not support 3g network. Strictly speaking, it is already an outdated product.

After this year, let it be completely discontinued.

However, you are right about one thing, that is, you cannot lower prices casually.

The fx2 has been on the market for less than half a year. Taking the initiative to cut prices gives people a feeling of lack of confidence, and will also damage the brand's reputation.

But brand style is not only supported by high prices.

The price is so expensive, is it a high-end brand? This is a joke.

We must focus on brand building on technology. Only continuous innovation and the launch of more competitive models are the keys to truly gaining a foothold in the high-end mobile phone market.

I'll leave the Meizu m8 alone for the time being. Sassafras clearly wants to use its low-price strategy to capture part of the market and make the Meizu brand a hit.

When sales increase, their supply chain will gradually mature.

And low price does not mean no profit. Meizu can still make good profits through small profits but quick turnover. The money can be used to expand the R\u0026D team and gradually transform a small factory that has transformed from MP3 players into a major mobile phone manufacturer. "

Zhou Guangping commented: "It seems that Sassafras is quite smart. He made us feel a little uncomfortable with this move, and there was nothing we could do to stop him."

"Stop him?"

Xia Jingxing laughed and said, "Why should we stop him? China's mobile phone market is so big and there are so many mobile phone manufacturers that we can't stop him.

Instead of always staring at your opponents, it is better to improve your mobile phone skills. "

Zhou Guangping was at a loss for words, didn’t you say you wanted us to discuss how to deal with the challenges posed by Meizu m8? Now I don't care about others anymore.

Xia Jingxing changed the subject and said: "Meizu is just a small factory now. Even if the m8 will impact the sales of the Fuxing FX2, the impact will be limited and acceptable.

But when Meizu becomes a major manufacturer, it is hard to say whether they will move from the mid- to low-end mobile phone market to the high-end mobile phone market. "

"definitely will!"

Zhu Zhaojiang looked at Xia Jingxing with a determined look on his face, "Meizu m8 chose to price it below 4,000 yuan. It seems like it is avoiding our edge, but is it not a way of hiding one's strength and biding its time?"

When Meizu's factory grows bigger and its brand becomes established, will they not be greedy for profits from the high-end mobile phone market?

On the contrary, if our sales in the high-end mobile phone market cannot continue to expand, our revenue volume and profits may be overtaken by Meizu.

From the perspective of the market direction we choose, it is like choosing Luxembourg. Although it is rich, the area is small and the upper limit is placed there;

Meizu chose Africa. Although it is poor, it is vast and vast. Once it develops, the upper limit is very high.

If Fuxing Mobile sells 5 million mobile phones every year and earns 2,000 yuan from each mobile phone, it will make a total profit of 10 billion yuan.

Meizu M8 sells 50 million units every year and only makes 500 yuan per phone, a total profit of 25 billion yuan.

In the mobile phone industry, whoever has the largest shipment volume will have a greater say in the face of supply chain manufacturers.

Whoever makes more profits can support larger-scale technology research and development.

Sassafras's choice is like surrounding the city from the countryside, consolidating Meizu's foundation by capturing the mid- to low-end market, and then planning for greater development.

He has made MP3 before, I guess he should have done in-depth research on the domestic market.

China has hundreds of millions of mobile phone users, all of whom are potential users of smartphones.

But the price of smartphones, which often cost four to five thousand yuan, is too high, which limits sales, resulting in only four to five million units sold a year.

But what if the smartphone is priced at 3,000 yuan? Maybe 10 to 20 million units can be sold a year.

What if the price is two thousand yuan, or even one thousand yuan? It may be possible to convert all of China's hundreds of millions of traditional feature phone users into smartphone users. "

As soon as these words came out, the whole hall was shocked!

Liu De shook his head repeatedly, "I am responsible for supply chain management, how can I still not know the cost of a smartphone?

When we produced the Fuxing FX1 before, the hardware cost of a mobile phone accounted for half of the selling price of the mobile phone, which was almost US$250, which was about 2,000 yuan at the time.

With the increase in sales, our bargaining power with supply chain manufacturers has increased a lot, and at the same time, we have caught up with the appreciation of the RMB.

Even so, the hardware cost of Fuxingfx2 is still as high as 1,500 yuan.

If you include marketing, administrative manpower, research and development and other costs, if the price of a mobile phone is less than 2,000 yuan, you will lose money on each one you sell. "

Zhu Zhaojiang smiled brightly, "Technology will always advance! I believe that with the popularity of smartphones and the continuous increase in sales, the entire supply chain manufacturer system will become more and more mature, and costs will definitely continue to decrease.

At the same time, when selecting components, save as much as you can. Don't pursue such high performance, just use them.

Once costs are controlled to the extreme, I believe there will be smartphones priced at 2,000 yuan or even 1,000 yuan in the future!

And it’s not selling mobile phones at a loss. It’s just that the profit may be very thin, but it can’t support its huge sales volume!

If the annual sales volume is 100 million units and each mobile phone earns 100 yuan, that is also a profit of 10 billion yuan. "

Zhou Guangping frowned slightly and said: "The current annual sales volume of Fuxing Mobile is 14 million units. Each phone earns more than 1,000 yuan, which is also a net profit of 10 to 20 billion."

Zhu Zhaojiang immediately shook his head and said with a smile: "Now that Meizu m8 has begun to impact our market position, it is obviously impossible for Fuxing Mobile to just sit back and make money like before.

Like Mr. Lin, I believe that there are only two roads before us, one is up and the other is down.

We will continue to make high-end mobile phones, maintain high investment in R\u0026D, and strive to win high in technology and brand leadership.

But there is a premise, which is to maintain a certain market share overseas. The current domestic economic situation obviously cannot support a high-end mobile phone manufacturer.

Even if we can barely make a living, we will be surrounded by Meizu or other mid- to low-end mobile phone manufacturers in the future, constantly eating into our market share.

On the downward side, we are focusing on the mid- to low-end mobile phone market, continuing to expand our mobile phone sales, and not letting others take over the strategic high ground. "

Liu De questioned: "Business in the mid-to-low-end market? How to maintain the brand style of Fuxing Mobile? This will affect consumers' perception of our high-end brand image. You are a typical loser of watermelons and sesame seeds."

Xia Jingxing did not interrupt, but smiled as he watched the senior executives engage in a heated debate.

It seems that without his guidance, this group of people has almost discussed the correct response plan.

He took a deep look at Zhu Zhaojiang. He was worthy of being the King of Africa. It seemed that he read the Little Red Book frequently.

Lin Bing suddenly interrupted everyone's discussion: "Make a new brand! A sub-brand! Let it be a supplement to the revived mobile phone brand, focusing on the mid-to-low-end mobile phone market, so that consumers will not confuse the brand impression.

Mr. Xia, you mean the same thing, right? "

Hearing this, others also turned their attention to Xia Jingxing.

"bingo!"

Xia Jingxing smiled slightly, someone finally guessed his true thoughts.

He put out information about Meizu M8 for everyone to discuss, with the purpose of drawing everyone's attention to the mid- to low-end mobile phone market.

This year is the year when Fuxing Mobile will be fully profitable, and it will also be a year of success.

But starting next year, things won't be so easy.

Meizu is the first mobile phone manufacturer to stand up and embrace the new era since the release of smartphones by Fuxing Mobile and Zhiguo.

By next year, there will definitely be more smartphone manufacturers springing up like mushrooms after a rain.

There is no doubt that the era of great competition in the mobile phone industry has arrived!

Whether it is to gain strategic initiative, to maximize the benefits of the mobile phone industry, or to popularize smartphones as quickly as possible to lay the foundation for the official launch of WeChat, he has to launch a sub-brand strategy.

He has been waiting for this day for several years.

There is another one who has also been waiting for several years.

Xia Jingxing looked at Zhu Zhaojiang and suddenly asked in a confused manner: "Zhaojiang, how are you doing with your English studies?"

:,!

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