Xiaomi Leijun recently participated in the shooting of the public welfare propaganda film quoted the lines of the film “Star Wars”: “the road is under your feet, make your choice”. Under the epidemic situation, the smartphone market, which continues the downward trend in 2019, has been superimposed with more uncertainties. The choice made by smart phone brands is to carry out “self-help”: they return to work and resume production, they promote the launch of new products, they increase the online channels, they optimize software services, and they plan to sail to sea again A big drama with the theme of “change” is being staged. Will the smartphone market, which has already pressed the restart button, continue to press the fast forward button?
The new year’s new products arrive as scheduled, and the rhythm seems not to be disturbed
In 2019, the overall trend of the smart phone market is not ideal, but the industry is not immersed in an atmosphere of uneasiness. After all, the era of 5g has begun, and a broader “phone change movement” is brewing. According to the data of China Academy of communications and communications, the sales of domestic 5g mobile phones in the last two months of 2019 exceeded 5 million, and the total annual sales volume exceeded 13 million. On the understanding of nail technology, under the trend dividend, most manufacturers have high expectations for 2020.
It is hard to predict that, as an unexpected guest, the sudden outbreak of the epidemic wants to press the “pause button” for the industry that was bathed in the light of hope. It can be said that the timing is just right: the Spring Festival. “Bad news” followed
GSMA announced the cancellation of the world mobile communication conference “due to force majeure”. There was no such precedent in the previous 25 years.
Global smartphone shipments in January were 100.5 million units, down 7% from a year earlier, according to strategic analytics. Huawei decreased by 39% year-on-year and 14% month on month; Apple increased slightly year-on-year with a decrease of 38%; Samsung decreased by 1% – 2% year-on-year and month on month.
According to the data of China Academy of information and communications, China’s smartphone shipment volume in January 2020 was 20.366 million units, down 36.6% from January 2019.
However, at this time, smart phone manufacturers showed a kind of stubbornness. New products of several brands were released online in the “cloud” as scheduled:
On February 13, Xiaomi 10 series appeared;
On February 24, there were four releases. Huawei’s new folding screen mobile phone matexs “came out of the market in C-bit”, and the company launched V30 pro and 9x Pro overseas. Sony’s first 5g flagship Xperia 1 II and realme’s new 5g flagship X50 Pro appeared;
On February 25, iqoo, a sub brand of vivo, launched iqoo3 5g “performance flagship”;
On February 27, Samsung released the flagship “family bucket” of Galaxy S20 series, followed by a new generation of vertical folding mobile phone Galaxy Z flip;
On March 3, black shark, a brand of game phone, released three series of new 5g deep customized Tencent Black Shark game mobile phone 3 and 3 Pro.
5g, flagship, large screen, high resolution, high performance, high pixel, large capacity battery This batch of intensive and luxurious operation, it seems that the consumer side once again ignited enthusiasm.
Under the epidemic situation, in the face of production pressure, it is not easy for manufacturers to maintain the previous product release inertia, but it is very necessary. Nail technology believes that there are three reasons for manufacturers to actively ensure the launch of the new year’s flagship: first, to maintain market consumption expectations and activate consumption enthusiasm; second, to boost their own confidence and boost the morale of returning to work and production; Third, to realize the benign operation of resources and ensure the smooth progress of follow-up reproduction.
Mobile phone manufacturers actively “save themselves”, but a real battle has just begun.
Facing the double “squeeze” of supply chain and consumer market
Although there are quite a number of analysis that the outbreak caused the adverse start of the smartphone market in January, in fact, the impact of the epidemic has come to China’s Spring Festival, that is, the end of January. The impact has been relatively limited. The more important reason should be the continuation of the downward trend in 2019.
As for the Chinese market, which is the most important part of the global smart phone market, according to the report released by the China Academy of communications and communications on January 9, the total domestic mobile phone market shipment volume in the whole year of 2019 is 389 million, a year-on-year decrease of 6.2%.
The continued downward trend and the adverse effects of the epidemic stage will make the smartphone market worse for a period of time. According to IDC’s forecast report, global smartphone shipments will fall by 10.6% in the first half of 2020 and 2.3% in the whole year.
From the perspective of nail technology, terminal manufacturers will face double “squeeze” of supply chain and consumer market in the stage of epidemic impact
Look at the supply chain first.
“China’s influence has been everywhere”, which is reflected in the smartphone industry, not only in the numerous terminal brands and products sold to the world, but also in the upstream supply chain, which is also one of the important “rear areas” of global mobile phone brands. From the front screen panel to the packaging, testing and storage semiconductor of internal chips, to the sensors and cameras on the back, China’s supply chain is indispensable. The difficulty of resuming work and logistics inevitably results in the limitation of production capacity and supply.
At the same time, it should be noted that in Taiwan, Japan, South Korea and Southeast Asia, where the basic supply chain is also concentrated, the epidemic continues to spread and the impact exists at the same time.
At the production level, Guangdong and other places, once seriously affected by the epidemic, are important “factories” of smart phones. Even if the impact of the epidemic is weakened, it will still take some time to recover, which may not be able to meet the capacity needs of terminal manufacturers.
From the above, it is inevitable that the expectation of the whole machine delivered to consumers will be affected. In a recent micro blog, Lu Weibing, vice president of Xiaomi group, said, “but due to the serious impact of the epidemic on production, so far, our production satisfaction rate to the demand is still relatively low, but we try our best to meet the delivery”, which may lead to consumers’ enthusiasm for machine replacement There is a trend of increasing first and then decreasing.
Look at the consumer market.
From the perspective of market sales, periodic travel obstacles and offline channels will, to a certain extent, dispel the desire to buy products; coupled with the possible negative impact of the epidemic on China’s economy in the medium and short term, many people will choose to wait and see with money out of the instinct of risk aversion, so the pricing part of products needs to be reconsidered.
From the perspective of consumer purchase, the demand still exists, but on the one hand, the consumer demand is more obviously directed to experience upgrading rather than simply renewing; on the other hand, consumers need more smooth access to the channel. In addition, in the special period, users may have higher expectations for product delivery and other services.
Whether it is active or passive, terminal manufacturers must make changes.
Changes centered on “cost reduction” and “risk resistance”
The smart phone market has never been short of changes, some directly point to the operation strategy, and some are limited to performance display. However, from the perspective of nail technology, the changes of terminal manufacturers will return to the nature of business more under the epidemic situation, and the key words will be “cost reduction” and “risk resistance”.
The first is the change of sales channel selection tendency.
In the past two years, it is obvious that top brands including Huawei (including glory) and Xiaomi are actively laying out offline. For example, glory has successively laid out many experience stores, which are caused by three reasons: first, the decline of online traffic dividend; second, the popularity and reputation of brands accumulated by offline space represented by Apple experience store; and; Third, the offline channels represented by OV stores have brought considerable profits to the brand.
However, under the epidemic situation, the plot has reversed and the offline channels are blocked. Therefore, online is the more feasible choice, which is not limited by space and can reduce costs relatively. Such a change may lead to the adjustment of the market pattern in a certain period of time. The brand that once had a dominant position in the online channel will achieve Matthew effect and gain more shares in the epidemic stage and a period of time thereafter. Of course, in the long run, consumers’ offline experience habits will not change. In the end, what terminal manufacturers need to change is their thinking. Whether online or offline, a single channel is too much, and combination and balance are the key.
Secondly, the change of marketing communication channel choice.
More attention to online publishing has become the common choice of terminal manufacturers. There are two key points
First, it has little impact on consumers. The press conference is one of the marketing links. Online publishing can also convey full and detailed product information to consumers and potential consumers, and at the same time, it can bring more people a sense of participation.
Second, it can save a lot of money. The budget of mobile phone manufacturers is usually not low, and online release often does not need a lot of expenses, especially if the communication effect is close to that of offline release, this option has more advantages.
From the perspective of nail technology, even after the end of the epidemic, compared with the two-line balance in sales channels, in terms of release, considering the cost control and the similar effect, the terminal manufacturers are likely to be more inclined to online, and the online based product release has become a fixed mode.
The third is the change of product level, including three aspects: first, new frequency; second, sales pricing; third, new product planning.
Considering the phased weakening of consumption intention, terminal manufacturers need to stimulate enthusiasm. The launch of new products is the key. There are intervals but high frequency of new products. It may be a more effective way to continuously wake up the market through a batch of new products. This is also the conventional way of playing at the initial stage of the rise of some Internet brands.
Considering that consumers hold currency for purchase, terminal manufacturers need to reconsider product pricing. On the one hand, they can reduce the cost of other parts and make concessions on the price; on the other hand, they can also cooperate with channels and adopt interest free installment and other ways to alleviate consumption pressure.
Considering the change of new product frequency and sales pricing, manufacturers may also have special strategies for new product planning. That is, while there is no obvious change in the configuration of the main body, fine adjustment should be made on the appearance design and other aspects, and the model should be changed. As can be seen before, oppo Reno 3 Pro and realme X50 of “oppo series” are two similar products. In addition to considering the acceleration of new frequency and concession of sales pricing, we should also consider the capacity of the supply chain and the cost of open die production. When consumers choose new products, they may as well pay more attention to product details.
From the second is to profit from content services.
If we say that the above three changes highlight the “cost reduction”, and the outstanding transformation content service is “anti risk”.
Earlier last year, terminal manufacturers showed more interest in content services, and Huawei video reached a deep cooperation with Youku, opening up accounts of both sides. On the one hand, there is a successful precedent for the “combination of software and hardware” to achieve deep user operation; on the other hand, under the overall poor market environment, new business can bring more profits. Considering that the market downturn continues, Huawei, Xiaomi and oppo have been actively deployed in this part. Under the epidemic situation, more top brands should join the ranks.
Finally, we should seek opportunities from overseas markets.
On the one hand, the product sales market, whether or not the outbreak of the epidemic, can not change the fact that before the outbreak of 5g dividend, the demand for renewal in China market was not sufficient, and the terminal manufacturers must look for new growth space; On the other hand, the Enlightenment of the epidemic is that brands need to reconsider the supply chain and OEM production layout, reduce the risk of relying on a single region, and establish a “Backup Base” for supply and production overseas.
The downward trend continues to add to the negative impact of the epidemic. If the smart phone market wants to achieve real improvement, it is not enough to press the “restart button”, but the “fast forward” button must be pressed.
Dickens said: “there are many difficult things in the world, in which one can show his true qualities.” Roman Rowland said: “there is only one kind of true heroism in the world, which is to love life after knowing the truth of life.” Similarly speaking of heroism, the latter seems to be more active, proactive and optimistic, which is exactly what the smartphone market needs.