In the latest Q3 industry report, SA and IDC both agree that Huawei handsets are approaching the Apple runner-up with 39.1 million shipments, with OPPO at 30.7 million and millet doubling at 27.6 million Back to the mainstream camp, familiar with the Three Kingdoms seems to come back.
Ren Zhengfei recent finale summary at Huawei IRB product improvement briefing is widespread, a total of seven points, of which the last point intriguing:
Pay attention to low-end mobile phones! Ninety percent of the world's are poor, low-end mobile phone companies have a poor market, do not underestimate them. Huawei also have to do low-end machines, our old product may be precipitated low- .
This friendly business did not singled out, but into the French mobile phone brands, in addition to Lei Jun mouth use of 'asymmetric information in the 345 cities' OV, I am afraid only sales picked up the millet, not to mention the news comment area' Eat melon masses' already long ago automatically stood up.
Contact Huawei immediately after the introduction of Mate10 new machine 5, many people think that the poor mobile phone is the recognition of the concept of cost-effective millet, but so understanding of mobile phone shipments battle is not thorough, in the context of Lei Jun and millet, the price About three connotations:
1, eliminating the profits of the mobile phone industry?
Millet birth to respected 'cost-effective' and 'for a fever' for two purposes, one is to separate the cottage phone is still very strong at that time, the second is to find a sense of belonging when Apple holds the pricing power.
As can be seen from the early system of rice nouns, quite a few people acknowledge the millet profiteering, though this has never been achieved, for example, the first iPhone 4s was $ 649 and the newest iPhoneX was $ 999. Released in March of the Samsung Galaxy S China's first primary price is 3400 yuan, while in May this year released S8 starting price is 5688 yuan.
There is no sign that the domestic mobile phone represented by millet restrained the price increase or profitability of Apple and Samsung. At the time, Microsoft Ballmer had similar judgment with rice flour, he thought 'iPhone did not have the opportunity to gain a large amount of market share and had no chance This is a $ 500 thing, they make a lot of money ... ... the next 5 months in their hands only the world's most expensive cell phone can be sold, let us see what happens? .... .. I think Apple can only get 2% to 3% market share. 'This judge let him continue to be face after many years.
The truth is that a product whose pricing is obviously higher than the cost does not make a huge profit for the consumption scene and people it adapts to. Even industries with particularly cost-effective industries are no exception, ignoring this logic just as Li Shufu said at that time was nothing more than a vehicle Like a wheel plus a few sofas, Zotye has also long been annihilated Porsche, Land Rover, Audi and Mercedes-Benz.
2, sublimation from the business strategy for the values?
Lei Jun years on the statement about the cost-effective changes, but the connotation has not changed, the initial millet division Apple committed to the ultimate single product, only 5 years 3 mobile phones, with Lei Jun's words is to promote 'geek spirit, get rid of the middle part Later, he proposed cost-effective. Earlier in the conference of Pine Cone Chip, Lei Jun further emphasized that "the price will be persisted in the end," and co-founder Li Wanqiang simply stated that the value for money is the value of millet.
However, this means that the shipment of millet more depends on low-end mobile phones. The red rice sold in India is equivalent to about RMB 740 yuan. In the domestic online channels, the average unit price of millet H1 is only 1168 yuan this year.
Millet's strategy can be summarized as the use of red rice and other low-end products in the value of Routines, while relying on offline millet house into the service, pulling the high per capita purchase to take the amount .Leijun at the China Green Company Roundtable confession : 'Many people think that consumption upgrading is getting more and more expensive, but I think this is a no-return. Can we improve efficiency and provide better services under the existing conditions so that you can survive in the future competition? Get on '.
According to previously released data by Lin Bin, Xiaomi's single-store monthly income was 5,190,000 yuan. After the average midweek weekend, the monthly sales flow reached 45,000 and the conversion rate was about 20%, equivalent to 9,000 people forming a per capita single product 2.7, according to projections, millet's unit price is not high, but the per capita consumption has exceeded 1,500 yuan.
3, to strengthen the advantages of followers.
Before 2014, there were over a thousand Internet handset brands in China, such as Glory, Meizu, Iga, Nubian, Hammer, ZUK, Coke, IUNI, LeTV, Kiwifruit, Shallots, Aliyun and so on. Extinction, in addition to the glory of rapid development has challenged the strength of other brands under the pressure of cost performance in millet, either fought overseas or returned to the niche market, or sadly quit, at least in blocking the next black swan this incident, millet It is successful.
However, judging from the current industry pattern, the idea of maintaining a cost-effective ratio is not dependent on the subjective intent of the Leiyun Army but is related to the position of Xiaomi in the entire industrial chain.
1, there is no cost advantage millet?
When Zhou Hongyi demolished in 2012, microblogging said that each profit of Xiaomi's mobile phone reached 700-800 yuan, which was estimated at 10 billion PE by a hardware company and predicted a price reduction of 1,000 yuan in two months. Then counter-attack millet phone can be disclosed tax and patent fees total has reached 400 yuan.
In the Lei Jun view, millet's cost performance is 'systematically reduce the overall cost, not to reduce manufacturing costs', he believes that some brand ideas wrong, 'users want to buy the product, not to buy promoters, not to buy ads.'
But today Xiaomi ODM in the links outside, the compression channels and marketing costs are actually very difficult.
Li Wanqiang zero-cost word of mouth marketing era as early as the past, millet start running TV commercials in 2015, not only the popular artists endorsement, the enthusiasm for the network variety shows unabated, including the sky title "wonderful work."
The concept of cost-effective can really compress the R & D investment.
Xiaomi and Apple, like product innovation rather than technological innovation route, focusing on shaping the user's ecosystem, Apple last year R & D investment 8.1 billion, as Huawei's 94.8 billion, Samsung's 12.7 billion less than the heyday of HTC, R & D costs even more accounted for 0.8% of revenue.
Xiaomi's R & D investment has not been reported, but can be glimpsed into the details from a detail According to the relevant provisions of the national enterprise income tax concessions, high-tech enterprises to meet the three indicators can enjoy 15% discount: First, research and development costs as a percentage of revenue , The annual revenue of 200 million yuan or more enterprises shall not be less than 3%; second is the high-tech products or services to account for more than 60% of total revenue; Third, employees of scientific and technological personnel and research and development staff to achieve respectively 30% and 10% .
In 2014, Lei Jun consulted with Hu Wenxue, head of the State Administration of Taxation in Beijing Haidian, and said that the business conditions of Internet companies have changed greatly. If one indicator fails to meet the standard, whether it can be calculated by a three-year average can be calculated based on the product and personnel composition of Xiaomi The latter two indicators are not difficult, the only variable is the research and development costs.
2, the cost from the purpose into a means.
Over the past two years, millet back the technical route, in the face of adversity and then pick up the growth momentum, more product innovation, new retail and marketing efforts, the concept of cost-effective contribution is not large, on the contrary Xiaomi launched a series of cost is not high Product, the biggest danger of millet lies in the saying that cost-effective itself is becoming the core competitiveness.
3, kill the middle of it?
In the Lei Jun's cost-effective strategy, using their own new retail instead of intermediate links to reduce channel costs is an important part, which stems from three observations: First, online channel costs continue to rise, has been flat with the line; Second, the concentration of electricity providers The higher and higher degree, 618 and double 11 big time let Rangli out of control trend; Third, online users slowed down, and the proportion of the line under the open March 37 steadily irreversible.
For two consecutive years, double 11, millet and glory of the fight is very tragic, in order to increase sales have to provide additional discounts, which makes the average unit price of millet under greater pressure to bear this year's situation is also about, as of November 7 Jingdong Real-time mobile phone rankings, the top three followed by Apple, Glory and millet.
Whether the cost control of the new retail is more effective remains to be proved, according to Lin Bin's estimates, a second-tier cities millet home area control in the 200-400 level to ensure that no loss, which is determined by the passenger flow, the average single shop renovation costs 500,000 In the final analysis, the effectiveness of Xiaomi's millet home is guaranteed by increasing the number of purchased single products per unit and the replenishment rate. This is the basic logic of cost performance and of course depends on the ability of Xiaomi's ecological chain to expand.
4, cost-effective will be India's market logic rather than China.
Meizu Li Nan said the original price of 'dangerous' Meizu mobile phone heavy volume at that time is completely dependent on Charm Blue, Charm Blue Note2, Charm Blue 2 and Charm blue metal thousand machines, high-end MX5 and PRO 5 limited impact, in order to enhance the brand image It is necessary to control production capacity at a critical node of 25 million shipments.
Today's millet continues this idea, but the content is slightly different.
According to IDC's Q3 data, there are 27.6 million global shipments of Xiaomi, 15.7 million mainland China and nearly 12 million overseas. However, it mainly relies on the Indian market and has already shipped 4 million copies a month, India has been the main driving force for growth in millet millet India's official website of the main selling models millet MIX2, millet A1, millet maximum 2, red rice Note 4, red rice 4 and red rice 4A, two new machines are red rice Y1 and red rice Y1 Lite, in addition to Millet MIX2 is to display the tone of the brand image, the other are low-end take the amount of product, indicating that India is not the price the main battlefield.
Lei Jun tried to replicate the cost-effective splendor in India, injecting services to millet home in China and getting rid of the low-end image, but they are all at risk. The former is influenced by the environment of Sino-Indian relations and the Indians are improving their awareness of mobile phones (Millet ads claim to be rice in India, resulting in some Indians mistakenly believe that millet is a domestic brand), the latter depends on whether the millet house, like Apple's Apple Store can create technology and fashion like the atmosphere, and then firmly tied fans in Business + religious fanatic.
The price of millet inside the face of the pressure is also increasing, millet MIX release, co-founder Wang Chuan recommended pricing 9999 yuan, Lei Jun insisted 3999 yuan, which later he Yabuli forum on the position: 'When almost all of them When I advised you to sell your millet products for sale, I felt lonely because they did not understand my dream and my pursuit.
Cost-effective in millet, not so much a strategy, it is better to say Lei Jun personal obsession.