As the mobile phone market has gradually stabilized, many mobile phone brands have started a 'side business' and seek diversified development. These 'side businesses' can be basically divided into two categories, namely, related and unrelated to the main business, with almost no association. In the field, we can even see products such as dry batteries. Although diversified development can broaden its own field, it may bring more profits and increase visibility, but is this road applicable to every brand? Especially for small and medium-sized enterprises. In terms of brands, is diversification really beneficial?
Small and medium-sized brands are keen on diversity
Nail Technology notes that small and medium-sized brands are quite keen on diversification.
Meizu has carried out many other attempts in the past two years, Meizu bracelet, Meizu box, Meizu router to Meizu suitcase, leisure bag, storage bag, etc. But Meizu’s main thing is to do a lot of inexpensive headphones, recently The Gravity suspension speakers have gained a lot of word of mouth, probably because Meizu MP3 started, it is easy to do.
Although there is no smart hardware, I have sold a bunch of bags, from wallets to backpacks, and an environmentally friendly ballpoint pen. CEO Liu Zuohu himself said frankly at the press conference that they are the best in the mobile phone brand. Ok.
The hammer mobile phone has been very difficult in the past two years. The sales volume has always been a problem, but the first product of the hammer chain's ecological chain is still released. The intelligent air purifier is breathed, aiming at the northern market, and introducing anti-fog masks. A lot of Smartisan brand clothing.
The important reason why small and medium-sized brands are keen on 'side business' is likely to be the status of the Red Sea in the smart phone industry. Counterpoint data shows that the profit of the head mainstream mobile phone brand has exceeded 100%, and the small and medium-sized mobile phone brands are in a loss overall, marching into the 'side business', Is better to survive.
Three major challenges of diversity
However, for small and medium-sized brands, diversification is actually a 'double-edged sword', and it will face three major challenges while gaining benefits:
First, the capital resources are insufficient. The disadvantages of small brands compared to big brands are obvious. Once the big brands are diversified, they will quickly seize the market with greater reputation and better supply chain control.
The implementation of these sideline businesses is also the investment of funds. Although the profits are relatively high, the premise is that they sell out and do too much, but they may not have corresponding reserve funds, and resources are used as a guarantee.
Second, distracting energy and resources.
To expand the business to a certain extent, it will disperse resources and disperse a lot of energy. This will increase the pressure on management, increase the difficulty of coordination between departments, increase communication costs, and reduce efficiency.
Small brands are inherently at a disadvantage, coupled with the fact that funds are not as good as big brands, and then they have to disperse a lot of resources, so that the main business that should have gone all out is difficult to display, and some are not worth the candle.
Third, the resources of small brands cannot form an ecosystem.
A complete set of ecology will bring a good consumer experience.
Small brands can't form such a huge ecology, there is not enough money, there are not enough supply chain channels, so there are not so many commodities to form an ecological chain. For small brands, become a part of the big brand ecological chain, perhaps It works.
In summary, today's small-brand mobile phone manufacturers are diversifying. In fact, most of them are for better survival, but they also face huge risks. If they can't grasp the scale, the booth will be too big, and even affect the whole. Brand.