Behind ZTE's battle with e-commerce brands: Samsung was too expensive and gave up the opportunity

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While ZTE Mobile recently made a big splash in South Korea, which even alarmed the top executives of Samsung Mobile, people were surprised to find that the "Star One" mobile phone, which ZTE Mobile claimed to have developed with the participation of thousands of people, was not a flagship phone to compete with Galaxy, but a popular 4G mobile phone priced at less than 1,400 yuan, and it was also an e-commerce brand phone. The "weird" logic of ZTE Mobile's new CEO Zeng Xuezhong has made people feel that his Internet thinking has been pouring out like a "tidal wave", and has brought about a rapid increase in ZTE Mobile's brand and sales.

The relationship between ZTE and "Star"

"ZTE mobile phone comes from the stars" is a mocking title given by a media outlet to a mobile phone recently launched by ZTE. Because ZTE named this phone "Star One", people immediately think of this year's hit TV series "My Love from the Star".

Not only that, the press conference of "Star No. 1" was held in Seoul, South Korea, with hundreds of media reporters and fans. The huge five-star hotel was filled with the starlight of "Star". At the press conference, the host dressed up as "Cheon Song Yi", and ZTE Terminal CEO Zeng Xuezhong even played "Professor Zeng" himself. Not only was the mobile phone full of avant-garde, but even the press conference was full of ease and fashion.

But this expensive phone is not a flagship phone. ZTE announced on the spot that the price of "Xingxing No. 1" is less than 1,400 yuan. Moreover, this phone is mainly sold on e-commerce platforms. Normally, mobile phones sold on e-commerce platforms are mainly cost-effective, and they are reluctant to spend money on brand promotion, and even more reluctant to spend huge amounts of money to hold press conferences abroad, but "Xingxing No. 1" goes against the trend.

"The Xingxing No. 1 phone will be sold on JD.com (rolling news) in the first two months. It is impossible to have a lower price than JD.com." Amid media doubts, ZTE Terminal CEO Zeng Xuezhong still answered with certainty. This is how ZTE builds an e-commerce phone.

Samsung's high mobile phone prices provide opportunities for domestic brands to expand

Internet thinking + first e-commerce sub-brand mobile phone + 4G mobile phone + thousand-yuan phone, ZTE's launch of "Star One" has whetted everyone's appetite from the beginning. However, not only that, ZTE Terminal CEO Zeng Xuezhong not only went to Seoul, South Korea to hold a press conference, but also visited and toured Samsung Mobile's headquarters in person. It is said that the senior management of Samsung Mobile's headquarters was shocked. They were confused as to why ZTE Mobile had to hold a press conference in South Korea, and even kept spying on which Korean media ZTE had invited. It is obvious that Samsung is worried that ZTE Mobile will attack Samsung's home position.

This is not impossible. "The prices of Apple (524.94, 5.93, 1.14%) iPhones and Samsung phones are too high now. I believe they will return to a reasonable price," Zeng Xuezhong said.

In fact, it is the high-price strategy of Apple and Samsung in China that has made domestic mobile phone brands better and better in recent years. For example, the price of Samsung's newly launched S5 is as high as more than 5,000 yuan, which has long been considered lacking in novelty and was even directly mocked by HTC as a "plastic phone".

Like many Samsung models, "Star One" takes the fashion route, with simple and beautiful design and voice control function as its main features. It is known as the "most beautiful and most obedient" mobile phone in the world. Various elements of this phone are related to stars, and even the colors are named Galaxy White, Star Black, and Star Diamond Pink. In particular, Star Diamond Pink is said to be directly inspired by the color of the pink planet in the "Inner Oort Cloud" newly discovered by astronomers this year.

ZTE has determined that the price of the phone will be less than 1,400 yuan, but some people think that the "Star One" has taken the opposite route, that is, the price is too low. In this regard, Zeng Xuezhong said, "Whether ZTE's previous price was too low depends on the market. ZTE will provide users with cost-effective mobile phones and use scale to gain cost advantages. ZTE's cooperation with JD.com is not limited to mobile phones, but also includes IT systems, virtual operator services and other aspects.

ZTE e-commerce sub-brand layout

It is reported that the grand "Xingxing No. 1" is just the beginning of ZTE's creation of e-commerce mobile phones. "Xingxing" will be the name of this series of mobile phones. This is not only the homonym of the word "Xing" in ZTE's name, but also cleverly associates it with the hit drama "My Love from the Star".

"Last year, ZTE did not have a single product in the e-commerce field," said Zeng Xuezhong, CEO of ZTE Terminal, who obviously regretted ZTE's previous e-commerce strategy. It has long been said that Xiaomi's rise was not without miracles, but that several major mobile phone manufacturers in the "China Cool Alliance" did not realize the importance of e-commerce, which led to Xiaomi's unexpected success by relying on e-commerce. Zeng Xuezhong obviously saw this huge market opportunity, and "Star One" was born.

He also said that in the future, ZTE mobile phones will focus on covering the popular 4G market, focusing on products below 2,000 yuan, forming a product system mainly consisting of the Grand series below 2,000 yuan, the "Star" series between 1,000 and 1,500 yuan, and the "Red Bull" series below 1,000 yuan. The sub-brand Nubia will take on more of the responsibility of impacting the high-end mobile phone market.

"Xingxing No. 1" is also the first new product launched after ZTE and JD.com established a strategic partnership. Regarding how much "Xingxing No. 1" should be sold on JD.com's e-commerce platform, Wang Xiaosong, vice president of JD.com, said that JD.com's sales data show that mobile phones below 1,000 yuan have the largest sales volume. Currently, the sales volume of mobile phones priced between 1,000 and 2,000 yuan is growing faster, mainly domestic brands, while mobile phones priced above 3,000 yuan have declined significantly, which reflects the rapid growth of domestic brands. The implication is that ZTE's "Xingxing No. 1" is in an area with the largest growth space.

In fact, the mainstream and efficient hardware configuration, 5-mode 13-frequency network coverage, novel and unique software applications, photon payment, and 4G standard of "Star One" are indeed beyond almost all existing e-commerce 3G mobile phones. Obviously, after Zeng Xuezhong proposed "Internet thinking" three months ago, ZTE Mobile Phone has truly begun to transform towards consumers and younger people.

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