Transsion Holdings (hereinafter referred to as "Transsion"), a company that most Chinese people have never heard of, set a record in 2019 mobile phone shipments of 137 million units, a global market share of 8.1%, ranking Fourth, Africa has a market share of 52.5%, ranking first in . The agency predicts that TRANSSION’s mobile phone sales will exceed 150 million units in 2020.
"African Business" magazine published in the British "African Business" magazine in 2020 the most popular brand of "_strong33_strong7 Top 100 Most Popular Brands in Africa) The three mobile phone brands TECNO, itel and Infinix are ranked 5th, 21st and 27th respectively.
Why did a Chinese brand choose Africa, and how did it become the "king of mobile phones in Africa"?
Why did Transsion choose Africa?
Founder of Transonics Zhu Zhaojiang He was responsible for the development of overseas mobile phone markets. He traveled to more than 90 countries and regions and realized that Africa, with a population of more than 900 million and a mobile phone penetration rate of only 20%, was a blue ocean market with great potential.
In 2006, Bird, the "fighter in mobile phone", changed the track and started to build cars. Zhu Zhaojiang founded Transsion after his departure. Seeing that the capacity of the African market is large enough, there are enough opportunities, and it is not valued by the giants. So since you can't become a tiger in the vast forest, then become a king in a place where there are no tigers. Under Zhu Zhaojiang's leadership, Transsion took less than 10 years to sit on the position of the "King of African Mobile Phones".
Behind the success of Transsion, products, prices, after-sales, channels, and marketing are all powerful tools.
Only when you understand Africa can you conquer Africa
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TRANSSION Holdings was selected into the list with its management practice of "localized innovation centered on users in emerging markets".
takes users as the core and deeply understands consumer needs,And based on this, continuous product innovation and upgrading is the foundation of Transsion's success.
Transmitting first entered Africa. The survey found that there are many operators here but the signal is very unstable, and the cost of calls between different operators is very high. 2-3 SIM cards per person are very common. However, brands such as and Nokia , which adhere to international standards, sell single-card phones in Africa. Based on this, TRANSSION launched dual SIM dual standby. In 2007, TRANSSION's mobile phone was first sold in Africa, and it was sold out in just one month.
In response to the problem of mobile phone charging in Africa, Transsion will use long battery life as a power point. has developed low-cost and high-voltage fast charging technology and introduced a feature phone with a standby time of more than 20 days. Even play a 10,000 mAh battery standard ; Africa has a hot climate, people love to sweat and sweat is very acidic. Based on this, has developed an acid-proof phone coating, a sweat-proof USB port, and at the same time improved the accuracy of fingerprint recognition of the phone in the case of sweating .
Africans love music, and Transsion has developed a bass design and speaker design suitable for African music. In 2015, Transsion launched the Boom series of mobile phones with the main music function. and NetEase cooperated to develop the music streaming platform Boomplay,Now it has become the largest music streaming media platform in Africa. On March 17, 2020, the cooperation between Boomplay and Universal Music was upgraded again, and its copyright area expanded from the original 7 African countries to 47 Pan-African countries.
A new technology developed for the skin of African people and is the highlight of Transsion’s king . The mainstream mobile phone camera uses facial recognition, this technology is suitable for light-skinned people, but this has also become a pain point for dark-skinned people to take pictures. As a result, TRANSSION has developed personalized application technologies such as dark-skinned camera technology based on the positioning of eyes and teeth, night photograph capture technology, and face recognition and unlocking functions in dark places.
In order to better serve local customers, TRANSSION has conducted secondary development of Android system platforms such as iOS, strongl4 and Hspan3span intelligently. Operating system and independent application software platform . And centering on the OS to further promote its own platform construction and operation, it has developed many tool applications such as application stores, game centers, advertising distribution platforms, and mobile phone butlers. TRANSSION has joined hands with Internet giants such as , Tencent, and Wenwen to cooperate in the application fields of music, games, short videos, mobile payment, content aggregation, etc., forming a high-traffic application product matrix.Create a new business growth engine. And it has developed in-depth cooperation with world-renowned companies such as Vodafone, Orange, Google and Facebook to better meet user needs.
The mobile phone market does not lack good products, but the African people need products that are suitable for local needs and are inexpensive. And Transsion not only made products more suitable for Africans, but also adopted a low-price strategy in terms of prices. African people are extremely price-sensitive, and the models launched by Transsion are extremely attractive in price. According to official data from Transsion, the average price of their feature phones is only 62.4 yuan, and the average price of smart phones is 441.7 yuan. The low price is the absolute weapon for Transsion to win in Africa .
is different from the brands that came to Africa with a shot in the early days. TRANSSION is doing a long-term strategy. For the long-term development of the brand, TRANSSION integrates all after-sales services and establishes a special After-sales service brand Carlcare . At present, Carlcare has more than 2,000 after-sales service points, not only repairing its own mobile phones, but also helping consumers repair other brands of mobile phones. Carlcare has become the strongest mobile phone after-sales service brand in Africa.
In terms of marketing,Transsion adopts the strategy of "marketing everywhere" to increase brand awareness. Africa is so vast that it is difficult for mobile phones to be promoted in a centralized manner. Transsion moved the domestic practice of arranging wall-washing advertisements to Africa. The "wall-washing" marketing method has a significant effect in Africa where infrastructure and Internet are underdeveloped. TRANSSION’s vice president Arif once said that in Kenya , newspapers, outdoor advertisements, and televisions, TRANSSION’s advertisements can be seen everywhere. Taking 2018 as an example, TRANSSION’s promotional expenses were 706 million yuan, accounting for 31.34% of sales expenses over the same period.
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span . Thanks to effective supply chain management, the company's inventory turnover days of 55 days are less than 's 64 days of millet; in the case that the original product unit price is low, relying on the advantages of scale, Transsion maintains nearly 30% of gross profit .
Distribution channels throughout Africa are the foundation of Transsion's foothold in Africa . The establishment of channels to upload audio has its own unique features. In the poor rural market where other manufacturers are unwilling to enter, Transsion has successfully integrated a dealer system. At present, Transsion has established a marketing channel network with wide coverage, strong penetration and high stability, which is mainly sold by dealers and supplemented by sales by a small number of operators. In many countries in Africa, the political situation is turbulent and wars continue. The dealer model has greatly reduced sales risks. At present, TRANSSION’s products have entered more than 70 countries and regions around the world.It has established close cooperative relations with more than 2,000 dealers and customers with rich sales experience in various markets, and has formed a sales network covering Africa, South Asia, Southeast Asia, , the Middle East and South America and other major emerging markets in the world.
Based on the huge distribution network and marketing team in Africa, it is a logical choice for Transsion to cut into digital accessories and home appliances that are very related to mobile phones. TRANSSION has now established Oraimo, a 3C product accessory brand, whose main products are smart speakers, smart bracelets, mobile power supplies, earphones, etc. Home appliance brand Syinix, its main products are TVs, air conditioners, washing machines, etc.
With the successful experience in the African market, TRANSSION has entered into more emerging markets with a market share of more emerging countries. , Ranked second, with a market share of 6.8% in India, ranking fifth.
However, with the slowdown of Red Sea market smartphone growth, the giants have set their sights on new consumer markets such as Africa, and the pressure of competition in the sound transmission market has doubled!
When the crisis is coming, how can Transsion help itself?
In 2019, Africa’s mobile phone shipments were 220 million units.Among them, smartphone shipments were 90 million units, accounting for 41%, and the five-year CAGR was 10.8%.
According to research company GfK South Africa, the value of South Africa’s smartphone market has climbed by nearly 3%, and consumers have begun to buy high-end models with larger screens. According to GSMA's forecast, the penetration rate of smartphones in Africa will reach 67% in 2025.
The transition from functional phones to smart phones is a market trend, but the price of functional phones and smart phone technology are . TRANSSION relies on Sun Zhengyi's time machine theory, hits the time gap in technology, and achieves wealth through products, marketing and low-price strategies, but its core technology is not leading.
As the growth rate of the Red Sea market for smartphones represented by China, Europe and the United States slows down, the African market, which has a low smartphone market share, has become a strategic choice for giants. In recent years, the Big Four of Span1span Huawei, Xiaomi, and OV have set their sights on the new consumer market. At the same time, Mara Phones, known as "Huawei in Africa", cannot be ignored.
The prospectus shows that TRANSSION and its subsidiaries have 97 patents in China, including 630 invention patents.There are 385 utility model patents and 148 design patents. Compared with peers, according to the "Annual Report on Announcement of Invention Authorized Patents in 2020" released by incoPat, the number of authorized patents for Xiaomi is 1,337, 3580 for OPPO, and 6,393 for Huawei.
Although Transsion was listed on the Science and Technology Innovation Board in 2019, its insufficient R&D investment is often criticized. From 2016 to 2018, TRANSSION Holdings’ R&D investment accounted for 3.31%, 2.99%, and 3.14% of operating income in the same period, respectively. During the same period, Xiaomi’s research and development expenses accounted for 3.07%, 2.75%, and 3.3% of revenue, respectively. In 2019, Transsion’s R&D investment is about 800 million yuan, and Xiaomi’s is 7 billion yuan. According to the comparison of data, Transsion’s existing patented technology and R&D investment are obviously insufficient.
The history of the collapse of the Bird mobile phone in 2006 is not far away. For Transsion to gain a firm foothold in the competition with the mobile phone giants, technological innovation must keep pace.
In the face of shock, what else can Transsion fight for? In fact, although TRANSSION's technological strength lags behind its peers, TRANSSION has been deeply involved in the African market for many years. TRANSSION has built its own solid barriers in software strength, regional advantages, and sales channels.
first at the software level , the African version of "NetEase Cloud Music" boomplay has already occupied the first place in African streaming music.Software such as the African version of Douyin Vskit, news aggregation Scooper, online reading Ficool, and the browser Phoenix Browser have deeply integrated the African market. These "soft armors" may be the strongest fortress of TRANSSION, and it may not be easy to pierce them.
The channel advantage established by Transsion is the biggest weapon against other brands . The company has established a relatively smooth sales network in these underdeveloped markets by upgrading and transforming the informationization of its distribution stores at all levels. Through the background real-time monitoring, regular analysis, advance forecasting, etc. to maintain continuous attention to the distribution network and market changes, a unique barrier to entry has been formed.
Ethiopia is the first company in the history of Ethiopia to export foreign exchange products. More than that, Transsion pays great attention to uniting local people, reusing local employees, and providing a lot of job opportunities in Africa. Obviously, this makes it possible for Transsion to win more government support.
It’s unclear how long the crown of the "King of African Mobile Phones" can be worn in Africa, no matter how long it’s been the product’s design and the black design since 2007 Channel development, marketing layout and technological innovation are all remarkable.It has also truly brought scientific and technological benefits to the African people and left job opportunities to the local people. Some people say that Transsion represents a microcosm of China's overseas Internet companies, which has made Africa and also made itself.
On March 16, 2021, Shenzhen Transsion Holdings was approved to become the country's first domestic and foreign currency integrated capital pool pilot enterprise. TRANSSION currently covers more than 70 countries and its cross-border settlement volume in 2020 will exceed RMB 40 billion.
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