Source: Ginkgo biloba Finance (ID: threemornings)
In 2018, it can be said that the situation is changing, as well as for the mobile phone industry. According to IDC data, global smartphone shipments fell by 4.1% in 2018. Under such circumstances, mobile phone companies rely on stock competition, survival is quite difficult, these enterprises collapsed, bankruptcy, silent no longer. Jinli, Hammer and Lexus mobile phones have completely collapsed, 360 mobile phones only have the last breath, Meizu mobile phones also have a sense of gradual loss.
However, for almost all small and medium-sized mobile phone companies, the most frequently asked question in the past two years is how to think that global mobile phone sales have begun to focus on the head companies. They have a variety of self-justification or self-comfort answers, but they have been unable to resist such a trend.
Therefore, although overall mobile phone shipments are declining and many small and medium-sized mobile phone companies have fallen, many head companies have become stronger as a result. This year, Huawei, the world's third largest mobile phone manufacturer, increased its market share. Millet, the world's fourth largest mobile phone manufacturer, also increased its market share. Samsung, the first mobile phone manufacturer, and Apple, the second largest mobile phone manufacturer, were almost in place.
Millet sold 119 million smartphones in 2018, according to the latest earnings report released by Millet Group yesterday. With global mobile phone sales falling by 4.1%, millet mobile phone business is growing by 29.8% against the trend. It is a rare company in the industry that still maintains a sustained and high-speed growth.
In an open letter to investors, the founder of millet, Lei Jun, said that in 2018, millet revenue was 174.9 billion yuan, up 52.6% year-on-year, adjusted net profit was 8.6 billion yuan, up 59.5% year-on-year, exceeding market expectations.
Lei Jun said that behind the figures, millet successfully implemented a series of active adjustments, combing the nuclear strategy for the next five years, which is a more far-reaching key action. This is the most important achievement in 2018.
Lei Jun also mentioned in particular that for the mobile phone business, millet also successfully completed the brand combing in the fourth quarter of 2018, as well as the product structure, release rhythm of the initiative to adjust. Since the beginning of 2019, millet has been able to face the market with a brand new look and rhythm. It has successfully launched the independent multi-brand strategy of millet and Redmi brand, and released two brand-upgraded brand-new products with great success. Redmi Note 7 shipped more than 1 million units in less than a month, and the supply of the new flagship millet 9 series is expected to exceed 1.5 million units by the end of March.
Before the IPO of millet, Lei Jun promised consumers that the overall net profit margin of millet hardware would never exceed 5%. If it exceeded, it would return more than part of it to users. According to the latest earnings report of millet, the net profit margin of millet hardware after tax in 2018 is positive, and less than 1%.
Lei Jun said that this data eloquently proves that user interests and enterprise income can exist in harmony without opposition. In 2018, while the average price and profit of millet's mobile phone are both rising, millet can still adhere to the principle of cost pricing and make products with impressive prices.
Although this report does not disclose the sales data of millet and red rice Redmi, according to the historical data disclosed in the millet prospectus from 2015 to 2017, red rice Redmi generally accounts for between 75% and 80% of the total sales of millet smartphones. According to the total sales of millet smartphones in 2018, estimated at 119 million units, Redmi global sales are expected to be around 90 million to 95 million units. To be able to deliver 100 million units per year for a single brand, we have to say that the price-performance ratio advocated by millet has been recognized worldwide.
Especially in the Indian market with a population of more than 1 billion, millet smartphones (including millet phones and Red Rice Redmi phones) have ranked first in sales for many quarters in a row, with Samsung, Apple and Huawei being far behind.
According to Counterpoint, India's smartphone shipments in 2018 were about 145.2 million, up 10% from 132 million in 2017. According to the report, millet's market share increased from 19% in 2017 to 28% in 2018, 4% higher than the second Samsung. In 2018, sales of Samsung mobile phones in India increased by only 10% compared with the same period last year, while sales of Millet smartphones in India increased by 59.6% compared with the same period last year. Therefore, Millet successfully surpassed Samsung to become the annual sales champion in 2018.
And the attention of Huawei and glory combined, sales in India did not enter the top five, can be said to be left behind by millet.
In fact, millet India business is a microcosm of millet overseas business. If we compare the performance data carefully, we will find that overseas markets outside India are even much better than India. For example, the latest earnings report of millet shows that in 2018, the international market income of millet increased 118.1% to RMB 70 billion yuan, and the income share of millet group increased from 28.0% in 2017 to 40.0% in 2018.
According to Canalys, smartphone shipments in Indonesia rose 299.6% year-on-year in 2018, ranking second in terms of market share; smartphone shipments in Western Europe rose 415.2% year-on-year, ranking fourth in terms of market share. Thus, the growth rate of millet in Indonesia and Western Europe is several times faster than that in India.
Against this background, the last piece of Red Rice Redmi's anti-superglory jigsaw mostly lies in China, the world's largest smartphone market.
It has to be admitted that, relying on the powerful Huawei, the glory has made a leap forward in the past two years, even surpassing Red Rice Redmi in the domestic market.
However, if we go back to the development of glory, it also has a deep brand of millet.
It is precisely because this way of learning millet first and then relying on Huawei to grow and grow, that makes the sales of glory in the Chinese market increase greatly, which makes the head enterprises including millet, OV and so on feel pressure.
According to the above report, Red Rice Brand has become Redmi independently, and its target is Huawei's sub-brand glory. Since the first Red Rice mobile phone came out in 2013, Red Rice series mobile phones have sold more than 300 million in the world, which has been the leading glory in the global market. However, in China, it has not yet achieved anti-surpassing.
The Great Counterattack Begins
Redmi began its first press conference after the Spring Festival in 2019. It started with Lu Weibing's products that were not honours, but also ended with Lu Weibing's announcement that Redmi Note 7 Pro was far better than the glory V20.
One important factor in Huawei's glorious success is its good photography skills, which in some ways can even crush apples and Samsung easily. In the past, millet was not good at photography, but with the great investment of human and material resources in this field in 2018, its photography technology has been greatly improved.
Lei Jun once quipped at the launch meeting at the end of 2018 that whether the millet camera department has the year-end award at the end of the year depends on whether the photography technology of millet can surpass Huawei. According to Millet's latest financial report, the new flagship mobile phone Millet 9's rear camera DxOMark scored 107 points in February 2019, ranking the top three in the world when it was released. The video sub-item DxOMark score of Millet 9 was also as high as 99, which was higher than that of all smartphones at the time of release. It can be said that nowadays the photographic level of millet has the strength to fight with Huawei.
Based on the progress made in the photographic technology of millet, Lu Weibing stressed at the release meeting that the main subjects of Redmi Note 7 Pro are identical with those of Huawei Noa 4 and Glory V20. More importantly, Redmi, under the supervision of the notary office, filmed a contrast sample of Red Rice Note 7 Pro and Glory V20. During the shooting process, two mobile phones chose the same shooting angle, the same shooting mode and the same focus to shoot the same scene. They are almost comparable. But in terms of price, Redmi Note 7 Pro only costs 1599 yuan, and Glory V20 only costs 2999 yuan. In terms of cost performance, Redmi has obvious advantages.
Lu Weibing also said that if both prices were the same, glory would be crushed by Redmi. His implication is that Redmi's mobile phone, hardware and photography are almost the same as the glorious mobile phone, which costs 3,000 yuan. If we compare the Redmi mobile phone with the glorious mobile phone, won't it be a waste of time?
In the Redmi Declaration of Independence, Lu Weibing said that Redmi inherited the past of millet and red rice, to carry out high quality and cost-effective to the end. Therefore, Redmi is not only a thousand yuan machine, but also a high-end flagship mobile phone, even any high-quality and cost-effective products.
That is to say, after independence, Red Rice Redmi will no longer be constrained by pricing restrictions. In the future, don't be surprised if you see a Redmi phone that costs about 3,000 yuan. This may be the product that Lu Weibing's team is currently preparing.
Of course, according to Lu Weibing's plan to fight back against glory, Redmi is not only cost-effective, nor is it just a mobile phone, but a complete set of combined boxing. In fact, at the Redmi announcement of Note 7 Pro on Monday, Lu Weibing also released eco-chain products, including Redmi full-automatic wave washing machine, Redmi headphones and so on.
Although millet also has eco-chain products, it does not cover all sub-areas. Red rice as an eco-chain is a complement and sink to millet eco-chain through the way of extreme cost-effectiveness. For example, in emerging markets such as India and Indonesia, consumers can not afford high-price eco-chain products like those in China and the European and American markets, so they can play a good role in these markets.
The Chinese market is the last and largest jigsaw puzzle of Red Rice Redmi's anti-superglory. It's hard to say that the victory has been locked in at present. But from the fact that the first Red Rice product Note 7 has shipped more than 1 million units in less than one month, this is a good start indeed.