Honor sees HK as bridgehead for future

Honor, one of the twin pillar smartphone brands owned by Huawei Technologies, is looking to make Hong Kong its offshore marketing center, as its strives to build its global presence.

The Chinese mainland brand, whose cost-effective smartphone handsets target tech-savvy and trendy young consumers, has yet to launch sales in Hong Kong, but it plans to make inroads into the financial hub very soon, George Zhao Ming, president of Honor, said in a recent interview with China Daily in Hong Kong.

"In the coming few years, Honor will focus on making a name for itself in the city, taking advantage of Hong Kong's strong influence over the Asia-Pacific region and its immense pool of talent," Zhao said.

The Honor brand, now available in 74 countries and regions since it was launched and began operating as an independent operation in 2013, remains on track to become the No 5 smartphone maker globally and generate half of its sales from overseas by 2020.

Today, major offshore markets like Western Europe and India are dominated by a trio of smartphone giants－Apple, Samsung and Huawei. Other brands including Honor are competing for fourth place, Zhao said.

In Russia, Honor has been the top three brand in sales volume for 12 consecutive months and secured second place recently. In France, it has become the top four brand in revenue and top five in sales volume.

The Chinese brand is also the fastest growing smartphone vendor in India, with a 300-percent increase in sales volume and revenue over the first half of this year. The company is now looking at prospects in Southeast Asia this year, in its quest for a new growth engine.

In 2018, Zhao projected foreign markets will contribute to 25 percent of total sales. This comes after overseas sales accounted for 15 percent of the brand's sales last year.

Honor primarily focuses on millennials and people in pursuit of young lifestyle, Zhao noted.

"Honor was born as an internet brand, known for its heavy reliance on the internet to reach out to young people in the most efficient way," he said.

The smartphone maker jumped on the offline sales bandwagon in 2015. Sales from brick-and-mortar stores, which are run by the third-party vendors through partnerships, make up nearly 50 percent of the brand's sales.

Its business model is built on being able to offer its flagship model phones at much more affordable and competitive prices in a "light-asset" manner, which means spending smartly on marketing and channel management to cut down on costs.

Such a strategy will be replicated in Hong Kong, where the company plans to steer clear of splurging on outdoor advertising but instead touting for business via less expensive online advertisements, Zhao noted.

The company launched its Honor 10 in the United Kingdom in May. The flagship new model, known for an AI-powered dual-lens camera and 3D glass body, comes with a starting price of 399.99 pounds ($525), cheaper than the premier phones sold by Apple, Samsung and Huawei in the country.

But Zhao reiterated that the price tag is not the selling point of Honor.

"Young consumers have their own unique understanding of the value of the products, which cannot be simply explained as a bargain price," Zhao noted. "All in all, it is the product itself that helps us win and retain customers in the race with Apple and Samsung worldwide."