Hisense is one of the fastest growing consumer electronics brand globally and matches its ambition with cutting edge technology, future ready design and an intrinsic desire to excel. People remain at the fulcrum of realising the Hisense brand vision and none more so than Fazalur Rahman, Marketing Director, M East. Here, in a freewheeling chat with BrandKnew he articulates the myriad opportunities and challenges that the brand encounters as they collectively forge ahead as an organisation to attain global benchmarks.
BrandKnew (BK). You have huge amount of consumer electronics industry experience – what attracted you to this industry and also to Hisense?
I joined Hisense about 6 months back. Earlier, I worked in Samsung Electronics for 8 years. Prior to working in Samsung, I worked for LG. My career path has been either in Advertising Agencies or with the Consumer Electronics brands. A career in Consumer Electronics is a natural career path for me. Building strong marketing plans for Consumer Electronics Companies has always been exciting for me.
I decided to join Hisense after working for Consumer Electronics Industry leaders; which could be surprising. But, I took this decision, as Industry leaders have come to a matured stage of their trajectory in terms of brand recall and various marketing KPIs, viz, market shares, visibility, awareness etc. As a marketer, there are not much for me to do with the Industry Leaders and there are not many marketing challenges which excite me there.
In last several years, we have been witnessing a significant growth of Chinese companies like Hisense, Huawei, Lenovo etc. globally. The acceptance levels of various Chinese High end products have also been increasing in the last several years.
I found Hisense to be a company with great potential. Hisense have a good base in terms of production globally. Hisense started investing in a lot of global branding platforms like being UEFA Euro 2016 Global sponsor, sponsoring Australian Open, being official television supplier of the 2015 Formula 1 Rolex Australian Grand Prix etc. So, there is a very good intent from the senior management to build the brand globally. I found potential and intention to grow, which suits me very well and thus I decided to join Hisense.
BK. What is the overall CE market size of the Middle East market? And what kind of market share would the Hisense brand be commanding from that pie?
Total market size of Televisions in the Middle East Market will be around 2.5 – 2.6 billion Dollars. If we consider other categories also like Refrigerators, Washing Machines etc., the Market share will 4.4 – 4.5 billion dollars. Hisense Middle East established itself 3-4 years back in GCC and Levant Market.
We were able to achieve a good growth in the market-share in this market. We now have 5.5-6% market share in this market. Achieving the same in a span of 3 years is definitely good, according to me. With the marketing plans we have formulated to promote Hisense globally in the coming years, I am confident that the market share of Hisense is going to improve significantly, in GCC as well as globally.
A lot of work is being done in R&D of Hisense – we have started investing more than 5% of Revenue in R&D. We have R&D centres globally. The kind of products started coming from last year’s CES have received tremendous acceptance in the market.
As a matter of fact, in some of the global markets, like South Africa, we are number 1 in the case of TVs. In Australian market – we are number 1 in refrigerators, beating all other brands. So, we have at present good product acceptance both in the region and globally. And going forward, I think that we have a strong case to establish ourselves as a big brand in the region and globally as well.
BK. Slowdown and currency devaluations were some of the events that hit the white goods industry in 2015. Has the industry come out of that situation?
Unlike Asia and Europe, Consumer Electronics industry in GCC countries didn’t experience a steep decline. There was a negative growth in this industry for sure. The industry in Oil economies like Saudi Arabia definitely suffered. But, it didn’t significantly affect the Consumer Electronics Industry in GCC countries, especially in UAE, the trend setter in GCC countries. The figures are now getting better, especially in UAE. The Consumer confidence is growing as was evident from their responses in Gitex Shopper & Big 5 – the trade shows recently conducted in Dubai etc.
BK. Over the last few years, the focus at Hisense changed to a great emphasis on making well designed products that was also at the forefront of technology – what prompted that thinking and when you look back, how do you evaluate the success/progress made?
The work done in last 2 years in Hisense in the technology – front, R&D, Marketing front etc. clearly indicates the intention of the company to become a key global player. The investment in R&D in Hisense has been significantly increased and we have opened R&D centres worldwide in last few years. Globally, we have started increasing our footprint.
We recently acquired Sharp America’s TV Business and gained rights to the Sharp Brand in North and South America. Our next target is to become number 3rd or 4th brand globally in the product categories we are in. We are already number 3 in TVs. Our expansion plan is now to focus on GCC countries’ market, other than UAE, where we are already established. I think that the success/progress we made in the last few years is excellent.
BK. This market is very tactical, discount and price conscious. How has it affected Hisense’s brand building strategy?
We focus on the medium or upper segment of this market – in which the consumers are educated, appreciate good quality products with good features and latest specifications – and we are able to provide the same at a very reasonable cost. We focus on building our brand at the retail level, which is very crucial. We target the price conscious segment, which is not very big, by providing tactical offers during Ramadan, DSF, DSS etc.
BK. Market and consumer dynamics are changing ever so rapidly with the confluence of technology, social media, digital eco systems etc. How does the Hisense brand stay on top of these tectonic shifts and leverage the positives emerging from such an environment?
Communication platforms in last 2-3 years have emerged a lot. At Hisense, we realise the strengths of digital marketing channels and have incorporated them in our communication mix. We consider digital marketing of Hisense in GCC countries as important as internet penetration is one of the highest in this region. But, at the same time, our basic approach is to strengthen retail branding.
BK. Which is Hisense’s flagship model amongst all your product verticals that sells the most in the GCC? What do you attribute that to?
Our most successful and flagship model is K7 100 TV series which is ULED and has a very high resolution. This model is rated very high by various global agencies, including Cnet. It is 4K, has HDR, Netflix, screen mirroring – mirroring content on the mobile, has curved and non-curved versions, is Wi-Fi enabled, is very thin and hugely popular. We launched it 6-7 months back and the response is tremendous. We attribute this success to our strength in R&D.
BK. In Hisense’s marketing mix, which media takes dominance and do you base it on consumer/market insights, emerging media & market dynamics, past sales data or anything else?
As an emerging brand, we presently focus on retail branding, digital marketing channels and print media. We do consider consumer/market insights, localised research, focus groups etc. while deciding the right marketing mix suitable for us.
BK. In terms of brand recall for Hisense in this market, where would you place the brand on a scale of 1 to 10 vis a vis being in the consideration mind set?
After we have done heavy branding investment in Euro cup, Australian open, Formula one etc., the brand reception, brand recall and awareness of Hisense have significantly improved. After Euro cup, the Brand recall of Hisense was increased by 6%. Brand Recall of Hisense definitely increased in this region also, as Soccer has a huge fan following here. At present, I will place Hisense on a scale of 7-8; but our target is to be one of the top 3 brands in the recent future and by then we would have reached 9 in this scale.
BK. How does the Hisense brand out think the competition from heavyweights – be it Samsung, Apple, Lenovo, Panasonic, Sony etc. – is it through product leadership, marketing, customer orientation, service, product mix or pricing?
One great advantage of Hisense is that it is an ideal mix of product and price. We provide a world class product at a great price as compared to the established brands.
We are able to reduce the price due to economies of scale and also our production process is such that we can cut down a lot of expenses – still being able to deliver a great product. Also, our branding investments pay off and our operating expenses as compared to the established players in the market is far less.
BK. In the coming years, what are the new models that we can expect from Hisense? Are you launching anything new at the 2017 CES in January in Las Vegas?
We can disclose the products to be launched in CES only in the press conference later this year in Las Vegas. But, recently, in Gitex, we introduced 8K TV, which is unique in the market & Laser cast TV as well.
In big 5, we launched Wi-Fi enabled A/c – which one can control through a smart phone app. The Hisense smart phone app can be connected to Hisense refrigerators, TVs and A/Cs to operate them.
We are also working towards IoT – so as to integrate various devices to provide a seamless experience to users.
BK. Driverless cars, IoT, Omni Channel Marketing, Virtual Reality Showrooms, the Uberisation of the world etc. etc. – where do you see the consumer electronics industry headed in say 5 years’ time?
With IoT, we will be able to smartly manage Refrigerators, Washing Machines etc., through our smart phones. With the aid of a camera installed in a Refrigerator, one will be able to see the inside of a refrigerator while they shop grocery – to check what are all not there in the refrigerator, using their smart phones.
And I think a key development in IoT would be to introduce a global platform – where different products of various companies could be integrated; work has already been started in this direction. There will be more smarter devices like Audio devices customizing themselves based on individuals’ ears.
We will be able to do all our financial transactions from our TV connected to WIFI. Also, a revolution in the storage capacity of devices like TVs and Mobiles are going to happen.
BK. As we wind down, could you please share what you love pursuing in your (limited) spare time?
I love to spend time with my family. I love to go to different countries on short vacations. I like to go for long drives, go to beaches etc. I like to listen to ghazals (a type of Music). These days, it is really difficult to find spare time to do what we love to pursue, outside our career. But, it is important to manage our time effectively to find time to do things we love, to balance work and life.
Interview conducted and written by Sreejish Lal, Digital Marketing Advisor @ ISD Global
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