2003: Starting with Foreign Trade

Chapter 908 2018 Mobile Phone Plan

Li Nan knew the saying, "The squeaky wheel gets the grease."

The boss has so many resources at his disposal, and how he allocates and allocates them, except for strategically important locations, depends entirely on his mood.

Compared to other companies, Meizu is almost like an unwanted stepchild, and its position is probably only ahead of Leichi, which doesn't need much management. But the problem is that Leichi can make money, and who doesn't like a company that focuses on making money?

According to information he gathered last year, Leichi uses one-third of its annual net profit for research and development, one-third for shareholder dividends, and the remainder for replenishing working capital and rewarding employees.

This company, with around 4500 employees, is quite unusual in Beicang. Unlike the owner's other companies, it has no plans to go public and doesn't engage in any investments other than buying some money market funds.

They distribute profits as they see fit and spend them as they see fit, as if they're not going to work tomorrow. But it's precisely because of this attitude towards distributing profits that both shareholders and employees are very satisfied. Every time it's time to distribute profits, Beicang City Investment will happily say that if anyone needs any help, they can ask.

Previously, the Beicang government had actually wanted Leichi to expand further, since the city couldn't accommodate it all, they could expand to more remote towns. However, given Tan Jincheng's attitude of distributing money every year, they stopped mentioning it.

Anyway, the current scale is enough for Leichi's annual production capacity, and there is money to be made. Besides, the current economic environment is much worse than in previous years, so it's fine as it is.

Li Nan refused to leave and got what he wanted.

In his proposal, Tan Jincheng added several options. One was to collaborate with a well-known headphone brand to launch a customized headphone or Bluetooth speaker, which would be bundled with Meizu phones to enhance the audio experience.

Secondly, Tan Jincheng helped him make connections. Meizu is positioned for young people, and considering the playful nature of young users, they could collaborate with DJI.

Another option is to collaborate with Xiaomi's ecosystem to make the two compatible. However, this is a bit difficult, as Xiaomi is at a critical juncture in its IPO, and Redmi's sales are also very important. It is estimated that this will have to be postponed.

In addition, there are collaborations with some trendy brands, such as the Palace Museum cultural and creative products that have become very popular in the past two years, as well as collaborations with fast-moving consumer goods and lifestyle brands, such as group-buying machines that offer food delivery coupons, Didi Chuxing coupons, and exclusive benefits for Bilibili.

In addition, platforms such as QQ Music can also be partnered with to offer exclusive discounts on phone purchases.

"The advantage of cooperating with these platforms is that in addition to gaining more channels, you can also embed these software apps in Meizu phones."

Meizu's system has always been labeled as clean and ad-free. Huang Zhang insists on not having too many built-in apps and creating a clean system.

This approach is certainly correct and has earned a good reputation, but the problem is that budget phones don't make much profit to begin with. If they don't add more built-in apps, the cost simply can't be reduced.

By collaborating with various internet platforms, Meizu can also have a reason to add built-in apps to its Blue series, thereby reducing costs.

"Don't think there's anything wrong with doing this. From a user's perspective, I definitely prefer a phone without any ads, that's for sure. But cost reduction is also something we have to do. How to strike a balance is up to you."

Seeing that Li Nan looked hesitant, Tan Jincheng could only try to comfort him.

Given Meizu's size, it would be almost impossible to survive with zero ads. Huang Zhang's idea is not wrong, but it is somewhat too idealistic. From a business operation perspective, this is very difficult to do.

Furthermore, if you don't integrate your app with other manufacturers, you can't form a favorable cooperative relationship with them, which essentially marginalizes you.

There's nothing wrong with targeting a niche market, but in the process of modern operation, you can't isolate yourself. While competing, you also need to form perfect cooperative relationships.

"That makes sense, but striking a balance is a bit difficult. There can't be too many built-in apps, but there also can't be none."

"That's your problem. I only care about the results. Also, we can cooperate with some universities offline. Meizu's main target is young people, so let's go into the campuses. I don't need to explain the plan, right?"

"Another point is to avoid competing with brands like OV, Huami, and Xiaomi to create differentiation."

"Of course, the most important thing is to ensure the quality of the product, that the hardware is commensurate with the price-performance ratio, and that the system is smooth. These are the most fundamental aspects. In the market for phones priced around 1,000 yuan, the price-performance ratio is the most important factor."

Back when Apple still held a dominant position in the high-end market, Android phones had one characteristic: they depreciated extremely quickly. Some models could lose 1000 yuan just by activating them. However, things have improved a lot in the last two years.

In the market for low-end models like budget phones, there isn't much room for price reductions. However, that doesn't mean you can be worry-free. Whether the phone lags or not, and how long it will lag to the point of becoming unbearable, are the most important things to consider when choosing a budget phone.

"Most users of budget phones are concerned about system smoothness, normal photo quality, and being able to play most games on the market without lag. In fact, with the current configuration, this is basically achievable."

In an era where mobile phone manufacturers are frantically pushing specifications, most mobile phones have actually become performance-overkill. While many users do have a high demand for high-performance phones, Tan Jincheng believes that most users' needs can be met by phones priced under 3000 yuan.

Playing mini-games, taking photos, making video calls, browsing short videos and other social media apps, as well as everyday life operations like mobile payments and shopping—these basically cover most people's usage scenarios.

With its positioning as a budget-friendly phone, Meizu can achieve these basic application scenarios by optimizing the system and adapting the hardware and software.

"Yes, that is something we should definitely pay attention to. We will strive to match Wei's product capabilities."

Li Nan nodded and said that over the past year, Tan Jincheng had invited many of Meizu's middle and senior management to visit Weilai Automobile and experience the standards and requirements of Weilai Automobile in the manufacturing process. Li Yan even spent nearly half of her time in Beicang.

The production standards of the mobile phone and automobile industries are certainly very different, but no matter which industry it is, making good products is a universal principle. The fact that Weilai's products sell well and have a good reputation means that Meizu has something to learn from them.

To be honest, Tan Jincheng has used Meizu phones before. They certainly have some amazing features, but they also have quite a few minor flaws. In terms of quality control, they are comparable to Xiaomi phones from earlier periods.

Li Nan stayed in Ningbo for half a month, and even after New Year's Day, he still had no intention of going back.

Meizu wasn't exactly a popular player in the capital market or the internet industry. Huang Zhang's frequent resignations and comebacks left major manufacturers confused, unsure whether to pursue deeper cooperation or not.

Therefore, Meizu is relatively weak in both online and offline channels. If the concert-style marketing in 2016 was a joke, it was also a helpless move. This was the fastest and best way for them to integrate online and offline channels.

In 2017, Meizu shipped 1725 million Meizu Blue and 352 million Meizu series units, for a total of 2077 million units. This was Meizu's performance in 2017, a decline of nearly 10% compared to 2016.

Compared to the total sales of 4.91 million units in 2017, Meizu's market share was 4.23%, which is a huge gap compared to OPPO, Vivo, Xiaomi, Huawei, and Apple. It was more than 3000 million units behind Xiaomi, which ranked fifth.

The top five companies have a significant lead, but Meizu still leads the seventh-ranked company by nearly 600 million units, so the gap between the two is still quite large.

"That's enough, you can go back to Zhushi now. I've contacted almost everything I needed to for you, why are you staying here every day?"

Tan Jincheng was also somewhat helpless. It's true what they say, you have to be humble when you're close to someone. Once you get to know them, they can be shameless and you really can't do anything about them. They're so busy at the end of the year, but there's nothing you can do. Li Nan just won't leave.

Besides helping him make the necessary connections for the cooperation plans they discussed, Tan Jincheng also took advantage of other opportunities, such as reaching a cooperation agreement with SF Express for delivery and listing Meizu and Meilan series products in the Weilai APP store.

In addition to these, he even latched onto Zhang Xupeng and collaborated with the Flash Group, offering discount coupons for Meizu Blue series cars with the purchase of Flash electric vehicles, and also wanted to cooperate with Flash in export trade.

Jinyi Industrial, a wholly-owned subsidiary of Flashpoint, is now considered a veteran in import and export trade. It has previously engaged in the import and export business of 3C accessories and has certain resources in the mobile phone sector.

Anyway, this guy is like a persistent leech; he'll try to take advantage of any opportunity he gets.

In the past two weeks, this guy has been seen in Beicang Tan Jincheng's business or in his business partners who are closely related to his business. He even approached Leichi for cooperation, but was rejected by Leichi's representative.

Tan Jincheng also laughed at him, saying that he was grasping at straws in his desperation. "You're a brand that mainly targets young people, and you're collaborating with a company that provides entertainment for the elderly? What kind of abstract idea is this?"

What, do you want the old folks to use their retirement savings to buy a mobile phone for their grandson while they're buying an old man's car?
"I'm under a lot of pressure too. I have to keep the promises I made."

After the Double 12 live stream, Meizu was basically certain that its sales would decline this year and that it would not be able to maintain a 5% market share. As a result, the group collectively stated that it would strive to increase its market share to 5% or even more in 2018.

Given that mobile phone shipments may decline further next year, the pressure to maintain a 5% market share will be even greater.

This pressure was passed on to Li Nan. He had no choice but to be so shameless, since Meizu originally had too few resources.

And what about your own boss? He has money, people, and resources. If you don't stick around him now and ask for more, you won't have such a good opportunity in the future. In fact, it might be difficult to see your boss as easily as you do now after the New Year.

Everyone knows that bosses have a tradition of causing trouble at the beginning of the year.

Although I felt a little embarrassed spending half a month in Beicang, I still gained a lot.

Li Nan even considered trying to curry favor with Tan Jinyue and get this little princess to take him to her brother's office, but unfortunately the girl was too shrewd and he couldn't fool her at all.

Thirteen-year-old Tan Jinyue is no longer the little kid who could be attracted by a piece of candy in the Flash Chi employee cafeteria. Tan Jincheng's two children, seven-year-old Tan Jinchuan and two-year-old Tan Jinqin, are also their aunt's little shadows. It's impossible to fool these three.

After entering junior high school, Tan Jincheng began to consciously cultivate his younger sister's business abilities. Unless she herself was unwilling in the future, she was determined to work for one of Tan Jincheng's companies.

The original plan included studying abroad, but after thinking about it, we decided against it. The study abroad community is too complicated, and if she really wants to go abroad, we'll have to wait until she graduates from university.

If she intends to travel abroad after she grows up, Tan Jincheng wouldn't mind. After all, she's an adult with her own way of thinking, and you can't stop her even if you want to.

The same applies to a son and a daughter; before their values ​​are truly formed, they don't place too much importance on them.

For Li Nan, the two weeks he spent in Beicang were worthwhile. Meizu itself had too few resources, so he had to use this method to ask his boss for resources. This time, apart from the compatibility with Xiaomi, which was not agreed upon, he got almost everything else.

QQ Music, NetEase Cloud Music, Meituan, Didi, and Bilibili are all available. In terms of gaming resources, there's TiMi Studio from Orange Group and miHoYo. As for collaborations with headphone manufacturers, Tan Jincheng doesn't need to get involved.

Meizu started out making MP3 players, so its resources in this area are stronger than those of Tan Jincheng.

"Alright, since you haven't left yet, please inform General Manager Chen and General Manager Bai that we need to have a meeting."

Tan Jincheng was also helpless. He was currently in talks with Didi about cooperation and didn't have much time to deal with Li Nan. He needed to arrange work for them so that he could return to Zhuhai as soon as possible.

Didi wants to commission Wei to develop a new energy vehicle, internally codenamed D1, for use as a self-operated ride-hailing vehicle.

In 2017, the ride-hailing market expanded again. Feeling the pressure of direct procurement, Didi decided to cooperate with automakers such as Wynn, BYD, Volkswagen, and BAIC, planning to optimize its ride-hailing service through customized models.

With its shareholder status and advantages in open technology platforms and new energy technologies, Weilai has become Didi's first deep partner. Recently, the two parties are preparing to begin in-depth discussions on cooperation models. If the cooperation is successful, it will serve as a springboard for Weilai to enter the global market, as Didi's business extends far beyond China.

The two rounds of ride-hailing wars, especially the second round against Uber, were mainly fought in China, but Didi also blocked Uber around the world.

By acquiring Uber's biggest competitor in the North American market and expanding into Southeast Asia, South America, and Australia, Didi's business now covers 15 countries worldwide.

In countries like Brazil and other small towns, Didi's business is performing quite well. If this cooperation can be carried out, then Weilai can be said to have increased its chances of going global by leveraging Didi's business channels.

"Okay, I'll go and inform them right away."

Li Nan scurried out. Everything needs to be done in moderation. For the past two weeks, he had been hanging around his boss and occasionally acted as his secretary. It was clear that his boss was very busy. Now that he had gotten what he wanted, he couldn't keep bothering his boss.

Li Nan and Li Yan were both in Beicang, and they came over with just one phone call. Li Yan, who had been in Beicang for more than half a year, was already considering establishing an Flmye branch in Beicang next year, moving most of the vehicle infotainment system R&D to Beicang, which would make communication easier.

"Hey, I was just thinking of talking to the boss about this, and then he called us to a meeting."

Upon hearing Li Nan's announcement of the meeting, Li Yan chuckled.

Li Nan sighed softly, somewhat resentfully, "You're having a good time. Out of all of us, you have the most contact with the boss and your position is the most secure."

"What nonsense are you talking about? The boss treats everyone the same. Otherwise, if you were the boss, would you put up with your persistent nagging for half a month? Just do your job well."

Li Yan laughed and scolded. In fact, through Li Nan's performance over the past two weeks, he had figured out that the boss did not intend to give up on the mobile phone business. He not only personally went live, but also provided so many resources.

In the past two weeks, the boss has spent a lot of time and effort on favors, such as contacting Tencent, NetEase, Bilibili, and miHoYo. He personally called them all to inquire about their collaborations. Normally, even if they had changed owners, it would be quite difficult for them to reach these agreements, and it would take at least a long time.

Unlike traditional industries, the internet industry is not aloof and independent. Even a junior employee can ignore you. The ability to quickly finalize contracts and plans can only be due to instructions from the highest level.

If the boss really didn't value this, would he have spent so many favors on him?

"Everyone's here, right?"

"Everyone's here, and the equipment in the conference room is all set up. We can start the meeting now."

For the past two weeks, Li Nan, who has occasionally acted as an assistant, has done a pretty good job in arranging meetings. She can arrange everything without you having to say much, and the meeting room is almost ready.

"Sure, you've got some skills. With a little more practice, you could be a great administrator. Would you like to consider it?"

"No problem, it would be even better if I could be the boss's administrative secretary."

"Alright, enough joking around, let's begin."

Two people were present at the meeting. Li Nan took the initiative to take the task of taking meeting minutes. In addition to the two of them, several senior executives in Zhuhai, including Chen Mingyong and Bai Yongxiang, participated in the meeting via video link.

"Alright, let's start the meeting. Mr. Li has been pestering me for half a month and has spent a lot of resources on me. You can decide how to allocate them yourselves. Also, I'll go over the work plan for 2018."

"Before discussing next year's work plan, let's summarize this year's work. Everyone did a great job overall, and everyone will receive the rewards they deserve. Just have the compensation committee make the plan and submit it for approval."

If you want a horse to run, you have to feed it. Meizu is still operating at a loss and is not yet listed, so the so-called equity is actually useless. Tan Jincheng, or rather, the major shareholder of ByteDance, still has to continue to subsidize the company.

“I don’t care about Meizu’s profit requirements. To put it bluntly, if you can keep the losses within 10 billion yuan, I’ll subsidize you for 10 years without any problem. But since you’ve asked for so many resources, you have to produce some results.”

"So I have a requirement for you: achieve profitability in the 2020 fiscal year. Is that a problem? Then we can also push forward with our IPO plan."

CEO Chen Mingyong on the other end of the video smiled and said, "No problem. The boss is already being very lenient by giving us four years. If we can't make a profit in four years, then I will resign."

"No one is asking you to resign. You can understand this as a long-term plan for going public. Of course, if you can achieve profitability as soon as possible, we can also go public sooner."

"Let me also talk about the two brands. Meizu focuses on the mainstream mid-to-high-end market, which is self-evident. Since it's mid-to-high-end, the brand image has to be high. We achieved good results this year, and we hope to continue our efforts next year."

In a year of dramatic changes and overall sales decline in the mobile phone industry, Meizu's ability to maintain sales, especially the Meizu Pro 7 series which maintained sales of over 350 million units, is quite remarkable.

Meizu's decline began with the Pro 7 series, which can be considered the most unsuccessful flagship model in Meizu's history. Even without memories of the past, Tan Jincheng, who had seen the design drawings and plans, knew that this was a rather unsuccessful phone.

Leaving aside the rear screen, which is essentially useless, you could argue it's a selling point, since aesthetics are subjective.

However, the hardware configuration is really terrible. It insists on using MediaTek chips, but MediaTek has been really terrible in recent years. The so-called ten-core chip has been criticized as having one core struggling while the other nine are just watching.

The processor's performance is simply not up to the task of supporting a flagship model. In addition, the design of the rear screen forces the Pro 7 to sacrifice many basic functions such as NFC, which is really unacceptable for a flagship device.

In addition, regarding the screen design, although it uses a relatively high-end AMOLED screen and is planned to be purchased from Samsung, the 5.2-inch screen seems a bit small. Nowadays, mainstream models use 5.9-inch screens, or at least 5.6 or 5.7-inch screens.

The processor is subpar, the screen is subpar, and many basic functions are missing. This machine, which can barely be considered a mid-range model, has a starting price of 3000 yuan, with high-end versions even exceeding 4000 yuan. It would be a miracle if the market could accept it.

Flagship phones are all about configuration. Apart from Huawei, the entire Android system can't produce high-end chips from Qualcomm or Samsung, so they can't be called high-end models at all. Trying to sell them for more than 3000 yuan is practically suicide.

For this reason, Tan Jincheng overturned the original design and quickly reached a settlement with Qualcomm, showing sincerity in order to successfully secure the first launch of the Snapdragon 835. With the support of this amazing chip, the Meizu Pro 7 series became a completely different story.

Although BOE's screens are also criticized, Meizu suffers less criticism because Huawei is taking the lead. Besides, BOE's screen yield rate is quite good nowadays.

A few years ago, it would have been a bit risky for Meizu to use BOE screens.

"Next year, I hope Meizu can continue to maintain a certain level of growth. I agree with the 5% market share target set by everyone, and achieving 5% market share will be crucial for Meizu's sales."

"In addition, I would like to say a few more words about the Meizu brand."

Li Nan, who had been diligently taking meeting minutes, couldn't help but look up.

"Although the Meizu brand claims to target the youth market, it actually focuses on the low-end market. However, low-end does not mean low quality. I hope Meizu can further improve its quality control next year."

Meizu's current problem is still in quality control. This year, all of its products have used Qualcomm chips, and in terms of processors alone, they are still very competitive in the market. This is also a significant highlight and topic of discussion for Meizu this year.

As a die-hard MediaTek fan, after being betrayed by MediaTek last year, Mr. Tan took over and immediately used a MediaTek chip. In the eyes of his competitors, this was a bit impulsive and increased the cost of the phone, but in the eyes of mobile phone enthusiasts, it had a sense of vindication.

Meizu's total shipments this year exceeded 1500 million units. According to the agreement reached with Qualcomm, the cooperation model will continue for another two years when Meizu's total sales exceed 1500 million units.

From 2017 to 2019, Meizu will no longer use MediaTek chips. As for the future cooperation model, both companies will definitely use them, but it will depend on the performance of the negotiations between the two parties.

"Another point is that we need to purchase more chips this year, including some from MediaTek. We can use other companies' names for this, and I will cooperate with you on this point."

"Huh? Why?"

"Don't ask why yet. There must be a reason. You'll find out when the time comes."

The two sides are expected to start feuding around the second half of the year. At present, the old man is relatively stable. Although there have been some frictions between the two sides, no one would have thought that their relationship would deteriorate to such an extent.

For a long time, many domestic companies were completely unprepared, because this wasn't the first time trade frictions had occurred, and they were always resolved through negotiations. No one expected this time to be so serious.

Tan Jincheng couldn't say much before it started, so he could only make some preparations to deal with any trouble that might arise.

"Another point is that everyone should have noticed that mobile phones are getting more and more expensive. The price increase of 500 yuan for the Xiaomi 6 this year is a clear signal. In the future, it may become the norm for mobile phones to become more and more expensive."

"Most manufacturers might even abandon the sub-1000 yuan market altogether, but I hope Meizu will persevere, even if it doesn't make money."

"Li Nan, you can send a research team to investigate this matter across the country, to see what the needs of elderly people or left-behind children in remote areas are for mobile phones, and to produce some smartphones priced around 500 yuan based on their actual usage scenarios."

Li Nan pondered: "Should companies also shoulder some social responsibility when they make money?"

"Yes, but you shouldn't publicize this. Let's just do it quietly and not let a good thing turn into a bad thing."

According to Tan Jincheng's understanding, even after 2020, many elderly people left behind in rural areas were still using feature phones. Smartphones are more complicated than feature phones and are not easy for the elderly to use, but the fundamental reason is that they are too expensive.

Producing a simple and easy-to-use smartphone priced around 500 yuan to meet their daily needs for video chatting and calling their sons and daughters who work away from home, and for watching short videos, can be considered a good deed.

"Okay, I understand. The boss has a problem with my marketing approach."

"Haha, I have no objection. I don't care if you use that approach on your competitors, since you're all just hurling insults at each other anyway, and you'll always stab each other in the back when something happens. But you can't use this method on consumers."

"You must pay attention to this. The economic situation is not as good as before, and users are much more sensitive. Don't do anything that provokes users. Try to avoid things like riding the wave of popularity. We should just be ourselves."

Last year, Li Nan frantically tried to gain attention and frequently stirred up controversy, which led to a barrage of criticism from netizens. Given Meizu's situation last year, Tan Jincheng couldn't say much, but he still had some authority on marketing. It would be best if such abnormal marketing methods were not used again in the future.

"Haha, okay, I've learned a lot from the boss these past two weeks, and I'll pay more attention to that this year."

In the past two weeks, Li Nan did discuss some marketing methods with Tan Jincheng. It's no exaggeration to say that he learned something. He also summarized Tan Jincheng's marketing methods: there are some unconventional tactics, but they definitely won't cross the line; most of them are upright and honest.

"A good marketing model must address user pain points, not be achieved by attacking competitors."

(End of this chapter)