Dubai: Huawei, the world’s third-largest smartphone manufacturer, has invested heavily in establishing Honor as an e-brand in bid to lure the digitally savvy consumers and beat competition from other online-only Chinese makers.
The company has a simple business model and that is to reduce its operating costs by becoming an e-brand.
“The cost-savings are used to sell high-end specs and features to consumers at an affordable price. The online model cuts marketing spending and commissions to distributors. That savings are passed on to consumers and they benefit,” Chris Sun, vice-president of online sales at Huawei Middle East, told Gulf News.
He said the company’s intention is to maintain a reasonable profit margin and that is the principle of both Huawei and Huawei Honor. Consumers save around 50 per cent from online buying.
The company, even though established last year, is only four months old in the UAE and has launched two models — Honor 6 Plus and Honor 4X.
He said the sales, so far, has been beyond its expectations, but he did not reveal how many units sold.
He said that Honor already contributes more than 45 per cent to Huawei’s total global sales.
Huawei is aiming to become the first Chinese company to sell more than 100 million phones this year.
“The repurchase and referral purchase of the brand is very high and is more than 95 per cent globally,” Sun said.
“We will have our own e-commerce site — both Arabic and English versions — by [the] end of October. Right now the phones are sold through Souq.com,” he said.
He said that despite the stiff competition in China, Honor has already sold 20 million units globally in the first half of this year or the same number of phones it sold for whole of last year.
“We have already made more than $2.6 billion [Dh9.54 billion] in revenues globally and our intention is to make more than $5 billion by selling 40 million units globally this year,” he said.
The brand is already present in 75 countries and plans to enter South America.
“We are present in all the major markets and our goal is to strengthen the existing market presence rather than continue expansion and become the number one brand,” he said.
The company is planning to launch its next smartphone with the fastest fingerprint scanner — Honor 7 — by end of October and the Honor X2 tablet later this year.
Sun said that major growth will come from smartphones and the Gulf is still a ‘potential region’ for growth.
“We are targeting 10 per cent of the online market share this year. Last year, the online sales of smartphones were four million units but there is no accurate forecast for this year,” he said.