Topic Huawei E-commerce Strategy Analysis - Essay Example

In the coming years, those E-commerce dealers gained benefit by China high economic increasing and internet development and grown into very famous huge enterprise. Taboo, Jingling are the typical firms. For E-commerce, the basic condition is internet development. Since 2000 internet bubble was broken, but the DNA of internet was inherited in China. Not only in China, actually, during 2007 to 201 2, is Asia Internet user growth very faster. (Firmly &firm2) Internet has changed people’s life style and habit. In the end of 2012. From CONIC report, the internet penetration rate reached 42. % In China, rising 3. 8% over the previous year. The growth extent further contracted compared with the last year. Mobile phone Internet users hit 420 million, growing at the annual rate of 18. 1%. By the end of December 2012, China has had a total of 309 lion microbiology users, an increase of 58. 73 million. Of the internet users, microbiology users accounted for 54. 7%, up by 6% over the end of last year. A considerable number of users accessed microbiology and published microcosms Vela mobile phones. By the end of 201 2, the mobile phone microbiology users has hit 202 million, namely 65. % of microbiology users used their mobile phones to access microbiology. By the end of December 2012, China has had a total of 242 million online shoppers, and the utilization ratio of online shopping rose to 42. 9%. Compared with 2011, online shoppers grew by 48. 07 million at a rate of 24. 8%. E-commerce applications witnessed fast development In the field of mobile phone terminal, growing In an all- sided manner. Compared with 201 1, the proportion of mobile phone Internet users shopping online via mobile phones grew by 6. 6%, and the total number was 2. 36 times as great as that at the end of last year.

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In addition, the proportion of mobile phone group shopping users in the total number of mobile phone Internet users went up 1. 7% over the end of last year, that of mobile phone online payment up 4. 6%, and that of mobile phone online banking up 4. 7%. The users of the three mobile applications all grew by more than 80%. Serge Hoffmann, Bruno Lanes and Jessica China E-commerce is to expected to reach ARM 1. 5TH in the end of 2013. The market is driven by BBC. (Form). There are is no doubt that China will be the biggest e- commerce market in the future. They claimed.

Even currently the market share of E- commerce is still low, but the growth is very faster. Firmly : Share of Internet population Growth Firm: China Internet User Development Form: China E-commerce market forecast Firm: China E-commerce growth forecast 1. 2 Hawaii E-commerce development introduction When E-commerce is emerging in China, Hawaii is not an innovator in this new rend. The reason is to connect with Hawaii business architecture. Hawaii is a leader TIC giant company in the world. In 2012, Hawaii group revenue was 35 Billion USED. The mainstream business is carrier business.

In 2011, Hawaii redesigned the business organization, Carrier business; Enterprise business and Device is troika. Carrier and Enterprise business are belonging to EBB business, Device belongs to BBC business. For the first two parts, there is no opportunity to expand the business by internet. Device business is the best platform to expand business on E-commerce. Hawaii Device Business Unit was founded 2004. After 8 years development, the revenue of Device business reached 7. 4 Billion USED in 2012. Device Business Unit was re-named Hawaii Consumer Business Group (Hawaii CAB) in 2011.

Hawaii CBS provides mobile phone, mobile broadband, home devices and chippies product to consumer. Hawaii CAB wants to be TOP brand in the end of 2018 on mobile phone industry. This is very challenge target consider about the competition on mobile phone business area. Hawaii CAB only started own brand mobile phone from 2011. Device business has been tried to enter into E-commerce in 2008, after economic crisis. The growth of Device business was slow, Device management want to get breakthrough on E-commerce. The decision was ended by Hawaii founder?Rene Zingier. “Hawaii never enter into internet business area”.

Rene claimed in the internal meeting during 2008. The uncertainty of E-commerce was Rent’s concerns. He doesn’t want to expand Hawaii Device business enters into the area he never touched before. But market development is exceeded Hawaii CAB expectation especial in China market. China market is the most important mobile phone business region for Hawaii CAB. The shipment of Hawaii smart phone market share in China region was ore than 45% of total Hawaii CAB. Hawaii reached 9. 9% market share and to be No. 4 position. (firm), the performance looked very well. But E-commerce Just changed the existing market situation.

In 2012, Axiom, one pure China E-commerce smart phone player, sold more than 12 million units phone. In the end of June 2013, Axiom have sold more than 7 million units smart phone in China market. All sales are online. Axiom rapidly became the favorite by investors. Axiom market valuation was more than 10 billion USED in June, 2013. Axiom’s success in China motivated Hawaii CAB to expand the channel. After all, traditional channel cost is higher than by Hawaii CAB. Hawaii have strong R&D and experience on production. Hawaii can do more on E-commerce. But the strategy still needs Mr.. Rent’s approval.

Rene Zingier reviewed his opinion on E-commerce and changed his mind. In 2013, Hawaii CAB had internal meeting in Shanghai to discuss the sales strategy. Rene Ghent fee attend this meeting and encouraged Hawaii CAB to enter into E- commerce. Mr. Rene claimed: “When E-commerce is ready, we can sell everything, not only mobile phone. We can sell win, the beef we bought from Argentina. Our goods laity is guaranteed, Jingling and Taboo can’t control their goods quality. We have enough sources of goods, we have more than 140 countries sales network, and we can sell any country high quality goods by E-commerce.

Our mobile phone and other devices accessory can be sold in E-commerce in the future”. This claim was named “June Declaration” in internal. Based on Rent’s claim, Hawaii CAB had several meeting to discussed and made E-commerce strategy. I will expound the strategy in the consequent parts. Firm: China smartened market share 2012 Apart Hawaii E-commerce strategy and implementation 2. 1 Hawaii E-commerce strategy Hawaii E-commerce strategy is different than pure E-commerce players. Hawaii still have traditional sales channel and partner. E-commerce is only one channel and important supplementary channel to reach business strategy.

So the E-commerce strategy is to develop and enhance internet sales by local market conditions and make different strategic plan for local market. In the end of 2018, Hawaii CAB wants to reach 40% revenue of total sale by E-commerce. Currently, the figure was 2%. Under this strategy, Hawaii CAB gave the further explanation and requirement: 2. 11 Hawaii CAB established E-commerce Department and empowered it operation is avoidable in China market. In the end of July, Hawaii CAB finished Hawaii V-mall. In the end of August, Hawaii E-commerce operated the first mobile phone launch in Hawaii V-mall. . 12 Hawaii will establish oversea V-mall in Indonesia and Russia in the end of 2013. In these two countries, Hawaii CAB business development is excellent. Brand awareness and business environment can support Hawaii to build V-mall. 2. 13 In European market, Hawaii CAB will enhance the cooperation with main E-commerce and improve the marker share on inline sales. Amazon will be the first priority to be strategic partner. In developed market, Hawaii CAB has sharp challenge for information security; the market investment is higher than developing market. V-mall is not the best way.

Mature business environment ask Hawaii CAB to respect the local business rule. Hussein’s reputation can’t support directly E- commerce business model in European market. Cooperation is smart way to develop Hawaii CAB E-commerce business. In the end of August, Hawaii CAB Germany smart phone sales in Amazon entered into Top. This is millstone in European market. WEEK region is important for Hawaii CAB to improve the performance on E-commerce. In he end of 2012, from SGF report, five big countries in WEEK average smart phone online sales market share was 17%. Form) Hawaii CAB wants to be Top Online Firm: Online smart phone market share in WE-IS 2. 14 In other region, Hawaii CAB will select flexible business model to develop E- commerce business. When the market environment is mature, Hawaii CAB will establish won V-mall. It is clear, Hawaii CAB Just look at E-commerce as a huge opportunity to develop business. On one hand, E-commerce channel cost is low than traditional channel. On the other hand, E-commerce also has its specific requirement. I will analysis the challenge and difficult for Hawaii CAB to deploy the E-commerce business strategy. 2. Hawaii CAB challenge and difficult on E-commerce implementation. For any new business model, the implementation is critical. Market insight lead to correct strategy, but the final result is to depend on implementation. Hawaii CAB inherited TIC DNA from Hawaii Group. E-commerce is total new business model. Capacity of internet knowledge and process, resource and execution are key factors for success. Summarize to say, Hawaii CAB have three main challenge and difficult to reach its E- commerce strategy. . 21 Digital capabilities. E-commerce is digital marketing. Everything is connecting to digital.

Hawaii CAB is lack of professional digital expert. But this is not the biggest challenge. Talent can be recruited. Digital marketing is internet thinking; Hawaii CAB is new BBC enterprise. The digital thinking didn’t deploy into Hawaii management team. Firm showed the gap between Hawaii CAB and competitors on Backbone fans. Firm: Hawaii FEB. fans comparison than main competitors 2. 22 Product management capability E-commerce price is aggressive than retail store price. That’s why E-commerce is emerging. Compare than traditional channel, transaction cost is reduced by online sales.

But the price and product management request is high. Especial when the traditional channel and E-commerce are coexist. Product differentiation is the first solution to manage price. Hawaii is new player on E-commerce platform. The product & price management is a sharp challenge. 2. 23 Security risk This is not the current challenge. But when Hawaii CAB starts to expand own V-mall to developed country in the future, security will be the biggest challenge. Hawaii brand reputation is not good in developed market. How to eliminate consumer and overspent concern on E-commerce security is critical for Hawaii CAB.