Huawei #BePresent Client: Huawei Brand: Huawei Start Date: 14/11/2016 End Date: 31/12/2016. Countries in which effectiveness was proven

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1 Huawei #BePresent Client: Huawei Brand: Huawei Start Date: 14/11/2016 End Date: 31/12/2016 Countries in which effectiveness was proven Austria Bulgaria Croatia Czech Republic Estonia Greece Hungary Latvia Lithuania Poland Romania Serbia Campaign Background The CEE smartphone market is extremely competitive due to an increasing number of brands/devices and growing market saturation. While in ,4m units had been sold (+24% vs 2014), in 1HY 16 growth slowed down to a single digit. Consumers do not see a clear benefit in upgrading their devices on an annual basis due to rather incremental than exponential updates. Purchase habits have also changed increasing number of sales comes from the open market. Brand s/model s choice becomes a well-thought decision rather than selection among telecoms offers. Huawei, a challenger brand, had a big launch in the Fall 15 reaching 18,1% market share (sales units) within a year (X 16) and becoming No. 2 brand after Samsung in CEE and No. 3 in CEE & Baltic countries, who is enjoying 37% regional market share as the category leader. Although Huawei has built relatively high brand awareness (70%- 90% depending on a market), only 18-28% of potential customers (depending on a market) consider Huawei while planning purchase.

2 The challenge was to change a stereotypical perception of a Chinese brand as aggressive, but of lower quality rather than well-established brands, and achieve it in a very competitive category focused on technology. The Spring 16 launch of Huawei P9 improved brand perception as innovative and progressing, but at emotional level brand remained indifferent. Without emotional connection with consumers it would be impossible to become the desired brand and achieve its competitive advantage. While previous campaigns were built around Huawei and products, in the coming campaign we decided to focus on customers telling them something important about themselves. Footnote: GFK, , CEE & Baltic region Objectives Communication goals increase consideration by at least 5 p.p. vs wave 5/IPSOS. Marketing goals increase Brand Desire parameter Huawei wanted to be among TOP3 the most desired brands in the markets. Huawei was ranked #5/6 in all markets (wave 5/IPSOS). Business goals increase market shares (sales units) across the region and in all markets. In XII'16, Huawei was to be at least 1 in 5 purchased smartphones in the region (out of more than 15 available brands) to gain at least 20% share (vs 18,7% in X 16). Be the fastest growing brand in the region. Footnote: GFK, , CEE & Baltic region. Serbia and Bulgaria are not included in GKF tracking. In these market, business goal is to increase sales, but we cannot provide market shares. Ipsos Connect, 2016 Brand Tracker Huawei Consumer BG 2016, wave 5 July 2016, conducted in 7 out of 10 markets (no data for smaller markets Latvia, Estonia and Croatia. Huawei does not conduct tracking research in the mentioned markets). Creative Strategy HUAWEI's marketing mission was very complex: choosing differently - the best technology in a reasonable price. credibility and legitimacy as an innovative and a breakthrough brand. In the beginning of 2016 we launched the most innovative smartphone camera: P9, co-engineered with LEICA. We have established the HUAWEI's perception as progressing and advancing brand. Nevertheless, we understood that in the next

3 campaign, we must also strengthen the emotional connection with HUAWEI in order to be the most preferred brand in the market. HUAWEI'S target group is urban, lifestyle and young (25-45 years old). The mission was to deepen the emotional connection with this target group and the perfect timing for that was Christmas. Like every year, the media were filled with hundreds of holiday Ads for Christmas. It was now clear that so many things have already been said about 'this time of the year', and frankly, most ads somehow started to sound the same. As a smartphone brand, it was almost expected of HUAWEI to present an ad that sells, well smartphones. But we knew that our campaign must stand out and lead a whole new strategy statement: present a whole new approach that will give the consumers an emotional benefit. Thus, we have decided to ask people to put their phones aside once a year and focus on what's really important: being together with their families. Christmas dinner is a symbol of unity and perfection. Walt Disney once wrote: "Christmas isn t about candy canes or lights all aglow, it s the hearts that we touch and the care that we show. Unfortunately, technological development and competition for pixels, gigabytes and multicore processors led to a situation, when people started to be more with themselves and less with their families. Family members are occupied with their eyes and hands, in their personal smartphone screen, without really being with the family. Even on Christmas. Our main story featured a young child who brings back the true meaning of 'Christmas', with a small Christmas wish: To feel his family with him. We have inspired millions of families to once a year, put their smartphones aside: MAKE A SPECIAL MOMENT POSSIBLE. BE PRESENT. HUAWEI. We wanted our consumers to feel that we really understand them and that on Christmas there are issues that are far more important than sales. We knew that by addressing the most significant & strong insight which reflects the deepest inner feelings of our consumers, we will be able to build the emotional relationship between them and HUAWEI's brand and change a negative, stereotypical perception of a Chinese brand as aggressive, but of lower quality vs competitors. Communications Strategy Knowing that the biggest challenge was to change the stereotypical perception of the brand, the key target group were individuals, who could play the opinion leaders role in a broad audience. Therefore we focused on those, who are the most interested in new devices, appreciate premium design and technological advancement at a decent price (value for money). From a demographic perspective young adults (25:45), urban, lifestyle.

4 #BePresent multimarket campaign strategy was to deliver the message effectively and build engagement in the whole region. We employed a broad mediamix including TV, VIDEO, cinema, OOH/POS, digital, vloggers and brand ambassadors. Media mix and campaign intensity were adjusted to the local market s media usage and market sales potential (e.g. in smaller markets focus on 2-3 media). Due to campaign goals and strategic challenge, campaign was scheduled for and the budget was cumulated in a pre-xmas period, the most cluttered period of a year. To stand out we leveraged a long 60 TV/video/cinema format additionally enhancing emotional message. Just before X-mas, product communication was limited, focusing on the main campaign message Put your ( )BePresent. We worked together with brand ambassadors (Robert Lewandowski (main) and Jaromir Jagr (only Czech)) to strengthen the message by recording dedicated videos inspiring the audience to put smartphones aside and spend time with their relatives. To distribute ambassadors videos, we created the first in Europe multimarket influencers network on Instagram (done in cooperation with InDaHash)! To build credibility, buzz and effectively convey #BePresent message we invited top vloggers and celebrities in various markets to record similar message and share it on their vlogs and via Instagram. We created the Gift Shop offering the most precious gifts for our relatives ourselves. This local event held in Poland and popularized via social media created a lot of positive buzz around the brand in the markets. To maximize campaign efficiency we centralized buying digital activities (Google/YT, FB, Instagram) across the region, significantly lowering campaign costs. Close cooperation with YouTube resulted in a unique, tailor-made offer for Huawei (never used before in the CEE region) and was nominated as Google s best in class campaign. In most markets Samsung was active in IX-X (before Huawei campaign) investing less than Huawei in X-mas campaign, but was extremely active in POS. Huawei X-mas budget was higher due to premium 60 spots and OOH placements. Apple was active in several markets with various budgets.* Footnote: Source: Kantar, Nielsen, own agency observations. CEE/Baltic market is not the best monitored in terms of media spending, often does not include digital or provide limited number of monitored media. It is hard to provide accurate estimations. Media Allocation Chart Television: 61 Interractive/online: 25

5 Point-of-sale: 8 Other: 6 Specify: CINEMA & OOH (meshwalls) Total commercial communication expenditure: 5m Euro to under 10m Euro Major Competitors Marketing Communications Expenditure Competitor Name Expenditure: Samsung ~3m euro Apple ~1,75m euro Additional Information During campaign period Huawei cooperated closely with mobile operators and retailers (including media cobranding campaigns) offering Huawei devices. These were standard activities conducted by producers of mobile devices. Evidence of Results - Summary All campaign goals have been reached or exceeded. Brand consideration increased significantly in all markets, while at the same time rejection rate decreased. Huawei improved at all brand levels starting from awareness to preference and even primary usage. Huawei brand growth translated in improved Brand Desire score and shift in the ranking. In majority of markets, Huawei is now ranked 2-3rd among the most desired brands (vs #5/6 after previous campaign), so improved brand equity significantly. In terms of sales, Huawei was the fastest growing brand in the CEE & Baltic region gaining 21,7% share of market in terms of sales units in 2016 December (vs 18,1% before the campaign in X 2016). Huawei enjoyed 87% increase of sales, while in the same time the CEE & Baltic market increased by 56% (XII 2016 vs X 2016). More than 1 in 5 sold smartphones was Huawei during the campaign (regional goal exceeded). In all markets Huawei experienced sales increase resulting in further strengthening of market shares. The only exception was Romania, where sales increased, but slower than the market. Campaign results clearly prove that we met the challenge and broke the stereotypical perception of the Chinese brand as aggressive, but of lower quality vs well-established brands. Huawei built emotional connection with its customers which resulted in increased consideration, brand desire and market shares.

6 We earned a lot of positive publicity in traditional and digital channels. Campaign was highly commented and appreciated by ordinary people (our potential customers) as well as by branch media (opinion leaders). Focusing on customers and telling them something important about themselves (and not about the brand itself), was a brave, but very successful move. We broke a flat-thinking communication pattern in an extremely competitive category. Both, in terms of the content #bepresent put your smartphone aside and the form e.g. 60 TV spot, our strategy stood out in the category and contributed to spectacular results, at the same time attracting attention and promoting universal rather than just commercial values. Huawei has become one of the most desired brands thus having increased market shares across the Region and in the individual markets.