Amid South Africa’s burgeoning smartphone market, a brand is preparing to make a comeback, taking another crack at the local market.
Honor will soon offer two new devices – the Honor 50 and Honor 50 Lite – in South Africa, as the smartphone brand charts a new path sans its former parent company, Huawei.
Kelvin Cao, GM of Honor SA, tells ITWeb it made sense for the brand to return locally, adding it has strong ambitions to be “number one in this market in three years”.
“We know [this will be] tough, it won’t be easy; especially now that the competition situation here [South Africa] is getting more complicated. But, we have some confidence.”
To achieve the top spot, Honor will have to contend with tough competition from iconic tech brands such as Samsung, as well as its former parent Huawei.
Other Chinese original equipment makers (OEMs) are also trying to make inroads in SA, with analysts saying the high smartphone penetration rate makes the country a lucrative market for device producers.
Cao, who previously worked at Huawei’s Africa operations for over six years, believes the team currently driving Honor SA’s operations has good and bad lessons learned from Huawei, and knows how to communicate with customers and partners.
“It’s very important for brands to achieve that number one and all the other OEMs would like to say the same, but SA is our top 10 market, globally. We have a long-term investment plan in this market.
“Secondly, the products and solutions are most important. On a global scale, Honor has four R&D [research and development] centres – and 50% of the new Honor team are in the R&D function. Our R&D funding investment ratio is around 7% to 8%, and that’s almost double or much higher than any other Chinese OEMs. We have over 400 strict product testing standards.
“As we have a long-term investment plan, we have end-to-end solutions for this market. For now, we already have a staff complement of more than 20 people…we’d also like to build our country warehouse in this market.
“We know the South African market is not an easy market; we have to be fully prepared.”
As Chinese telecommunications giant Huawei faced pressure following restrictions imposed by the US, it sold its Honor smartphone sub-brand last November to Shenzhen Zhixin New Information Technology, in an effort to save it.
Huawei said the sale will help Honor's channel sellers and suppliers make it through this difficult time. “Once the sale is complete, Huawei will not hold any shares or be involved in any business management or decision-making activities in the new Honor company.
“This move has been made by Honor's industry chain to ensure its own survival. Over 30 agents and dealers of the Honor brand first proposed this acquisition,” noted Huawei.
Under new ownership, Honor’s devices will be equipped with Google Mobile Services, which are the Google apps that often come pre-installed on Android devices.
Honor first entered the South African market in 2018, becoming a recognisable brand under the Huawei banner. It focused on the youth market, by offering phones in the low- to mid-end price range.
To let customers know Honor is back business in SA, the brand will later this month and in early December launch its high-end Honor 50 and mid-tier Honor 50 Lite, according to Cao. “In the future, we’d like to slowly expand to other pricing tiers.”
Commenting on having Honor stores in the local market, he explains these will mainly be service stores. “We know that service, quality and customer satisfaction is the most important and is key to us.
“We want to use three years to build an iconic service level in SA. This year, we want to ensure basic full service for our customers, but from next year, we’d like to build our service stores in key cities to make sure customers have direct connections with the Honor brand.
“Customers can go to the stores to fix their phones, buy accessories or any other add-ons.”
In terms of device sales, the GM reveals the brand plans to work with top network partners: Vodacom, MTN, Telkom and Cell C. “We’ll also be doing business with key retail partners like TFG, Edcon, etc.”
In the past, Honor also partnered with online shopping platform Takealot for device sales.
“We want to cut the cost for the customer and make it easy for them to get our products, so we’d like to work with all the top channel partners.”