One Plus Project Report PDF

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OnePLUS

Group Project for Marketing Management – II 12/16/2019

Submitted to: PROF. RAMBALAK YADAV Submitted to: GROUP NUMBER: 10 AASTHA MOHANE AKANKSHA POORNA AYUSHI SINGH DIPANKAR SHINDE DIVYA SINGH PRATIKSHA MISHRA

– 19A1HP099 – 19A3HP614 – 19A2HP423 – 19A3HP667 – 19A2HP459 – 19A1HP057

Introduction The Shenzen, China-based smartphone company that also owns brands like OPPO and VIVO, operated by BBK Electronics is a manufacturer of the OnePlus mobile phones, which was founded in December 2013 by Pete Lau and Carl Pei. “Never Settle” is the company’s slogan which strengthens the company’s’ ideals of simplicity and quality of how one needs not to compromise with quality for lower-priced devices. In the beginning, to stand by their ideal of reasonable pricing with better quality the company decides to sell their phones online so as to avoid any extra cost for shops and display stores. The initial production was planned for only 50,000 phones and thus an invite system became an important part of the whole marketing strategy due to low inventory. It entered the Indian market in 2014 with OnePlus 1 phone which was its first-ever phone and it was on the same global strategy of invite-only which created a huge buzz and made the buyer buy the invites too. The unusual style of marketing by only providing it via invite which immediately put it in a niche market with solid specification as well made the brand one of the unique OEM in the mobile market. Later, Company launched OnePlus 2, OnePlus X, OnePlus 3 to latest like OnePlus 7, OnePlus 7T and OnePlus 7TPro. The upgrade of hardware and software optimization has only gotten better and better every year since the launch. To keep up with the competition and also to deliver on to their promise of the best quality the constant increase in the price with each new launch is making consumers a little worried as well as it has its image of a phone with reasonable pricing. Also, the multiple launches in a single year is quite a divergent strategy from how they started off and made themselves the invite-only phone to be purchased that created the mystery around it and a buzz of curiosity for the customer but now it is making them confused as to wait for the next launch (which might happen soon following current style) or to purchase it right away the current model.

Product Strategy •

Product Classification

OnePlus mainly deals in Durable Goods, “Durable Goods are defined as tangible goods that normally survive many uses.” OnePlus also provides protection i.e insurance services for the phones purchased. This service can be availed by customers who buy OnePlus phones, the services act as an extended warranty. Smartphones are classified as specialty goods, “Specialty goods are those goods which have unique characteristics or brand identification for which enough buyers are willing to make a special purchasing effort.” Consumers are driven by both unique characteristics and brand identification in the case of OnePlus. Even though the products are not easily available in a regular retail store, consumers are ready to wait for their smartphone to arrive 24-48 hours after purchase.

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Product Differentiation

Form- OnePlus offering are ergonomic, the smartphones with huge screens are handy and comfortable to operate. The current offerings have bezel-less displays, which gives OnePlus mobile

phones an edge over the competitors. Though the design was not the main focus in the initial offer, now the design of the offering is as focused as the specs. Features- OnePlus dominate other smartphones when it comes to features to price comparison. OnePlus smartphones offer the latest processors by Qualcomm, the latest offering OnePlus 7T is powered by Qualcomm Snapdragon 855 plus processor. Performance Quality- The level at which the product’s primary characteristics operate is termed as Performance quality. The performance level of OnePlus is a superior level, in 2018 OnePlus sold most premium phones in India. Premium category was dominated by Samsung for many years, but flagship features in fraction price of Samsung's flagship crowned OnePlus the leader. Conformance Quality- The conformance quality of OnePlus smartphones is very high. The products are similar, no customization is offered which means the products are similar and function identical. As OnePlus smartphones are offered to diverse segment the uses of these smartphones are very different. Durability- The operating life span of a product under natural or stressful conditions is known as durability. OnePlus claims that smartphones undergo rigorous tests before being finalized which ensures durability. OnePlus offers protection plans i.e. insurances plans for phones to make sure they serve the customers longer. The body of OnePlus devices is mainly aluminum which provides a strong yet light structure. Reliability- OnePlus has proved itself as a reliable brand throughout the years. The reliability of products has created the market share which OnePlus is enjoying right now. Malfunctions or failures are negligible has the products are packed with high-end features and specifications Repairability- The ease of fixing malfunctions or failure, when OnePlus started it had no brick and mortar stores, which meant servicing the products would be time-consuming. OnePlus has come up with service store across India, though the stores don’t work whole India they are helping gather costumers who refused OnePlus products over service issues. Style- OnePlus products look and feel premium, it’s easy to distinguish OnePlus smartphones by the premium look and the AMOLED screen. The new phones also have a pop-up front camera which sets the pro series of the phone apart.

• Product Mix Product Mix is defined as the total sets of products a particular seller has to offer for sale. The product mix consists of various product lines, in the case of OnePlus it has a total of six product lines. The Product mix includes product width, depth, length, and consistency. Width- “The width of a product mix refers to how many different product lines the company carries.” OnePlus currently has a product mix width of six lines. Length- “The length of the product mix refers to the total number of items in the mix.” From the table below we can say the length of the product mix is 28. Depth- “The depth of a product mix refers to how many variants are offered of each product in the line.” For example, OnePlus 7T is available in two variants. Consistency- “The consistency of the product mix describes how closely related various product lines are in end-use, production requirement, distribution channels or some other way.”

Product Mix Width and Product Line Length Smartphones

Earphones Bullet Wireless (2018) Bullets Wireless V2 (2019)

Televisio n Q1 Series (2019)

Cables

Protection Accessories Bumper Case

Gear

Q1 Series Pro (2019)

Wrap Charge

Protective Case

JCC Tote Bag

Screen Protection Guard

JCC Baseball Cap

OnePlus One

(2014)

Power Adapter

OnePlus 2

(2015)

OnePlus X

(2015)

Car Charger

OnePlus 3 OnePlus 3T

(2016) (2016)

OTG Cable Type-C Audio Jack

OnePlus 5 OnePlus 5T OnePlus 6 OnePlus 6T OnePlus 7 OnePlus 7 Pro OnePlus 7T OnePlus 7T Pro

(2017) (2017) (2018) (2018) (2019) (2019) (2019) (2019)

Explorer Bag Pack

• Product Map The product map below compares OnePlus and three other smartphone manufacturing firm in India. The map compares the various product lines offered by the companies and compares them on the basis of price and quality of the product. PRODUCT MAP

A

A LUXURY FE AT UR ES

O

X

X

O

S

S

MID-LEVEL X S BASIC X

S

S

LOW

MEDIUM

HIGH

LUXURY

PRICE

A -APPLE

O-ONEPLUS

S- SAMSU G

- XIAOMI

A

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Co-Branding and Ingredient Branding.

When two or more firms come together to make a product, thus offering product or service as an outcome of this venture this is called Co-Branding or Dual Branding. OnePlus has so far Co-Branded with 6 firms and offered a smartphone as a result of this Co-Branding. OnePlus launched 6 limited edition phones which were similar to the market offering but had something extra, like different packaging, free cases, etc. Year 2014 2016 2017 2017 2018 2018 2019

Company JBL Colette JCC Star Wars Marvel Avengers McLaren McLaren

Product OnePlus JBL Limited Edition (OnePlus One) OnePlus 3T Colette 20th Anniversary Edition OnePlus 5 JCC + Limited Edition “Callection” OnePlus 5T Star Wars Limited Edition OnePlus 6 Marvel Avengers Limited Edition OnePlus 6T McLaren Limited Edition OnePlus 7T McLaren Limited Edition

Ingredient Branding- OnePlus smartphones are known for the high-end specification it provides in smartphones. Consumers associate OnePlus as a premium brand because of the features provided. OnePlus uses Qualcomm processors to power smartphones, every advertisement of OnePlus smartphone will mention the processor, for example, OnePlus 5T powered by Qualcomm Snapdragon 835 Octacore processor. OnePlus also advertises Gorilla Glass, which is an important ingredient of the AMOLED display.

Modification in Product Strategy In initial years OnePlus launched one flagship smartphone, OnePlus One and Oneplus 2 were launched in 2014 and 2015 respectively. Though OnePlus X was also launched in 2015, it had specifications of OnePlus One and was not an upgrade of OnePlus 2. In 2016 OnePlus launched two phones in an interval of six months, OnePlus 3 and OnePlus 3T. OnePlus 3T cannibalized OnePlus 3 as it was superior in specifications. The owners of OnePlus 3 felt betrayed because their phone became old within six months. OnePlus should avoid this or provide better exchange offers to keep existing customers satisfied.

• Packaging OnePlus uses a hard cardboard box as the outermost protection for the whole unit and is the packaging of the device. Inside the packaging box, there is the main unit, charger, user manual, sim pin, screen guard and warranty card. The packaging is very appealing and distinguishable, OnePlus uses a combination of red and white colors for packaging as the brand logo is also in the same colors. The appearance is soothing, the inner cardboards are bright red which grabs attention. OnePlus changes its packing for special edition smartphones.

Modifications Though the limited edition smartphones having different packaging is a good idea, it may create confusion in consumers and the packaging won’t be distinguishable.

Pricing Strategy Survival At the time of its launch in the year 2014, Oneplus had survival in my mind. It hoped to penetrate the market and survive. It had decided to position itself as a brand that provided phones which were on par with other premium brands yet did not come too hard on the pocket. Its primary focus during its launch year was delivering high-end quality at affordable prices. At the time of its inception Oneplus one, the first model to be launched cost $299 which was extremely reasonable given the features the phone had. In India, the phone cost ₹19,999, again reasonable given the smartphone market back then.

Maximum Market Share A phenomenon wherein companies set lower prices in a price-sensitive market in the hope of getting the largest market share. Oneplus was able to achieve this goal as within the 8 months of its launch OnePlus managed to sell around a million units. The company managed to do this through its various strategies including selling only on an invite-only basis which helped them ascertain the demand and hence have some control over the cost. Apart from this a lot of the fixed costs were absorbed by Oneplus’ parent Oppo. The pricing model, however, worked wonders for the company which managed to achieve its goal of positioning itself as the ‘best’ phone in the market in that price segment. The phone was affordable but did not compromise on quality.

This strategy, however, gave way to the later pricing strategies of the company which was quite different from the company’s initial stand.

Price Quality Leadership and Price-Quality inferences A brand striving to be an ‘affordable luxury’ by providing products or services with high perceived quality, taste and status with a price just high enough to not be out of consumer’s reach. It is now priced according to what consumers are willing to pay for a premium brand also known as pricequality inference, a phenomenon wherein the consumer use price as an indicator of quality. The company has now stopped talking about cost and rather focuses on its performance instead. As the phone gained prominence its pricing strategy took a complete u-turn. From a cost-based pricing model, the company moved to a value-based pricing model. The brand capitalized on its growing reputation and steadily and strategically increased its prices. In India, Oneplus 6 was launched at a fairly high price of ₹34,999 in 2016. More recently Oneplus 7 t was launched at a staggering ₹53,999 with the Mclaren limited edition priced at ₹58,999. The company riding on its success and the fact that it is now counted among the likes of Apple and Samsung has done a complete overhaul in its pricing methods. Oneplus is now a premium brand and so is its price.

Promotion Mix Promotion Mix is a subset of the marketing mix which includes all of the company’s activities that they undertake to promote and push forward their products into the target market. The different characteristics that OnePlus focused on while promoting its smartphones are: Clarity: “Never Settle” the one mantra OnePlus has always followed and for that, they have launched a new product every six months and before the launch, they provide the phone to few influencers like YouTube reviewers, etc who would use the phone extensively and then post the review on the day of the launch which provides the customer much more clarity about the product. Relevance: Its ideal of providing the best quality at a reasonable price is what makes it much more relevant to its user as compared to its competitors like Samsung, Apple, etc without any compromise on the quality, durability, and performance. Uniqueness: OnePlus does not decrease the price of its current flagship phone until the launch of a new one which provides the customer with a feeling that the phone is not an old edition even when they buy it after few months of launch. This strategy has been followed by Apple as well and has been a great success for both. Consistency: It always makes sure that it takes in all the customer feedback and tries to implement them in the next product launch which gives them a better version of the phone always not just in terms of hardware in terms of software as well. And they also have been consistent with the updates of software regularly as well. Including these characteristics, the few different promotional strategies that have been followed by OnePlus are: •

Persuasive Advertising In this advertising, the company tries to create brand awareness and the functional knowledge of the product and also at times compares the brand with another company’s products like OnePlus did and they also made the launched the slogans with each product which differentiated it from others and they also made ads which were clean, concise and made fun of other brands which are ethical as they didn’t use anyone’s name or specified any brand. Some of those slogans are: Product Number 1 2 3 4

Product Name

Slogans Associated

OnePlus One OnePlus X OnePlus 2 OnePlus 3/3T

5 6 7 8 9 10

OnePlus 5 OnePlus 5T OnePlus 6 OnePlus 6T OnePlus 7/7Pro OnePlus 7T/7T Pro

Flagship Killer Exquisite Design Flagship Killer 2016 A Day’s Power in Half an Hour Dual Camera. Clearer Photos A New View The Speed You Need Unlock the Speed Go Beyond Speed Smooth Like Never Before.

Some of those ads are:

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Public Relations It is a promotional strategy where lots of steps like programs, events are promoted which would help in protecting a company’s brand image or product image as well as improve it. Online reviews, social media presence, and community-based fans. Making Amitabh Bachchan and Robert Downey Jr. as the brand ambassador. Every six months there is a huge hype created for the launch of OnePlus devices and the products do not disappoint. Amazon always starts a quiz before the launch of every OnePlus phone winner of the quiz (Lucky 5) will be awarded free OnePlus phones. It all helps in creating a positive image of the brand in the mind of the customer.

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Direct Marketing In this marketing strategy, there are no middlemen involved and the channel is directly between the company and the customer to communicate or to deliver goods and services. OnePlus has a community-based forum that is clean and organized and is kept so by the users themselves and when users give some feedback their company tries to make sure that those problems at least software-related are solved in the next software update that is sent to users. They also have set up different experience stores across various countries to get in touch with the customer and learn from the feedback from the customers. They all help in customer retention and increasing their satisfaction with the product.

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Digital Marketing To be in connection with the customer via social network, mobile or online marketing and promote the product through the same medium. OnePlus sends the mails to customers who opt for it and provides them with information about a certain product or its specification in advance. They also ask users to accept cookies to track their purchases and orders and manage the database as well. It also sends promotional emails regarding sales and offers.

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Sales Promotion As OnePlus uses a selective distribution channel, it is easier to manage sales promotions without degrading the premium image of the brand. OnePlus provides regular discounts like during festive seasons and during Amazon Great Indian Festive Sale. OnePlus also provides discounts on purchase by credit card of certain banks. OnePlus is celebrating its 6th Anniversary this month and as a gesture of gratitude is offering discounts on all the smartphones currently available for sale.

Distribution Strategy Invite Only When OnePlus entered the Indian market with OnePlus One, to be cost-effective OnePlus came up with invite-only marketing and distribution. New company with huge potential but little capital decided to reduce the inventory holding cost and used Amazon exclusively to sell the product. Though the strategy was to used to act as a cost reducer it acted as a marketing gimmick in favor of OnePlus. Invites were distributed to the online community, tech enthusiasts and influencers and then to owners of OnePlus. Owning a OnePlus meant you are part of a special group, which made the product exclusive, thus spreading by word of mouth. OnePlus discontinued the process after OnePlus 2, as the startup surpassed their goal, a secondary reason for discontinuation was the invite-only system was due to the misuse of the invites, invites were sold by the owners to the people who wanted Oneplus devices.

Distribution Channel Exclusive Distribution OnePlus used Amazon as the distribution channel for the earlier generation of its phones. The targeted customers were teenagers or adults who were tech enthusiast so had access to Ecommerce website like Amazon. After initial success, OnePlus also start...