SWOT Analysis of Huawei Case Solution

1.Strengths

1.1.Competitive pricing

Huawei has entered a saturated market of ICT products – which offer consumers similar product benefits. Huawei, as a result, has marked its differentiation by offering high quality products at a competitive price. This has been made possible for Huawei through mass production in operations, as well as through beneficial contracts with suppliers of raw materials and inputs. Additionally, Huawei also has strategic partnership with software developers, which has allowed it to market its products at a reasonably competitive price (SCMP Reporter, 2008).

1.2.Quality          

Huawei maintains high quality and durability in its products. The company markets all its products as being sturdy and hi-tech at the same time. The company promises quality and value for money in its ICT products. Consumers are drawn to the Huawei brand because of the high quality features and benefits it offers through the product use, at a competitive price. The company makes use of high quality raw materials in developing and engineering its products, and also for assembling purposes – which makes them resistant to damage. The internal quality management systems also allow the company to ensure high consistent quality of its products (Huawei, 2019).

1.3.Focus on consumer research

The Huawei company is also well known for its research and investment in understanding consumer and market trends and behaviours. This has allowed the company to develop ICT products that meet the needs and demands of the consumers. Moreover, the investment in research and development has also allowed Huawei to develop product features and offerings that will appeal to the consumers and market them at competitive prices for high penetration and trial rates (Kharpal, 2018).

1.4.Presence on social media

Huawei has a high presence on social media. The company manages its social media marketing and presence through in-house profession teams, as well as external consultants. Huawei markets all its products and their unique features online. Moreover, it also uses its social media presence to engage with consumers directly and answer their queries and questions. The presence on social media has also allowed the company to understand its target consumers better, and engage with them more directly, and at a deeper level so as to create strong brand connections (Hammett, 2019).

1.5.Integrated marketing communications

The company also makes use of integrated marketing communications in all the channels that it uses for marketing – including OOH, social media, and print marketing. In the print marketing category, the company largely advertises through newspapers and placements in magazines in consumer relevant publications. The integrated marketing communication has allowed Huawei to reach its target consumers as well as secondary consumers, and communicate the brand message singularly. This has helped the company avoid confusion over what the brand offers and promises – and instead, has helped Huawei communicate its brand message and promise of quality at competitive prices clearly to consumers (Hammett, 2019).
 

2.Weaknesses

2.1.Weak brand image

Despite its competitive pricing and consumer research, Huawei has not been able to create a strong brand image. This is primarily because of the company’s heritage – which is Chinese. Consumers fail to associate advanced technological developments with the company’s Chinese origin and also fail to associate high quality with a Chinese brand. As a result, the company has a poor brand standing and a poor brand recall. Moreover, given its Chinese heritage, consumers also fail to associate unique features with the ICT products offered by Huawei – and instead, see it as a secondary brand (Vizard, 2018).

2.2.Lack of capital

With a low general trial rate and limited expansion, the company also faces a lack of financial cushioning and support. Limited financial access and support have forced the company to limit operations in Asian countries at large and restricted its expansion plans. Limited financial access and support have also forced the company to restrict innovation and new product developments, and instead, focus on existent goods and services. Moreover, because of limited financial access, the company also has a restricted supply chain and distribution model – forcing the company to operate and make sales through third-party agents instead (Huang, 2019).

2.3.Mature market set up

Huawei has started its operations for ICT products in an industry that is already mature, with a high number of players in it. For Huawei, this means restricted access to the consumer base which would already have formed alliances and loyalties to other brands. Breaking through the clutter and forming new brand loyalties would require not only high financial investment – but also breakthrough innovation – both of which are not accessible for Huawei. As a result, the company must become one of the many players in the industry that offer similar benefits and features to consumers –and only compete through price at large (Wong, 2012).

2.4.Limited expansion

Because of its limited financial access and support, as well as because of limited exposure, the company has invested minimally in expansion regionally. The company has not explored the western markets at large, and instead, has focused its operations on the Asian countries and markets only. The limited expansion has also restricted the company’s access to new consumer bases, and markets, as well as limited its access to synergizing innovation and creativity through exposure to different consumer setups (Culpan, 2018). As a result, the company is limited in its production operations, as well as sales and distribution channels.

2.5.Limited investment in a physical retail

Huawei also has a limited to negligible investment in physical retail that is owned and controlled by the company. Instead, Huawei makes sales and distributes its products through third-party agents – who also stock and market products of competing players. Moreover, the company has not created trade relations with these distributors – who then do not feel obliged to push the company’s products to the consumers. Physical retail et ups owned and controlled by the company will give Huawei access to consumers directly, and will allow it to communicate its offerings more clearly – thereby allowing it to use push and pull marketing strategies at the same time (Huifeng, 2016).