Chapter 192 Youth Good Products Asking for Monthly Tickets

【Meizu completes $5 million in financing, with Taihe Capital leading the investment and Alibaba following. 】

On April 4, Xie Jingxing posted a photo with Huang Zhang on Weibo, confirming the authenticity of recent financing rumors and announcing that he would serve as CEO of Meizu.

Teacher Ma, who is far away in New York, took the lead in forwarding the comments, and many colleagues in the circle publicly congratulated him.

With Xie Jingxing's 500 million followers, this Weibo post was popular enough to top the trending search list and convert tens of millions of dollars in brand promotion value.

But it’s not the case today. South Korea sank a ship, dominating the front pages of news both at home and abroad, and throughout Southeast Asia.

The hype surrounding the black swan incident was in vain, and Xie Jingxing was upset. Fortunately, Mr. Ma returned to China at the end of the month and made an appointment to meet with him and Huang Zhang. Then they could take a group photo to rehash the old story.

After half a month of discussion, Meizu's strategic financing has finally been settled.

Huang Zhang personally holds 68% of the shares (including indirect shareholdings by multi-layer risk-isolated third-party institutions), the management team option pool holds 17%, Taihe holds 10%, and Alibaba Group holds 5%, with corresponding contributions of 20 billion yuan and 10 billion RMB.

This amount of funds is a key project for both Taihe and Alibaba.

Not only did Mr. Ma meet with him personally, but Xie Jingxing also traveled all the way from the Meizu headquarters laboratory to the cooperative suppliers with an entrepreneurial spirit, perfectly taking on the role of CEO.

After several days of running around, he returned to the company's headquarters building and completed a simple decoration of his office.

The office is at the end of the corridor on the second floor. In the middle of the corridor is Bai Yongxiang’s office, and at the other end is the product technology laboratory.

The area is not large, the furnishings are simple and the colors are elegant, which is in line with the brand's usual Nordic and cool tone.

A few pots of green ivy sway in the wind by the windowsill, and a emerald green money tree placed in the corner looks out of place. For southern entrepreneurs, this thing is like the Three Pure Ones to an old mother, it is a belief.

Xie Jingxing didn't care. He said he wanted to stay in Zhuhai permanently, but in fact he had to leave after finishing the work at hand and couldn't stay for more than a few days.

"That's it for now. If you're not satisfied with anything, I'll arrange for someone to make adjustments."

After introducing the office, Bai Yongxiang observed the other person's expression and said, "We just finished renovating it and need ventilation to disperse the toxic gas. Let's go to my office to talk first."

A few days ago, he accompanied Xie Jingxing to investigate and inspect the supply chain. They saw that in a small factory producing battery flame retardants, the older workers did not wear protective clothing and were directly exposed to the process environment with industrial pollution.

The newly appointed CEO bought a batch of protective clothing with his own money and persuaded the deputy director in charge of reception to pay attention to production safety and health.

Bai Yongxiang thought that these were the first three things a new official would do upon taking office, but he never expected that when he was returning from a planned investigation, Xie Jingxing would insist on making trouble for himself and suddenly go to the small factory for a re-inspection.

The result was that protective clothing was thrown all over the floor, and some people even sold them directly. However, there were a few people who listened to the advice and wore protective clothing, but they all got heatstroke and were sent to the hospital.

The workshop is too hot and the cooling equipment is limited. The factory director calls for corresponding national policies to save energy, reduce emissions, reduce costs and increase efficiency. Popsicles and mung bean soup are available for you to eat as you like. His wife and mother get up early every day to cook.

If you want air coolers, negative pressure exhaust systems, or industrial ice cubes, forget it. They all cost money. Anyway, Meizu is not Apple, and the order volume is limited. It is impossible to cancel the cooperation because of such a trivial matter.

After the factory director said this, Bai Yongxiang saw Xie Jingxing blush and speechless for the first time. He then realized that the young CEO was not trying to gain power, but was really dissatisfied with the supplier's polluting production environment.

"I always thought I was a qualified capitalist, but after seeing these manufacturers in person, I feel inferior."

Xie Jing Xing closed the office door and slumped on the sofa: "Really, Lao Bai, don't laugh. I have been around a lot, in the medical field, the entertainment industry, the Internet, and even in coal mines and iron mines, but I have never seen anything like this in the mobile phone industry!"

"It's not just us. There are tens of thousands of manufacturing factories across the province. Except for those that cooperate with foreign companies, all others are like this."

Bai Yongxiang withdrew his thoughts, smiled helplessly and persuaded in a complicated tone, the implication being that you still haven't seen enough.

Xie Jingxing was certainly not ignorant. In his previous life, ten years later, the industry was transferred to Southeast Asia for research. That was a real sweatshop, and he was so excited that he couldn't wait.

The question is what does Meizu want to do?
In the future, Huawei will hold high the banner of 90% localization of the supply chain, and the technological wolf warrior will be invincible; VO will settle in the third- and fourth-tier cities, focusing on the old men, the factory girls and the factory brothers.

There is no need to elaborate on Xiaomi, Apple, and Samsung, as each has a clear positioning.

Meizu cannot win by relying on 'design' alone, and it is difficult for it to even compete in the high-end market.

“‘Design’ itself is an abstract concept that cannot be seen or grasped like technology or sales channels, but we can give it exclusive brand value.”

Xie Jingxing sat up and supported his arm to give an example: "For example, humanistic care, environmental protection concept, can our overall brand positioning be better?"

"I personally feel that the demand for brand culture in the mid- and low-end markets is not particularly sufficient. Of course, Meizu has always been a company with dreams, but should our current focus be on 'integrating the supply chain'?"

Bai Yongxiang tactfully objected, saying that there was no need for Meizu to consider building a brand in its current situation. It would not be too late to expand the supply chain capacity first and then do other things.

"In 2007, Apple released its first smartphone, with an 'R' corner and a round home button that are still used today. During this period, each generation of products only needed to consider making the phone thinner, with a bigger screen and improved hardware equipment."

Xie Jingxing restrained his expression: "In other words, they had already thought about what the product they were going to make today would look like seven years ago. If the overall framework remains unchanged and minor modifications are made, it can be used for another seven years."

"14 years ago, or even earlier, Jobs had already thought about the future of Apple."

He said seriously: "If you don't have such determination and courage, then I will make the decision."

"I still insist that if we take action on the supply chain now, it will increase our procurement costs," Bai Yongxiang said solemnly.

Xie Jingxing did not argue: "Then keep your opinion, go call Li Nan and have a meeting."

Bai Yongxiang followed orders, and Meizu's finance, logistics, procurement, business, and other departments closely related to the supply chain were all controlled by Huang Zhang's relatives.

In the end, he had no seat on the board of directors. Apart from Xie Jingxing and Cai Chongxin, the other two seats were held by Huang Zhang's sister and brother.

As the largest external investor, company director and CEO, it is normal that Xie Jingxing's opposition to changes in the supply chain was ineffective.

Don't mess with me. I'm just a president who is a steward. I don't mean to offend you.

Bai Yongxiang had clear thoughts and secretly sighed for Li Nan who was smiling happily. He thought that the young man was too naive. How could he laugh at this time? He had to have a heavier mentality than going to a grave.

While thinking, I quietly took out my phone and sent a message: [Wife, cook some dishes for me tonight, I’m happy today! ]

"Mr. Xie, you're looking for me?"

On the other side, Li Nan couldn't hide his joy and smiled from ear to ear.

He has a work background in Japan and is a senior executive with relatively new ideas in the company. He has been in charge of marketing and has made great contributions to the financing negotiations.

Together with Bai Yongxiang, who is responsible for the company's daily operations, and Yang Yan, the chief strategy officer who is in charge of Meizu's operating system, they are known as the "Three Musketeers of Meizu".

But as for the internal situation, it can only be said that it was reasonable for the ancient emperors to not allow royal relatives to take power, and Huang Zhang himself was stubborn and disdained marketing.

As a result, he was restricted in what he did and had little room to develop his abilities. Finally, a big boss who focused on marketing and brand positioning came along, and he felt like laughing and crying at the same time.

"I heard that you came back from Japan, so you should have some feelings about environmental protection, right?" Xie Jingxing got straight to the point. Li Nan replied succinctly, "After seeing a very prosperous society decline, the public will agree with environmental protection from the bottom of their hearts."

"It's not an agreement, it's a lesson." Xie Jingxing held a different view.

The 1980s was a period of boom and bust for the Japanese industry, but after the bubble burst, two or three generations of Japanese people developed the habit of turning off the tap.

In his view, it has nothing to do with environmental protection, but with repaying an economic debt.

Xie Jingxing asked: "Two things. First, at the market level, is it feasible for us to officially implement 'old for new (mCycle)'?"

"It will definitely work!" Li Nan said without hesitation.

Bai Yongxiang couldn't sit still anymore, he stood up with the teapot in hand and started making tea. Xie Jingxing glanced at him.

At present, Apple has not yet implemented the trade-in policy, nor has it started to emphasize environmental protection.

There are many things involved. The simplest one is that unless the products recycled through trade-in are treated as electronic waste, it will be very challenging to the level of production and manufacturing.

In short, it’s still a cost issue.

"I am not good at the issue of how to cover the cost of 'trade-in' on the product production side, but there is a ready-made small solution from the market perspective."

Li Nan said in a daze: "Use recycled product parts to assemble second-hand refurbished machines, reduce costs through online sales channels, and sell them at a discount."

"Students, people with disabilities and other special groups can purchase the machines. Not only refurbished machines, but also official second-hand repair machines and after-sales return and exchange machines can be sold." Xie Jingxing added.

Follow Apple’s path and stay ahead of Apple.

Facts have proved that there is never a shortage of smart people in this world. They just happen to have the ability to execute their ideas. As for how well they are executed, it depends on the process.

"...Mr. Xie, this may not be as simple as we thought." Bai Yongxiang immediately planned to add some twists and turns and dramatic effects to the process.

"We'll have a meeting to discuss this later and pass a resolution on it by the board of directors. That's all I have to say for now."

Xie Jing Xing waved his hand lightly and continued to speak: "The second thing is that we need to build a brand."

This matter was agreed upon during the financing negotiations, and Bai Yongxiang and the other person concentrated on following the arrangements.

Currently, the company has two models, Meizu MX4 and Meizu MX4Pro, under development. The former uses MediaTek chips and focuses on cost-effectiveness.

It is expected to be launched in June, and the price is 200 yuan lower than Xiaomi. We will lose money on each unit sold. The purpose of this game is to have fun even if you are poor. No matter you win or lose, let's just compete with the benchmark.

The latter uses new technology and new configuration, and is expected to be released by the end of the year, with a price of around 2500 yuan.

Xie Jingxing and Alibaba were not very satisfied with this. They thought their vision was too narrow. They would lose money by competing with Xiaomi. If they were to compete, they should compete with Redmi.

Establish a new sub-brand focusing on low prices and enter the market of RMB 1,000 and below.

As a result, the 'Meizu MX' series is positioned in the 2000 yuan mid-range market, the 'Meizu MX Pro' series aims to develop into the 3000 yuan high-end market, and the new sub-brand occupies the 1000 yuan low-end market.

"The new sub-brand is tentatively named 'Mei Lan'. I need two series of products. The price of the 'Mei Lan S' series will be around 100 yuan."

Xie Jingxing raised two fingers: "Also based on this, we can enlarge the screen to make the 'Mei Lan Note' series, and the price will be capped at one thousand."

"The brand concept is defined as - quality products for young people, making high-quality mobile phones for young people at a price of hundreds or thousands of yuan."

He paused and looked at Li Nan: "You are the CEO of the sub-brand. The first three products are not required to be profitable. The goal is to lose money. At least lose 5 million yuan a year."

"Just the shipment volume?" Li Nan was confused and pointed out the truth.

The five-year average annual shipment volume of 1600 million units is written into the Taihe-Ali performance betting agreement, which is also the three-year agreement between Xie Jingxing and Huang Zhang.

Given Meizu's current poor supply chain level, it is questionable whether it can produce 8000 million mobile phones even if it runs at full capacity for five years.

Therefore, he had to find another way and manufacture low-end and cheap mobile phones, on the one hand to seize the market and on the other hand to lower the technical requirements on the production side and decentralize the supply chain to expand production capacity.

"Dong dong dong."

Xie Jingxing knocked on the table and emphasized: "Environmental protection concepts and youth quality products are only part of our branding. The most important thing is that we must understand that we are building a brand that is different from all other competing products."

"Li Nan, you should know what the foundation of branding is. Value proposition and aesthetic pursuit are both indispensable."

He tilted his head to look at Bai Yongxiang: "With Mr. Huang here, I am not worried about our aesthetic pursuit at all. So how do we reflect our value proposition?"

The problem goes back to the starting point. He must integrate the supply chain and start with Huang Zhang’s relatives.

Li Nan came back to his senses and lowered his head unconsciously. Nervousness overshadowed his excitement, and sweat oozes from his palms that rubbed against his pants.

Bai Yongxiang hesitated to speak several times. The so-called brand is a very general concept.

When people mention luxury goods, the first thing that comes to mind is LV, a brand. When they think of red wine, the first thing that comes to mind is the 1982 Lafite, a brand. When people laugh at Zuanlinzi Photography, except for Nikon guys, it is also a brand.

Third-rate companies make products, second-rate companies build brands, and first-rate companies set standards.

The essence of this sentence is that building a brand and setting standards means having the ability to reap profits at a high premium in a niche industry, and having countless consumers flock to buy into it.

There was only one brand in the mobile phone industry, Apple, but ten years later, there was one more company, Huawei, which also started out by leveraging technology and taking advantage of the national thought dividends of the rise of a great power.

It has created a brand effect of "the pride of domestic products" and its technology is so strong that it can set industry standards. Therefore, it can sell its products at a price of more than 5000 yuan, truly entering the high-end market competition and reaping the brand premium.

Even so, there is still a long way to go to catch up with Apple, and the value of the brand is obvious.

Bai Yongxiang doesn’t know what Huawei will be like in ten years, but he definitely thinks that the two words “Meizu” can give his products a 30%-50% premium.

However, Xie Jingxing not only wanted to sort out the supply chain and expand production capacity, but also used brand strategies such as environmental protection as an excuse to completely integrate the supply chain and liquidate Mr. Huang's relatives.

"Okay, I'll make the decision."

Xie Jingxing shrugged with a dull look on his face: "I have considered a lot about the brand, but the prerequisite for all this is quality. Quality comes first and then brand."

No matter what Bai Yongxiang was planning, Huang Zhang had already agreed, so just assume that he agreed.

After all, there is no business in the world that lets the horse run without giving it grass to eat. The agreement to achieve half of Xiaomi's shipments in three years is in front of him, and Huang Zhang has no reason to complain.

(End of this chapter)