Pop tech: Will the Pepsi branded smartphone for China be a fizzer?

After huge flops by Facebook and Amazon, beverage brand tries similar approach by lending name to handset; Wang Feng Technology rumoured to be local partner

PUBLISHED : Friday, 16 October, 2015, 1:42pm
UPDATED : Friday, 16 October, 2015, 7:14pm

Pepsi plans to unveil its "Pepsi P1" smartphone on Tuesday with a retail price of US$205, according to media reports 

New York-based PepsiCo, which owns about 14 food and beverage brands that generate US$1 billion or more in annual sales, confirmed on Monday that it would be releasing a smartphone in China "in the coming months".

However it stopped short of naming its Chinese partner or publishing any images of the handset, which spurred a series of speculative mock-ups on the web featuring the company’s iconic blue-and-red logo.

“Pepsi has always moved at the speed of culture, and today technology is a key cultural pillar at the heart of consumer interaction,” the company reportedly told foreign media.

It added that it has no plans to manufacture smartphones but remains "committed to engaging with consumers in innovative ways to grow our brand”.

It was unclear whether the drinks giant plans to collaborate on one or a series of smarthphones.

Some believe the unnamed partner may not be one of China’s growing army of smartphone vendors - Xiaomi, HTC, Meizu or Taiwan’s ZTE, to name a few - but rather a smaller company based out of Shenzhen in Guangdong province called Wan Feng Technology.

The company, which specialises in making licensed smartphone products and accessories such as FIFA World Cup phone cases and a previous Hello Kitty smartphone, created an account on microblogging site Weibo, often dubbed China’s Twitter, in October called Pepsi Phone.

The account, which has been verified as real by Weibo, posted earlier this month that it would be making a “big announcement” on Tuesday of this week.

But the account was suddenly taken down late last week with no further explanation given.

In a recent interview with China National Radio (CNR), the company’s CEO Yang Tao said the new Pepsi smartphone would retail in China for between 1,000 yuan and 2,000 yuan (US$157-$314).

“I cannot reveal any more details as this requires permission from Pepsi’s headquarters,” he was reported as saying.

Other reports claim the device will have mid-range specs, a 5.5-inch display, a 1.7GHz processor and 16GB of internal storage.

Pepsi said this week that is has been working with a licensing partner to bring the phone to China “in the next few months”, Reuters reported.

"We forecast Pepsi to capture less than 1 per cent of China's smartphone market in 2016," Neil Mawston, the executive director for global wireless practice at research firm Strategy Analytics, told the South China Morning Post.

This would not be Pepsi’s first foray into lending its name to a smartphone or other retail items like apparel.

It also comes on the heels of two massive flops in recent years by other multinational brands that have tried to use smartphones as a kind of marketing gimmick to ramp up their appeal among tech-savvy young consumers.

Amazon released its first-ever smartphone, the Fire Phone, amid much fanfare from CEO Jeff Bezos last year, but the device was soon panned for lacking popular apps like Google Maps and - with an off-contract price of US$650 - blasted as simply not being worth the money.

Despite its 4.7-inch screen and Qualcomm Snapdragon 800 processor, sales were sufficiently bad to prompt US carrier AT&T to drop its price from US$200 to just 99 cents with a two-year contract.

Facebook had a comparably bad run in 2013 when it worked with China’s HTC to produce The First, often billed “the Facebook phone”.

Consumers were left wondering why they needed a phone dedicated to Facebook Home when rival devices also offered this but with better specs and prices. The model’s disappointing 5MP camera was for many the nail on the coffin.

Pepsi will be hoping for better luck with its upcoming release, which many pundits have interpreted as more of a promotional exercise than anything else.

The company collaborated with Chinese smartphone make OPPO last year to bring a special-edition smartphone to the Chinese market but its contribution amounted to little more than lending OPPO the use of its name and logo.

Yet interest in the new device has been sparked as more companies enter the smartphone field despite having little or no experience in consumer technology.

Gree, a Chinese manufacturer of home electronics known for its air conditioners, announced in June that it was about to release a smartphone priced at 1,699 yuan.

Chinese multinational Sany Heavy Industry has also added a water - and shock - proof smartphone to its product line of concrete mixers and coal-mining equipment.

Even Chinese celebrities are getting in on the act.

Li Yang, creator of the English-education brand Crazy English, has produced his own so-called Crazy Phone.

Wang Zijian, a Chinese entertainer, comedian and popular talk show host, said last month he would soon be releasing a smartphone, without providing details.