Smartphone brand OnePlus is out to disprove the stereotype that China equals cheap and shoddy
OnePlus has catapulted to top position in the US for open market sales of US$400-US$600 models, with a 44 per cent share
The press invites were printed and about to be mailed and more than 200,000 of OnePlus’s latest smartphones had come off the production line when founder and chief executive Pete Lau told his team he was postponing the early-May launch until he was satisfied with a photography feature.
“You can imagine the amount of disruption that decision caused and the ripple effect it had on the entire marketing and supply chain,” Lau, 43, said over dinner with the South China Morning Post in Beijing earlier this month.
“But you only get one chance to get the initial impression right. Disappoint your supporters even once and the trust that you have built up for years evaporates immediately.”
Lau had slept for just four hours the night before his interview, we were told, and was making changes to his presentation script up to the last few minutes and had not had a thing to eat all day. “Our team didn’t sleep at all,” he shrugged, when asked about the late night. “I at least had some sleep.”
Lau had just come from a series of media interviews promoting the OnePlus 6, and has changed out of the two suits he wore during the presentation and into a more comfortable open-necked shirt for the dinner at an Italian restaurant near his hotel.
Throughout the two-hour dinner, Lau often circled back to the idea of “benfen”, which loosely translates to “integrity” in English, but also speaks to the idea of doing what’s right. It’s a sort of moral code that he adheres to and guides the decisions made at the four-year-old company, which has garnered legions of fans globally.
Lines formed for OnePlus’s products in the way that you typically see at Apple launches. The Shenzhen-based company’s smartphones have become a sort of must-have for techies ‘in the know’ worldwide who appreciate its value-for-money performance. Its e-commerce shipment records show that its US buyers come largely from three technology companies – Amazon, Facebook and Google – according to Lau.
“In very simple words, benfen means we should be honest to the consumers and fulfil our commitment to them. We should not take advantage of anyone” including our suppliers and business partners, and we should even not fool our employees but treat them in a genuine way,” he said.
At OnePlus, employees who resign are given the same severance package as those who are asked to go. “It’s just illogical to me that we’re not giving the same terms to those who have served us well and are moving on for reasons like family issues, when we pay those we ask to go,” he said.
The same kind of understated, down-to-earth logic extends to product design.
The OnePlus 6 sports the latest Qualcomm Snapdragon 845 processor, a choice of 6-gigabyte or 8GB of RAM, as well as a 3,300mAh battery with fast-charging technology. The handset starts from 3,199 yuan (US$503) in China while an Avengers edition of the phone costs from 4,199 yuan. The base model starts at a slightly higher price of US$529 in the US.
The smartphone comes in three designs – two versions in black and the other in white – because research shows “most of the sales are of black and white”.
There is no wireless charging because it is slow and users cannot do much once the phone is placed on a charging pad. The OnePlus 6 also does not feature industry-leading waterproofing because “you’re not going diving with it.” The smartphone works fine in the rain and can even play music in the shower, Lau said.
The OnePlus 6 “feels really good in the hand” and “strikes a great balance between screen size and handset size, with a huge screen housed in a body not much bigger than previous OnePlus phones”, according to an unboxing video by Abacus, a China-focused consumer tech website.
Tech review site Engadget gave the OnePlus 6 a rating of 91 out of 100, saying “the reasonably priced powerhouse now comes in an elegant package”. CNET and The Verge rated it 8.5 and 8 out of 10 points, respectively, pointing out the lack of full waterproofing and the fact that it is not compatible with CDMA carriers like Verizon and Sprint in the US.
In China, the OnePlus 6 sold 100,000 units in 12 minutes through various channels including its official website and JD.com, the e-commerce retailer. Sales topped 100 million yuan in 50 seconds after the start of online sales, the company said on May 22.
As far as tech product launches in China go, the OnePlus 6 was a tame affair. In March, Cheetah Mobile chief executive Fu Sheng was halfway through talking about steering the app company into hardware at Beijing’s Water Cube when he dived into and swam a length of the 2008 Olympic Games swimming pool.
Smartisan, a Chinese smartphone company started by Luo Yonghao, has created a cult following because of its Apple-bashing rhetoric.
Lau smiled politely when told of the Cheetah and Smartisan launches but declined to be baited into criticising his peers in the tech industry. The media’s only non-product references were positive remarks about his tailoring – he had told the audience he had never dressed so formally.
Still, Lau wants “more people to understand OnePlus” while still being low-key, which he admits is a contradiction.
Lau worked as vice-president at Chinese smartphone brand Oppo before he established OnePlus in late 2013. Oppo, currently the second-largest smartphone brand in China after Huawei Technologies, remains a major stakeholder in OnePlus.
OnePlus is a rarity among Chinese smartphone brands in that it derives almost 70 per cent of its sales from outside the mainland, with the US, Europe and India among its biggest markets.
In the US, it is the No 1 smartphone vendor in the US$400 to US$600 range open market – sold without bundled telecommunication carrier contracts – with 44 per cent of the market share, followed by Motorola at 16.7 per cent and Apple at 10.9 per cent, according to IDC research figures provided by OnePlus.
OnePlus also leads in the above-US$400 category in the online sales market in India with a 50.5 per cent share, according to the IDC research, ahead of Apple and Samsung. India is the world’s second-largest smartphone market, one that is fiercely contested by Chinese brands including Xiaomi.
OnePlus’ popularity in overseas markets, especially in the US, is because of its targeted user engagement model, said Bryan Ma, vice-president of devices research at IDC. The company is now officially in 35 markets around the world, with more than 900 employees from 21 nationalities, according to OnePlus.
“Like Xiaomi, they cultivate a fan base through user engagement forums and events, and use that feedback in developing their products. Likewise, OnePlus is targeted at tech-savvy Android users who particularly value OnePlus’ clean builds and fast performance,” Ma said in an email.
OnePlus is in talks with US carriers, Lau said. The US market is currently the third-largest globally after China and India but is dominated by network carrier sales, which account for more than 90 per cent of all smartphones sold in the country.
“We need to establish our presence and earn a good reputation in the US first to give us more bargaining chips when negotiating with local carriers,” Lau said. “I believe now is the best time, and our products will be available at US carriers from 2019 at the earliest,” he said, without being more specific.
Even with the initial success, Lau said he has to fight the stereotype that Chinese brands offer cheap and shoddy goods. That is why he will not be pressured to expand the product range or step up the frequency of new models.
“We want to ensure that we concentrate on offering the best phone available on the market all the time.”