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AU News A Letter from the President of Honor
December 29, 2017

A Letter from the President of Honor

Honor’s Happy New Year! Mapping Out a Wider Victory with Plans for China Consolidation and Global Expansion


Dear Honor fellows,

The year of 2017 is coming to an end. We thank you all for your creativity and pioneering work throughout the year. We have not only successfully reached our annual target but also accomplished a series of remarkable achievements. Here, I would like to take this opportunity to express my deepest gratitude to every Honor user, staff, and partner all over the world!

George-Zhao.

Greatness comes from brave beginnings. Looking back over the past four years, Honor has never hesitated, despite the numerous challenges and fierce competitions we faced. We have a humble heart, but we never limit ourselves; we respect the rules, but never confine ourselves. That is how Honor has become an unstoppable force and accomplished a remarkable success along the way.

Throughout the year of 2017, the smartphone industry continued to be in a downturn and there are undercurrents in the competitive landscape. We’ve seen brands who are struggling, brands who are hitting the bottom, and brands who are fluctuating. For Honor, however, the year of 2017 was the time of steady growth, further development, and acquiring victory. According to Sino Market Research, Honor had crowned the smartphone online market in China in terms of both sales volume and revenue between January and November 2017. In November alone, Honor was the bestselling Android phone in China; during Singles’ Day sales, Honor had again crowned the smartphone market with over RMB4.2 billion (approximately US$613 million).

2017 was the year when Honor launched the most new products. It is also the year that Honor presented its accumulation in R&D capability. We are exploring the industry more deeply every-time a new product is released: Honor V9 (Honor 8 Pro in overseas markets) redefines the performance of flagship phone; Honor 9 exemplifies the pursuit of aesthetics; the full-view display of Honor 7X allows affordable phones to equip with flagship user experience.

On the date of November 28, the epoch-making Honor View 10 came into being, formed by our utmost efforts in various areas, including chipset, software, camera, display, audio and so on. I believe that AI smartphone will not only be the next breaking point for Honor, but also the breaking point and milestone for the whole smartphone industry.

Honor’s global journey, diving deep into key markets in 2017, has achieved extraordinary breakthroughs and largely improved our competence for future challenges. It is noteworthy that in Russia and Finland, Honor became one of the top three in terms of market share through January to October. We have also seen a record increase of over 100% sales growth on Amazon during its Black Friday sales season in France, Germany and the United States.

We are thankful to receive such great results, and we are faithful in all the appraisals we receive. In 2017, the average satisfaction rate of Honor’s products has reached 98% from consumers, some of them have even recorded 100% satisfaction rate. This data reaches far beyond just numbers. Behind each of the favorable comment, there is a youngster who has high expectations on Honor. We highly cherish these honors credited to us, they embody the hard work of all Honor people and the love from all Honor users.

Furthermore, utmost gratefulness to the support of Huawei Group in every crucial decision Honor made this year. Same thankfulness also to the great help from 2012 laboratory, Hisilicon, R&D department, supply chains, and other departments. Honor’s growth and improvement perfectly exemplifies the strong competitiveness endorsed by the entire Huawei unity.

Thank you for all your support and love.

Honor’s development in 2017 has outperformed market expectations. To us, this is a predictable outcome as Honor’s strategic directions has always been firm and consistent. We never deviate from our strategic directions or blindly follow a so called “hot trend” which could be temporary and short-lived.

Honor has demonstrated sharp observation capability in predicting the trend of smartphone industry from 2014 to 2017. We have always adhered to the core value of creating values for users, and developing edgy technology products for young people. At the same time, we will be dedicated in the offering of quality, technology innovation, and services, while sticking to the Internet-centric and light asset business model, together with the integration of online and offline sales, and continuing to work closely with our partners.

In a sense, it is the strategic confidence and strong execution that brings Honor great success. It is also our asset for the future. It is the fundamental reason of Honor’s crowning of smartphone online brand in China and the birth of Honor’s industry-leading AI technology. Without the solid strategy and execution as the foundation, Honor couldn’t make bestselling products or reputable brand image, and would not be favored by millions of consumers.

We have a concrete understanding of this world in 2017 and we want to embrace the world more fully in 2018.

Looking into the future, Honor has a crystal-clear strategy, that is to develop both domestic and overseas markets. At the fourth-year anniversary of Honor, we announced our global strategy. Honor will focus on standing on high grounds, and covering large, densely-populated regions, including the United States, Europe, Russia, Africa, Turkey, India, Indonesia and many more as the key areas for development. And we will rely on an Internet-centric and light asset business model to become one of the top 5 in the next 3 years in the global smartphone market. And we will aim to increase the proportion of overseas sales to 50% by 2020!

Now, we march out bravely in 2018, facing towards the vast global market.

This is by no means an easy journey. We are not only facing a wide variety of competitions and different market landscapes, but also the challenges of cross-cultural communications. We had mapped out our strategic path in the past 3 years, while it may take others 10 years or more. Meanwhile, in the domestic market of China, we are facing a higher degree of industry concentration, with fiercer competitions and declining broad market value. To be honest, what is waiting for Honor in our road ahead is not only opportunities, but also huge challenges.

After four years of Honor’s birth in China, the go-global move now is our second entrepreneurial initiative.

Starting a business is never easy. Our real challenge is how to create the unique “Honor-model” of development in overseas markets, and at the same time to create the valuable and reputable development.

At present, there are two mainstream models of development for the smartphone industry in the overseas market: one is to gain overseas market shares by offering inexpensive and low-quality products, most of which sacrifice the brand reputations and future; the other model is commonly adopted by the top international giant brands which is to carry out a step-by-step approach and long-term strategy. But none of these models is for Honor. Unlike other brands, Honor dares to uphold the Internet-centric and light asset model, and be dedicated in technology innovation, product quality, and services, becoming the trendsetting and beloved brand by young generation. We will also join hands with our global partners, integrate online and offline channels, and build a solid win-win ecosystem for all.

At this moment, Honor’s biggest desire is to have these capable and courageous talents to be where they are mostly needed.

Here, I would like to extend my gratitude to the parent group and Huawei Consumer Business Group for their great support of Honor’s global strategy. Not only is the global “Huawei and Honor” dual-brand strategy made clear, but also allows autonomy in Honor’s development. The global business is directly operated by Honor’s business department, and is supported by the unprecedented strength of human resource and incentive mechanism.

2018 is a crucial year with historic mission and milestone significance. We are facing unprecedented pressures when going global. We pursue growth, but more importantly a healthy growth. We must adhere to the strategic confidence, comply with the local laws and regulations, and respect the local cultures. We have to strengthen our core advantage, while safeguarding the bottom line.

We lived up to the expectations over the past 4 years, and we need to step it up to the next level for the next 3 years. In 2018, every Honor-er must attain a persistent belief, not to reminisce the past nor to fear the future.

“Change the world, but don’t be changed by the world” —- is the mission of Honor and that all of us should strive to achieve. Let us all to join hands together and place our footprints in every corner of the world in the new year!

Let’s keep it up, achieve our goals together, and fight side by side!

George Zhao
President of Honor
2017.12.28