Evaluate the role and importance of marketing within an organisation of your choice?
Introduction
Huawei Technologies Co. Limited is a Chinese multinational company that trades in network
communications and telecommunication equipment production and services. It’s based in
Shenzhen in Guangdong province. It’s currently the leading company in telecommunication
equipment production globally after acquiring Ericsson in the year 2012.
In 2013, Huawei registered a sales turnover of $39.4 billion US dollars which represented an
increment of 11.6% with a Net profit of $ 3.4 Billion US dollars. Over 65% of its revenues are
earned in markets outside of China which actually was an improvement from the previous year
where 86% of its sales turnover was outside China. It has over 140,000 employees in over one
hundred and forty countries worldwide. About 46% of the workforce is engaged in research and
development activities. In the year 2013, Huawei invested over $5 billion US dollars in R & D
operations.
Huawei has majored in three core businesses a) Telecom Network carriers, building and services
b) Developing software’s for schools and providing services and equipment c) Manufacturing
electronic communication devices.
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To promote its products and services, Huawei sponsors several activities that promote its social
corporate image as well as its product brands. In 2013, Huawei sponsored Borussia Dortmund
club in the German Bundesliga as well as the Liga de Fut’bol, the Spanish football league. These
clubs don the Huawei branded t-shirts that bore the brand of its products. Huawei also sponsors
the Paris Saint-Germain, Bangalore Royal cricket Challengers and Ghana’s Black Stars.
(Chang, Cheng, Kim, Osius, Reyes, and Turgel, 2009) Huawei’s promotional strategy has
been influential in promoting its products in the global market by informing, persuading as well
as influencing the decisions of its potential clients internationally. Its major objective was
initially to promote as well as develop its key products primary market demand. Different
companies adopt different promotional strategies depending on the nature and industry of their
products. Huawei adopted the pushing strategy where its products are aggressively marketed
through new marketing processes or channels. Its marketers believed that creation of a strong
demand will ultimately compel the global market forces or intermediaries to finally
accommodate it. (Kotler & Armstrong, 2010)
The pulling strategies are utilized in marketing communication to generate the general consumer
demand through sales promotion, advertising and other marketing appeal strategies. (Smith &
Taylor, 2004)
Product positioning involves the development of the products brand as the real images of the
firm’s products or services. Several elements of the marketing communication strategies may be
required to form an impressive strategy. These strategies explain the uniqueness and the
competitive nature of the company’s products together with its own perceived advantages against
its closest competitor. Branding is utilized and applied as a tool to design and place the product
in the market by carefully packaging it to capture the attention of potential clients who picture
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the product as an epitome of success which also influences its pricing policy. This process is
known as brand equity and it occurs mostly where the clients are even willing to pay slightly
much more to obtain the product largely due to its position in the market. For example the airline
industry spends a considerable amount of its advertising and marketing expenses in branding its
services like the Royal class, executive or deluxe business class. These services attract
considerable amount of extra charges that are payable because of their brand and positioning.
(Kotler, Keller, Brady, Goodman & Hansen, 2012)
The nature of the Huawei market is such that most of its sales are made outside of its home
country. Huawei situation demands a very competitive marketing strategy in order to
compete with other international firms in the world market. These strategies will assist its
own products to penetrate the global market and to establish their own customer loyalty for
their own brand of telecommunication equipment and network facilities and devices. The
high research and development expenditure helps in customizing the client’s demands by
identifying their needs and tastes.
To convey the necessary information about the company’s products, Huawei has
segmented the market into three categories, the network devices, software and services
and electronics. In network devices, Huawei has partnered with various companies like
Siemens, Motorola and Nokia in their research and development activities to produce
competitive products in the market. In 2014, Huawei targets to increase its penetration of its
key ultra-broadband mobile device known as the LTE, a smart device that is intrinsically a
necessity in the transformation of the IT systems in the digital world. Huawei also targets to
advance its software and other consulting services in to other emerging global markets.
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The Huawei Ascend Smartphone’s has been branded by the company’s white label
products which also produce the IDEOS brand of phones, wireless modems, gateways and
other video products.
Dividing the market into segments has assisted Huawei to effectively market the branded
products in specialized markets internationally. Segmentation concept classifies the market
into specific services or products which allows effective communication in the company’s
marketing strategies. (Lemon & Mark 2006)
The objective of market segmentation is to improve the overall efficiency in the company’s
marketing activities by actually narrowing the entire market towards a restricted, defined and
designated segment that is basically consistent with the characteristics and demands of that
particular segment. Market segmentation results in general product differentiation particularly
from the company’s rival products and other competitors. Huawei’s products in the market have
a comparative advantage in the market because of their effective marketing strategies and global
presence in almost every major city in the world. (Wood, 2003)
In 2013, Huawei published its SoftCom network architecture that facilitated the development
of the ICT convergent devices and solutions. It was a distinctive, well branded and creative
advertising strategy that generated impressive results universally that ensured that its
branded products were successful in the global market. The advert designers tailored the
adverts according to the needs and also the tastes of the customers whom they constantly
referred to customize their needs in some of the company’s products and devices.
Informative advertising strategy is a concept that aims to create and also to build the initial
or primary demand of a new product in the market. Its commonly used during the
introductory stages or the products life cycles while persuasive advertising is applied in the
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last stages of a products life cycle and it aims at improving the products competitiveness in
the market.
Finally, Huawei is still expanding while the ICT sector is also booming. The connected world
has also unlocked other global opportunities and higher potential for steady growth for the
company. Huawei has remained focused and it’s strategically placed even for greater expansion
in future.
References
Blythe, J. (2008) Essentials of Marketing, 4th Edition, Essex; Pearson Education Limited
Chang, C., Cheng, A., Kim, S., Osius, J.K., Reyes, J. and Turgel, D. (2009) “Huawei
Technologies: A Chinese Trail Blazer in Africa” . Business Today
Kotler, P. & Armstrong, G. (2010) Principles of Marketing, 13th edition, London: Pearson Education
Ltd.
Kotler, P. & Keller, K. L. & Brady, M. & Goodman, M. & Hansen, T. (2012) Marketing
Management. 2 Ed. Essex: Pearson Education Limited.
Lemon, K. N., & Mark, T., 2006, Customer lifetime value as the basis of customer segmentation.
Journal of Relationship Marketing, 5(2), 55-69.
Smith, P.R. & Taylor, J. (2004) Marketing communications, an integrated approach, 4th edition.
London: Kogan Page Limited.
Wood, M. (2003) The Marketing Plan: A Handbook. New Jersey: Pearson Education Inc.
