PROMOTION CIRCLE: Hisense Ferris Wheel lights up Cape Town

If you were lucky enough to be in South Africa to watch the World Cup, you couldn't have missed the Hisense Ferris Wheel, a 50-meter-high landmark, close to Cape Town's Green Point Stadium. The "Hisense Wheel of Excellence" overlooks one of the world's most beautiful cities and its 36 luxury sightseeing carriages, equipped with the latest Hisense LED televisions relaying high-definition action from the football extravaganza, made for an unforgettable experience.

Away from the football and the coast, Hisense is making its presence felt in the country's interior too. From TVs in Gold Reef City in Johannesburg and the administration center in Pretoria to nationwide advertisements on buses, in local media, and billboards on highways, Hisense is on the march down south.

Innovation rules

About 13 years ago, Hisense was virtually unknown in South Africa. Now, the big name in household electronics from China has forged a path on the international market, thanks largely to its localized branding strategy.

When the company entered the African market, a potential customer asked if Hisense could design an optical sensor, which adjusts the brightness of TV sets according to the amount of light in the room. The Chinese household electronics giant quickly modified the existing design to satisfy the customer's needs. The move helped Hisense to break into the local market.

Since its breakthrough, Hisense has stood by its belief that development of an overseas market relies mainly on technological innovation and quality, rather than acquisition. "Overseas acquisition must be based on a company's needs and development strategy. For Hisense, innovation is more important," says Guo Qingcun, Vice President of Hisense.

This means a big focus on developing its own technologies. In 1997, Hisense set up its first overseas manufacturing base in South Africa to develop products for local consumers. It now purchases about 50 percent of its production materials locally. Over 90 percent of Hisense's staff are South African and it has sustained an annual sales growth of around 30 percent.

Putting priority on brand building helps the home appliances maker win more customers and make more sales. The total sales of Hisense SA Development Enterprise (Pty), Ltd. (Hisense SA) from February to May this year were up 70.8 percent from a year earlier, with sales in LCD televisions up 185 percent and refrigerators 288 percent.

When first tapping into the unfamiliar African market, Hisense was facing many difficulties. Searching for a way forward, former Hisense SA General Manager, Yu Youhai, and his team visited shopping malls and chain stores in Johannesburg, chatting with on-the-ground sales people in order to understand the market. They also invited managers from major chain stores to visit Hisense headquarters in China. They later developed a strategy targeting middle-tier consumers with their high-quality, low-price household appliances, and avoiding head-on competition with international brands.

All their hard work has paid off. Not only are Hisense products on the shelves in more than 2,400 South African chain stores and 500 electronics retailers, they have also been exported to neighboring countries, including Mozambique, Botswana, and Namibia. Data from research firm GFK shows that Hisense has secured a share of about 10 percent in the South African television market, and over 5 million households are using this Chinese-made product.

Hisense SA intensified its branding campaign during the World Cup, making full use of existing social networks and online marketing to increase brand awareness. Apart from the ferries wheel and in-store displays, the television manufacturer set up 20 outdoor 3D billboards, the first such billboards in Southern Africa. The company also placed 3D advertising in one of the country's high-profile digital lifestyle magazines. And it has turned to social networking sites like Facebook and Twitter: Over 1,000 users have signed up to the Hisense social sites so far.

Brand consultant praised such move, saying that being able to access consumers through Internet and social network sites are a potential boon to Chinese companies in overseas markets. Jonathan Chajet, Managing Director of global brand consultancy Interbrand China, thinks new communications technologies could bring forward the day when China has its real global brand.

In return, the new marketing strategy has fueled another wave of consumption on televisions. "Early in April, all 200 42-inch LED TV sets were sold out within 3 hours," said Guo Bin, Hisense SA Marketing Manager. "The 47-inch and 55-inch LED screens have also sold well."

Before the World Cup, first batch of Hisense giant screen 3D TVs featuring the latest technology had been pre-sold while 30 additional orders had come in. "The presale [of Hisense products] hit a record high between June and July," Guo added.