A New Paradigm for Chinese Businesses Going Global: How OPPO Builds "Local Brands"

A New Paradigm for Chinese Businesses Going Global: How OPPO Builds "Local Brands"The 2024 Government Work Report explicitly states the strategic goals of "cultivating more 'Made in China' brands with global influence," "building more world-class companies," and "supporting businesses in exploring diversified markets." This policy not only provides strong support for the globalization of Chinese companies but also signifies a profound shift in the role of Chinese companies in the international market

A New Paradigm for Chinese Businesses Going Global: How OPPO Builds "Local Brands"

The 2024 Government Work Report explicitly states the strategic goals of "cultivating more 'Made in China' brands with global influence," "building more world-class companies," and "supporting businesses in exploring diversified markets." This policy not only provides strong support for the globalization of Chinese companies but also signifies a profound shift in the role of Chinese companies in the international market. Against this backdrop, Chinese companies going global, represented by OPPO, BYD, Haier, etc., are jointly pushing Chinese companies' globalization into a new stage, shifting from pursuing scale to high-value development. Taking OPPO, a smartphone company with over a decade of continuous deep cultivation in the industry and 15 years of experience going global, as an example, we can explore the new trends in Chinese companies' globalization.

OPPO's new stage of globalization is firstly reflected in the continuous expansion of its global market footprint. Starting in Thailand in 2009, OPPO embarked on its globalization journey. In 2013, OPPO expanded into Southeast Asia markets using Indonesia and Vietnam as breakthroughs; in 2014, OPPO entered India and other countries. In 2018, OPPO stepped onto European soil, and then in 2020, it landed in Latin America. As of 2024, OPPO's presence can be found across five continents, covering more than 70 countries and regions worldwide, with over 300,000 retail stores globally. It has independently established over 3,300 offline after-sales service stores. Its overseas shipment ratio has reached approximately 60%, making overseas operations a key growth engine for OPPO's future. On October 24th, OPPO officially launched its new generation of imaging flagship smartphone, the Find X8 series, and announced its global launch, with sales in multiple countries and regions including Asia Pacific, Europe, and Latin America. As OPPO's annual imaging flagship, the Find X8 series integrates the latest technologies in imaging, AI, and others, representing OPPO's latest paradigm of continuous innovation and unwavering commitment to product excellence.

Besides the expansion of its global market footprint, OPPO's new stage of globalization is also evident in the increase of its global market share. According to IDC, global smartphone shipments grew 4.0% year-on-year to 316.1 million units in the third quarter of 2024. OPPO, with a market share of 9.1%, secured a firm position as the fourth-largest player globally. Data from Canalys also shows that OPPO ranked first in Southeast Asia in the second quarter of 2024, specifically taking the top spot in Vietnam, Thailand, and Cambodia, and ranking second in Indonesia. In the Western European market, OPPO holds the second position in Portugal, third in Finland, and fourth in Spain. In the Latin American market, Canalys data reveals that OPPO's shipments in Mexico reached 1.9 million units in the first half of 2024, a year-on-year increase of 16.5%, marking a new historical high for OPPO since its official entry into the market in 2021. In the second quarter of 2024, OPPO's market share in Mexico reached 11%, securing the fourth position.

Beyond the increase in market share, a more significant aspect of OPPO's new globalization stage is its successful positioning in high-value markets. Canalys data indicates that OPPO ranked among the top three in the over $500 price segment in 14 countries, including India, Thailand, Vietnam, New Zealand, Belgium, and Portugal, in the second quarter of 2024. The Find X series, OPPO's high-end product line, continues to see rising popularity. Its shipments grew by a staggering 98% year-on-year in the first half of 2024 compared to the previous generation. Furthermore, Canalys data shows that OPPO achieved a 19% market share in the $500-799 price segment in the Mexican market in the second quarter of 2024, ranking second in this segment. These data clearly demonstrate OPPO's competitiveness and influence in high-value markets worldwide.

OPPO's ability to achieve such remarkable success in the global market lies in its consistent adherence to the "best globalization is localization" methodology. To this end, OPPO has established a complete production, sales, and service system globally.

• In production, OPPO achieves supply chain diversification and localization by establishing production bases worldwide, reducing production costs and risks.

• In sales, OPPO achieves localized and diversified sales channels by building close partnerships with local operators, retailers, and other collaborators.

• In service, OPPO establishes a vast after-sales service network worldwide through both self-construction and collaboration, providing convenient and efficient after-sales service to customers.

OPPO's Chief Product Officer, Liu Zuohu, expressed, "Through products tailored to local user needs after understanding them, capillary-level services, respect and protection of local culture, empowerment, and care for local employees, users in overseas markets feel that OPPO is a local brand, not an outsider."

As Hong Kong's Institute of Entrepreneurship and Innovation Director Cao Yangfeng commented on the implications of OPPO's globalization strategy for Chinese companies going global, he pointed out that OPPO, starting its globalization journey in 2009, achieved global smartphone sales exceeding 100 million units by 2023, securing a 9% global market share and ranking fourth globally, becoming a paradigm for Chinese smartphone companies implementing globalization strategies. Analyzing OPPO's entire globalization journey and strategy, Cao Yangfeng believes that at least three aspects offer valuable lessons for Chinese companies expanding their operations overseas.

First, uphold the "global localization" strategy. This has been OPPO's unwavering "grand strategy" throughout its globalization journey. This strategy effectively integrates the advantages of "globalization" and "localization." It leverages the different resource endowments of various countries to build a value-creating network that spans the globe, enhancing value integration capabilities, and simultaneously adapts to the unique market characteristics of each country, promoting localized operations. This makes OPPO feel like a "local brand" to overseas users, adopting a "one country, one policy" approach to boost operational efficiency and agility.

Second, persist with the "user-centric" innovation strategy. OPPO views understanding and meeting the real needs of consumers in local markets as the source of innovation. It continuously optimizes product functions to continuously improve "product power," utilizes precise marketing to consistently strengthen "brand power," and ultimately creates "hit products" recognized by consumers.

Third, maintain a "steady progress, adapt to local conditions" strategic rhythm. OPPO's international journey started in Southeast Asia, treating gaining the market in the Asia-Pacific region as a launchpad for globalization, applying its experiences in China to this high-yield market. After achieving success in Southeast Asia, OPPO steadily expanded to conquer the high-potential European market, establishing a high-profile brand presence, and applying the experience gained in the Asia-Pacific market to the high-potential market. Based on this foundation, OPPO further expanded into the Latin American high-potential market, leveraging its global experience to empower this high-potential market. OPPO adopts a gradual approach, starting from easy to difficult, from point to surface, minimizing trial-and-error costs.

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