How Transsion Holdings Became A $4 Billion Company by Leveraging On Design

How Transsion Holdings Became A $4 Billion Company by Leveraging On Design

For the uninitiated, Transsion holdings is the parent company of Tecno, Infinix and Itel. Recently, they had their IPO (initial public offering) on the Shanghai STAR exchange, a Chinese based exchange reserved for companies in the tech space and they raised 393 million USD, valuing the company at 3.95 Billion USD. Transsions IPO prospectus reveals some surprising facts, one of which is that 2018 revenue was 3.29 Billion USD, and they hold a whopping 64% of the feature phone market in Africa, with Nokia following them as a distant runner-up with 10%. In terms of unit sales, the three combined Transsion brands (Tecno, Infinix and Itel) control a combined smartphone market share of 36.2% with Samsung coming in at second at 23.9% and Huawei at 11.4%. 

The big question, however, is how did a Chinese company that was relatively unknown about 12 years ago end up having such a hold on the African Smartphone and feature phone scene? The Secret is in Design.

Design

In an article, I wrote about what design meant to me, and how design is much more than the product of design (well designed logo or banner, software user interface or a Hardware Product) but more about the process of design, or what has now been popularized by the term “Design Thinking”.

Design thinking is a five step iterative approach to problem solving used by designers and popularized by the team at global design Consultancy IDEO. Design thinking in essence has five steps; Empathize, Define, Ideate, Prototype and Testing. The Success of Transsion Holdings was made possible by the efficient execution of one of the five design thinking steps; Empathy.

Empathy

 Design is human and people centered, therefore the foundation of Design is Empathy. Empathy isn’t assuming you know why and where the shoe hurts, Empathy is about wearing the Shoe, and finding out for yourself where it hurts. Your chances of building products that connect with people are heightened when you develop true Empathy for your users and consumers, because not everyone that is frowning their face is angry. Some are hungry. Empathy will help you know the difference.

Design doesn’t try to influence human behavior, it adapts to it.

At the root of Transsion’s success is Empathy. Transsion’s understanding of the Nigerian (and by extension African)market and consumer has empowered it to position its product in the right place to solve the Jobs to be done (I’ll get to this later) of the Nigerian and African consumer. Here are some steps they took:

Dual Sim

 Transsion originally started with one brand; Tecno. And at the initial stages what they made were primarily feature phones, their phones weren’t necessarily high quality, and as for those who remember those days, those phones were nicknamed ‘Chinko’ phones. Be that as it may, Transsion noticed a gap in the market; the average Nigerian consumer liked having two phones, so, they took advantage of that information and began to design dual sim phones, today the rest is history, almost every new feature phone and/or smartphone launched into the Nigerian market comes with Dual sim capability. Transsion pioneered it in Africa.

Pricing

The average Nigerian is price conscious, very price conscious, if you sell a product in Nigeria for an exorbitant price that doesn’t already have a solid brand, and your market is the Average masses, you may need to re-strategize if you don’t want to go under. The average Nigerian is willing to choose one product over another based on a N1,000 ($2.78) difference in price. Transsion understanding this consciously made an effort to keep their phone prices down. Five years ago, at the end of the road for BlackBerry, people began migrating to either Android or IOS devices, but there was a problem, it was pricing. The two major Smartphones then were Samsung and Apple, which really didn’t solve the pricing problem (they exacerbated it). This was where Transsion saw an opportunity and grasped it. The first batch of Tecno hardware was so cheap, I remember a specific model was so cheap it costs one third of a hundred dollar!!!!.

Focus on what matters, ignore what doesn’t

There are very few technology companies as focused as Transsion. To achieve the right pricing, Transsion has to be focused on making sure that their phones don’t carry specs that are not necessary, and since they understand their market, it hasn’t been difficult to do. Being focused means not putting specs that are good on paper, but add little or no noticeable value to the user. To cut down on processor cost, they use Mediatek chips instead of Snapdragon, which are more cost effective for managing mid to low range Smartphones. They know you don’t need a high resolution OLED display, you also don’t need a 90Hz screen refresh, so it’s not included to avoid bumping up the retail price, wireless charging is nice, but for now it’s not a deal breaker, Phones are made of plastic as against Glass to save cost, in the end efficiency and good decision-making is really the backbone of their strategy. Things like the face unlock, all screen displays, fast charging and even a fingerprint scanner all have considerable value to the end user and are added to the product. Whatever is primarily a buzzword feature stays far away.

It’s a Numbers Game

Business executives love numbers, so do Nigerians. Although Transsion is a focused brand, they know when to play with numbers to attract your attention. Quadruple camera setup (4 Cameras in a phone), 32megapixel front facing camera, 4000 mah battery, 4gb of RAM, 64gb of internal storage, these are largely designed to draw the end users attention. In reality, the number of camera’s doesn’t determine how good a photo is, the Google Pixel 3, arguably one of the best photography Smartphones in the market has only one camera, most of the heavy lifting is done by computational software. Transsion understands well enough where to put numbers to draw the users attention and makes the most of this.

Some other strategies employed by Transsion include having a portfolio of three brands, meaning customers have a wide array of products to choose from instead of being stuck to one product from one brand.

How Does this Help me?

Empathy is the first step in Design thinking, if you will succeed in business, you must apply the principles of Empathy. Without a deep and thorough understanding of your consumers, and the market you intend to operate in, you run the risk of providing products and services that people don’t need or find valuable

 People do not buy products because they want to, they buy products because they want to “be”. There’s something we call the Jobs To Be Done Theory, your product isn’t just a ticket to perform an action by a user, it’s a way to bridge a gap between where a user is now and where he intends to be. Your product bridges that gap. Transsion bridges the gap of affordable premium, and democratizes the Smartphone experience. If your product will be successful it must locate a specified gap and bridge it for the intended user.

Conclusion

Empathy is key to success in business, if you can’t see from the eyes of your users, then you really can’t see at all. 

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