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The document discusses Haier, a Chinese appliance manufacturer. It provides an overview of Haier's history and growth since 1984, including expanding production lines, going public on the Hong Kong Stock Exchange in 2004, and beginning international expansion in 1995. Key aspects of Haier's success include quality control practices, adapting to changes such as globalization and new technologies, and a long-running cartoon advertisement campaign without celebrity endorsements. The document also notes Haier's competition in China and worldwide, and factors that may contribute to its continued success such as growing demand in China and established business strategies.
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Haier is a Chinese multinational home appliances company headquartered in Qingdao, China. It designs, manufactures, and sells products like air conditioners, refrigerators, washing machines, and televisions. Innovation is central to Haier's strategy, as they have introduced innovations like bottom mount refrigerators, double drive washing machine technology, and 4K televisions. Haier has over 7,000 employees dedicated to innovation programs worldwide and was ranked the 8th most innovative company in the world in 2012 by the Boston Consulting Group.
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The Future of the Industry
A. Given your industry and intra-industry analysis, what do you think the future holds for the industry? What do you predict will be future trends in industry performance?
B. Are significant opportunities in the market untapped?
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Brief Historical Overview of the Firm
A. What is the strategic scope of the company? What products and markets does the firm compete in?
B. What are the company's stated missions and objectives? How have these missions changed over time?
C. What has the recent history of the firm been?
D. What recent events have significantly affected the firm?
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Haier: Taking a Chinese Company Global in 2011
Starting in 1984 with a defunct refrigerator factory in Qingdao, a port city in China’s Shandong province, founder and CEO Zhang Ruimin built Haier Group (Haier)a into China’s largest home appliance (white goods) maker before launching operations overseas in the 1990s. Haier developed a formal global expansion strategy beginning in 1997, when Zhang announced his “three thirds” goal of having Haier revenue come equally from goods produced and sold in China, goods produced in China and sold overseas, and goods produced and sold overseas. This announcement came amid three decades of booming economic growth in China that began with agricultural reforms in 1978. The reform program then extended to the creation of special economic zones for manufacturing and trade, the rise of small collective businesses, and the privatization of state-owned industry in the 1980s. The reforms of the 1990s included tax and currency restructuring and policies to facilitate foreign enterprise, free trade, and the growth of equity markets.1
From 1980 to 2010, China’s real gross domestic product (GDP) grew at an average annual rate of nearly 10%, lifting hundreds of millions of people out of extreme poverty and creating an urban middle class.2 By 2010, the Chinese economy was the world’s second largest, measured by GDP at purchasing power parity (PPP), and analysts expected it to exceed the size of the U.S. economy within decades.3 While per capita disposable income was substantial in 2010, however, some geographic regions in China were still relatively poor on a per capita basis. (See Exhibits 1a and 1b for economic, demographic, and currency data on China.) Most urban households already owned white goods, but in rural China, penetration rates for appliances such as refrigerators still stood at 58.2 units per 100 households, offering room for market growth. China had been the world’s leading white-goods manufacturer since 2007 and, in 2010, was home to 49% ...
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Haier is the number 1 major appliance brand globally with $23 billion in annual sales. It has a large global presence with factories and sales in over 165 countries. Haier invests heavily in R&D and innovation, receiving many awards for its innovative products. In Europe, Haier has a factory and headquarters in various countries and sells its TVs, refrigerators, washing machines, and other appliances. For 2013, Haier will focus on LED and smart TV technologies, expanding its product lines, and increasing brand awareness through sponsorship of sports and cultural events as well as digital and social media marketing.
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Based on Haier Case, answer each question below. If possible, each question gives one paragraph. (one and half pages enough)
Industry analysis
The Future of the Industry
A. Given your industry and intra-industry analysis, what do you think the future holds for the industry? What do you predict will be future trends in industry performance?
B. Are significant opportunities in the market untapped?
C. What might the current competitors in the industry do to improve their competitive position?
D. Are there significant threats to the industry looming over the horizon?
Firm-level analysis
Brief Historical Overview of the Firm
A. What is the strategic scope of the company? What products and markets does the firm compete in?
B. What are the company's stated missions and objectives? How have these missions changed over time?
C. What has the recent history of the firm been?
D. What recent events have significantly affected the firm?
E. How well has the firm recently performed?
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Haier is the number 1 major appliance brand globally with $23 billion in annual sales. It has a large global presence with factories and sales in over 165 countries. Haier invests heavily in R&D and innovation, receiving many awards for its innovative products. In Europe, Haier has a factory and headquarters in various countries and sells its TVs, refrigerators, washing machines, and other appliances. For 2013, Haier will focus on LED and smart TV technologies, expanding its product lines, and increasing brand awareness through sponsorship of sports and cultural events as well as digital and social media marketing.
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Company presentation
- 1. Presented by: Jiayi Yan
- 2. Sample Product • Consumer electronics and home appliances Picture from http://image.baidu.com
- 3. Financial Info 180 160 140 120 100 80 60 40 20 0 2007 2008 2009 2010 2011 Annual Revenue of Haier (Billion CNY) 2012
- 4. History 1984: Haier had been founded as Qingdao Refrigerator Co. 1986: The company became profitable for the first time. 1988: The company started adding production lines, air-conditioner, microwave, etc. 1995: The company started international expansion. 2004: The company gained a backdoor listing on the Hong Kong Stock Exchange.
- 5. Secret Sauce • Quality Control o Smashing Refrigerator Event • Keeping up with changes o Globalization since 1990s o Technical innovation
- 6. What’s HOT • Cloud Living - internet-connected appliances o Interactive fridge with a see-through door o 3D TV o Etc. Picture from https://www.google.com/search?q=future+for+haier
- 7. One Interesting Fact • A cartoon called “Haier Brothers” o “Longest advertisement” o No celebrity stars hired o No products placed in the cartoon
- 8. Competition • In China • Worldwide
- 9. Will Haier Succeed? • Above-mentioned secret sauce • Growing China market ¥1000m revenue ! Info from http://bambooinnovator.com/2013/09/20/wash-rinse-rebrand-electrolux-spiffs-up-appliances-in-china-company-has-been-stuck-in-slow-sales-cycle/