Hisense gains in the UK are driven by value

Chinese consumer electronics brand Hisense is making a splash in the United Kingdom with a diverse range of products.

"The UK market has a consumer population who are very aware of high-technology, new technology and prefer shopping online. They have a good and open attitude toward new brands, which as a new brand is great for us," says Louis Hou, managing director of Hisense UK Ltd.

In the UK, the company's revenue has grown from 8.5 million pounds ($12.4 million; 11.4 million euros) in 2013 to about 30 million pounds in 2015.

The company's strong UK growth was recognized in the 2015 Tou Ying Tracker, which ranked it fifth for turnover growth. The tracker has been developed by Grant Thornton and China Daily, and ranks the top 25-fastest growing Chinese companies in the UK.

"We are growing fast because we have great products and an understanding of the needs of customers in the UK market," says Hou.

Hisense grew out of Qingdao No 2 Radio Factory, founded by the local government in 1969. It established a globalization strategy in 2006, and it has built 16 overseas companies in North America, Europe, Australia, Africa, the Middle East and Southeast Asia.

In 2014, its overseas sales revenue reached $2.6 billion. Hisense household electronic products have been sold in more than 130 countries and regions, and Hisense-branded products have been sold in over 80 countries around the world.

"Our strategy is that we first bring into the UK market premium, high-end refrigerators, and we bring in more fancy products that suit the lifestyle of the UK consumers," Hou says.

After the company's refrigerators, the product that generates the second-largest revenue for Hisense in the UK is televisions, and this year Hisense added the latest 4K TV to its product range, ultra-high definition TVs.

"We are globally the third-largest producers of 4K TV, just after Samsung and LG. We believe our quality for the midmarket segment is the same as theirs, but we provide better value for money," says Hou.

Hisense 4K TVs, with a range in the UK retailing between 399 and 2,199 pounds, have received good market reviews. The most expensive model is the Hisense 65-inch 4K TV.

The Hisense 4K TV uses the technology of Ultra LED, which uses direct LED lighting where the lights are placed directly behind the screen.

John Archer, a writer for the online electronics review Trusted Reviews, says the Hisense TV screen delivers "genuine picture quality", as its pictures are sharp and detailed. "Hisense clearly has the potential to succeed where many manufacturers have failed in trying to secure a significant foothold in the UK market."

Hou says Hisense's international expansion is a good example of a three-stage model of expansion that many Chinese white goods products share. The first stage of expansion is producing as an original equipment manufacturer for Western brands, the second is selling its own branded products overseas through partnerships with local distribution partners, and the third is to manage branding and sales overseas itself, he says.

Hisense reached the third stage in 2009 when it restructured its European business, focusing on setting up subsidiaries to market Hisense-branded products.

This restructuring has led to the setting up of subsidiaries in Italy, Germany and Spain, followed by the UK in 2012 and now France.

(China Daily Africa Weekly 01/15/2016 page28)