The Craze For Luo Yonghao's Smartisan Has Ebbed Away

(Chinese Version)

Recently, Mr. Luo Yonghao and his Smartisan Technology again aroused public attention. On June, 28th, it was reported that Smartisan’s CEO Mr. Luo sold off 2.05 million shares to Alibaba, one of the leading Chinese e-commerce service provider. The other days, Mr. Luo also revealed on his Weibo account that he would focus more attention on VR. All these moves left Smartisan’s fans wondering: will Smartisan ever be able to release T3 model?

However, even if Smartisan T3 would be released, can it help Smartisan survive? Up till now, Smartisan has released three smartphone models, T1, T2 and Jianguo. After some research, IT Times found that these smartphone models couldn’t be found on the quotation sheet of any retailers at large-scale telecommunication markets in Shanghai, and that the sales volume of Smartisan smartphones by its official vendors also dropped from sixty to one or two per day. In addition, we found that no Smartisan T2 smartphone was sold in a Suning Store for the past month.

Shocked by Smartisan’s market performance, we are wondering: how far can Smartisan, known for its passion for craftsmanship, go in the future?

Smartisan OS

Smartphone retailers: Smartisan was no longer in the quotation sheet

Da’ao Communication Mall and Everbright Mall, located around Shanghai Railway Station, are two of the major smartphone retailing markets in East China. When we entered Da’ao Communication Mall, we could see numerous smartphone stores surrounded by digital screens, which display brands such as Apple, Samsung, Huawei, Xiaomi, etc. In the display counters, OPPO, Vivo and Lenovo’s smartphones could also be found everywhere. However, we asked over 30 store owners if they sold Smartisan smartphones, none of them did, and several store owners even didn’t hear of Smartisan before.

“We used to sell Smartisan T1, but it didn’t sell well,” a store owner told IT Daily when he went through all the quotation sheet, “since nobody buys Smartisan, we won’t purchase it either.” He even logged onto Jiajian, a mobile purchase platform, but didn’t find Smartisan. However, other small-scale smartphone brands such as Meizu, Qingcheng, Coolpad, PPTV, Nubia are included in the platform. “Even the retailer stops selling Smartisan,” he told IT Daily.

Things were basically the same at Everbright Mall. After we interviewed several store owners, most of them told us that they didn’t sell Smartisan anymore. A store owner said that he only sold one Smartisan last year, but couldn’t purchase any Smartisan smartphone this year. Another store owner complained that Smartisan was too tiny a brand, so it was difficult to do parts business.

“Once a customer wanted to change the screen of his Smartisan smartphone, but I didn’t have a Smartisan screen, so I have to order one from the manufacturer, which took me over an hour. In comparison, I can change the screen of Huawei and Xiaomi on the spot,” he said.

During the press release conference of Jianguo in August, 2015, Mr. Luo Yonghao revelaed that the sales volume of Smartisan 1 was 255,626. However, the sales volume of Jianguo and Smartisan T2 was never revealed to the public.

Smartisan 2

Authorized distributors: Smartisan’s sales volume has dropped significantly

According to Smartisan's Official Customer Service, Smartisan has two authorized major distributors in Shanghai: Shundian Shanghai Jialicheng Branch and Jing’an Branch. Shundian, or Shundian Chain Co., Ltd, is a Shenzhen-based retailer specialized in smartphone, computer and digital camera. On the afternoon of July, 6th, we paid a visit to the Jing’an Branch.

Only Smartisan T2 were sold at this branch. According to the salesperson at the branch, Smartisan used to be quite popular when it was just released. At that time, the branch could sell over 60 Smartisan T2 a day, and the average monthly operation revenue could reach RMB 1.2 million (over $179,000), among which Smartisan T2 contributed to 1/3.

Whether we admit it or not, the craze for Smartisan has ebbed away. Zhuanqiao No.1 Store and Wu Jing No.3 Store at Soujicheng used to be the distributor of Smartisan, but didn’t renewed the contract after it expired. So they stopped selling Smartisan this year.

We continued to visit the Service Hall of three major Chinese mobile carriers, Suning Stores, Gome Mall to see if we could find Smartisan for sale, but ended up finding Smartisan T2 only in a Suning Store at Zhongshan Park. However, the salesperson at the store told us that they didn’t sell a Smartisan model for the past month. “The customer service of Smartisan is very inconvenient, and users will have to send it back to Beijing to get it fixed. In addition, its product line is also too limited compared with Huawei and Xiaomi.

Different from Smartisan, they have low, mid and high-end smartphones to meet the need of different groups of customers. Moreover, Smartisan wasn’t in an advantage even in terms of the price. Consumers could buy other smartphone models such as Lenovo Z2, Huawei R9, OPPO R9, Vivo X7, etc. at the same price as Smartisan T2, while their performance and memory are all higher than those of Smartisan,” the salesperson explained.

By the way, sales personnel at other stores all suggested that they didn’t have any cooperation with Smartisan. At last, we find in Smartisan’s official store on Tmall that the total sales volume of Smartisan T2 (16GB) was 8,202, while the sales volume of Jianguo (16GB) and Jianguo (32GB) was 59,032 and 12,057, respectively.

Smartisan's Jianguo series

Hong far can Smartisan go in the future?

Before our field research, we did a quick questionnaire and found that 3/4 of respondents heard about Smartisan before, and 1/4 of respondents heard about Luo Yonghao’s “passion for craftsmanship”.

On May, 20th, 2014, Mr. Luo Yonghao first came up with the concept “qinghuai” (which means “passion for craftsmanship”) at the press release conference of Smartisan T1. Obviously, Smartisan’s target consumers are “wenyi” youth (which means people who are a little bit “arty” and are interested in things known by the minority). However, Smartisan T1’s price is as high as RMB 3,000 (over $448), so its sales volume didn’t reach as high as expected.

“‘Passion for craftsmanship’ is of course one of the selling points for smartphones, but it shouldn’t be a determining factor. Competition in the current Chinese smartphone market is so fierce that most consumers will attach higher importance to performance and quality”, Wang Yanhui, secretary of shouji2345.com, commented.

He is speaking the truth. Smartisan aroused huge public attention and entered the market by upholding “passion for craftsmanship”, targeting “the arty people” and developing smartphones that are exquisite-made and aesthetic-attractive. However, it’s obvious that Smartisan’s already in danger due to the following reasons:

First of all, the price of Smartisan T1 is too high, so most people would only talk about it but won’t buy it. Although they might be attracted by Smartisan’s concept, it wasn’t persuasive enough so that people would be motivated to buy one themselves.

Secondly, the upgrade speed of Smartisan is too low. For example, it take Smartisan a year and a half to release T2, the next generation model of Smartisan T1. Long upgrade interval made few people patient enough to follow the recent development of Smartisan, which undermined its influence ultimately.

Thirdly, defective rate of Smartisan T1 was so high that consumers’ good impression of Smartisan was significantly compromised. At the same time, Smartisan’s founder Mr. Luo Yonghao could be too much outspoken, and often talked without thinking, which also left some consumers a very negative impression.

Fourthly, after Smartisan found that the price was too high, it chose to lower the price significantly to clear out the stock, which not only contradicted with its“passion for craftsmanship”, but also hurt the feelings of many its super fans, who bought Smartisan at a high price.

On June, 5th, Luo Yonghao shocked everyone by hinting on his Weibo account that he would enter VR industry. However, only time will tell if Mr. Luo can bring back Smartisan with the help of VR technologies.

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[The article is published and edited with authorization from the author @IT Times, please note source and hyperlink when reproduce.]

Translated by Levin Feng (Senior Translator at PAGE TO PAGE), working for TMTpost.