Vivo.pdf

G. H. PATEL POST GRADUATE INSTITUTE OF BUSINESS MANAGEMET

BRIEF ANALYSIS OF

“VIVO MOBILES”

Subject: Business Policy and Strategic Management

Submitted to: Dr. K. S. Prasad

Submitted By: Palak Makadia (17M21)

G. H. PATEL POST GRADUATE INSTITUTE OF BUSINESS MANAGEMET

1. Introduction about product/ organization with relevance to value chain analysis.  Vivo Communication Technology Co. Ltd., known as Vivo, is a Chinese technology company owned by BBK Electronics that designs and manufactures smart-phones, smart-phone accessories, software, and online services, which are then sold in India. The company develops software for its phones, distributed through its Vivo App Store, with iManager included in their proprietary, Android-based operating system, Funtouch OS. Vivo was founded in 2009, in Dongguan, China, and was named for the Esperanto word for life.  Vivo value chain analysis is an analytical framework that assists in identifying business activities that can create value and competitive advantage to the mobile internet company. Figure below illustrates the essence of Vivo value chain analysis.

 Vivo Primary Activities  Vivo inbound logistics involves the delivery and storage activities of raw materials by the company. Vivo has a team of experts who designs and engineers each of the models. The parts of the smart-phone are brought in from various suppliers. Also Vivo procures various electronic components from nearby countries.  Vivo has already established its presence in India, Thailand, Philippines, Myanmar, Malaysia, Indonesia, Pakistan, Cambodia and Bangladesh. The company has announced that it will establish its presence in around six new regions in the coming months. It will soon launch in Taiwan, Singapore and Hong Kong. It also has plans to enter the Russian market. For establishing its presence in the African market,

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the company will start with Morocco and Kenya. Later, the company is expected to spread out to European countries as well. Initially, Vivo outbound logistics practices were limited to the shipment of products directly to end-users via couriers. At that stage the company was using only online sales channels in order to save costs and maintain its cost leadership position in the global marketplace. However, due to increasing demand for Vivo products and intensifying competition in the market, the electronics and software company had to open company-operated stores as well. Vivo has set-up its manufacturing plant in India now. Vivo marketing and sales practices are based on its cost leadership business strategy. The mobile company sells its products using both online sales channels and traditional offline sales channels as well. The company uses hunger marketing strategy and flash sales frequently. They are good. You can find authorized service centre near you from BinBill App. It provides a platform in which consumer bills are categorized according to their genre after a consumer add his/her bill through BinBill app available at play store or website. Consumer can add any kind of bill either it be online bill, hard copy, in pdf etc. The best part is that we just need to send the image of the bill and everything else such as capturing important details from bill i.e amount, seller info, product details, etc. is done by them. Therefore BinBill is your my invoice eHome, bill storage service helping you out with whatever will it be regarding after sales.

G. H. PATEL POST GRADUATE INSTITUTE OF BUSINESS MANAGEMET

2. Draw a PESTEL model along-with SWOT analysis.  SWOT Analysis VIVO SWOT ANALYSIS 1. Vivo has established itself well in South Asian markets 2. Vivo offers various models in different price ranges but still keeping its affordable image intact 3. Vivo has entered Indian market with good success with sponsorship and visibility

STRENGTHS

4. It comes from the stable of BBK electronics, its parent company which also owns brands like Oppo 5. Vivo has been associating with big sporting events like the Indian premier league 6. Vivo is seen as an innovating brand 7. It was the first to launch a phone with HiFi Chip 8. Vivo has stores in more than 350 cities 9. It is present in 7 overseas market 10. Vivo focuses a lot on R&D 11. Vivo has product facilities in China, Indonesia and India

WEAKNESSES

OPPORTUNITIES

THREATS

1. It still does not have high brand awareness; its main differentiator is cost. 2. Vivo is seen similar to other brands like Oppo, OnePlus, etc. 1. Vivo can come up with high end smartphones which compete directly with Apple and Samsung. 2. Vivo should work on tweaking its image and targeting to more customers who does not focus only on cost. 3. It has huge untapped market in US and Europe. 1. Price sensitive competition in mobile segment. 2. Local government regulations.

G. H. PATEL POST GRADUATE INSTITUTE OF BUSINESS MANAGEMET

 PESTEL ANALYSIS This is an important step for eventually devising a strategy that can effectively manoeuvre the competition to maximize a firm's chances of sustainability and profitability. An understanding of the overall competitive landscape will prevent investors and entrepreneurs from partaking in any risky ventures if the risk arises out of, say, an unstable political regime or a sudden economic recession.  Political Factors The political factors that may impact the profitability or chances of survival of the company are quite diverse. The political risks vary from sudden changes in existing political regimes to civil unrest to major decisions taken by the government. In cases of possible multinationals, one may also include political factors that take place/ affect not only the host country but also all countries that contain business operations, or that may engage in trade with Vivo. To properly appraise the extent of the overall systematic political risk that Vivo may be exposed to, the following factors should be considered before taking part in any investments: - The level of political stability that the country has in recent years. - The integrity of the politicians and their likelihood to take part in acts of corruption, as the resulting repercussions may lead to possible impeachments or resignations of high level government employees. - The laws that the country enforces, especially with regards to business, such as contract law, as they dictate what Vivo is and is not allowed to do. Some countries, for example, prohibit alcohol or have certain conditions that must be fulfilled, while some government systems have inefficient amounts of red tape that discourage business. - Whether or not a company’s intellectual property (IP) is protected. For example, a country that has no policies for IP protection would mean that entrepreneurs may find it too risky to invest in Vivo - The trade barriers that the host country has would protect Vivo; however, trade barriers that countries with potential trade partners would harm companies by preventing potential exports. - A high level of taxation would demotivate companies like Vivo from maximizing their profits. - The risk of military invasion by hostile countries may cause divestment from ventures. - A low minimum wage would mean higher profits and, thus, higher chances of survival for Vivo.  Economic Factors Economic factors are all those that pertain to the economy of the country that Vivo operates in, such as changes in the inflation rate, the

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foreign exchange rate, the interest rate, the gross domestic product, and the current stage of the economic cycle. These factors, and their resulting impact on aggregate demand, aggregate investment and the business climate, in general, have the potential to make a company highly profitable, or extremely likely to incur a loss. The economic factors in the PESTEL analysis are macroeconomic. The economic factors that Vivo may be sensitive to, and in turn should consider before investing may include the following: - The economic system that is currently operational in the sector in question- whether it is a monopoly, an oligopoly, or something similar to a perfect competition economic system. - The rate of GDP growth in the country will affect how fast Vivo is expected to grow in the near future. - The interest rates in the country would affect how much individuals are willing to borrow and invest. Higher rates would result in greater investments that would mean more growth for Vivo. - However efficiently the financial markets operate also impact how well Vivo can raise capital at a fair price, keeping in mind the demand and supply. - The exchange rate of the country Vivo operates in would impact the profitability of Vivo, particularly if Vivo engages in international trade. The stability of the currency is also importantan unstable currency discourages international investors. - A high level of unemployment in the country would mean there is a greater supply of jobs than demand, meaning people would be willing to work for a lower wage, which would lower the costs of Vivo.  Social Factors The social factors that impact Vivo are a direct reflection of the society that Vivo operates in, and encompasses culture, belief, attitudes and values that the majority of the population may hold as a community. The impact of social factors is not only important for the operational aspect of Vivo, but also on the marketing aspect of the organization. A thorough understanding of the customers, their lifestyle, level of education and beliefs in a society, or segment of society, would help design both the products and marketing messages that would lead to a venture becoming a success. The social factors that affect Vivo and should be included in the social aspect of the PESTEL analysis include the following: - The demographics of the population, meaning their respective ages and genders, vastly impact whether or not a certain product may be marketed to them. Smart-phones is mostly catered to teen, so targeting a majority old and aging population would be less

G. H. PATEL POST GRADUATE INSTITUTE OF BUSINESS MANAGEMET

population than targeting a population that is mostly teen and working. - The class distribution among the population is of paramount importance. Vivo would be unable to promote a premium product to the general public if the majority of the population was a lower class; rather, they would have to rely on very niche marketing. - To some extent, the differences in educational background between the marketers and the target market may make it difficult to relate to and draw in the target market effectively. Vivo should be very careful not to lose the connection to the target market's interests and priorities. - Vivo needs to be fully aware of what level of health standards, reactions to harassment claims and importance of environmental protection prevail in the industry as a whole, and thus are expected from any company as they are seen as the norm.  Technological Factors Technology can rapidly dismantle the price structure and competitive landscape of an industry in a very short amount of time. It thus becomes extremely important to constantly and consistently innovate, not only for the sake of maximizing possible profits and becoming a market leader, but also to prevent obsolescence in the near future. There are multiple instances of innovative products completely redesigning the norm for an entire industry: Uber and Lyft dominate the taxi cab industry; smart-phones have left other phones an unviable option for most et cetera. The technological factors that may influence Vivo may include the following: - If Vivo encounters a new technology that is gaining popularity in the industry in question, it is important to monitor the level of popularity and how quickly it is growing and disrupting its competitors’ revenues. This would translate to the level of urgency required to adequately respond to the innovation, either by matching the technology or finding an innovative alternative. - How much an improvement of technology would improve/ transform what the product initially offers. If this improvement is drastic, then other firms in the industry suffer more heavily. - The impact of the technology on the costs that most companies in the industry are subject to have the potential to increase or reduce the resulting profits greatly. If these profits are great in number, they may be reinvested into the research and development department, where future technological innovations would further raise the level of profits, and so on, ensuring sustainable profits over a long period of time.

G. H. PATEL POST GRADUATE INSTITUTE OF BUSINESS MANAGEMET

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Environmental Factors Different industries hold different standards of environmental protection in their head as the norm. This norm then dictates what every company should aim for, in the least, to prevent becoming the target of pressure groups and boycotts due to a lack of environmental conscientiousness. The environmental factors that may significantly impact Vivo include: - The current weather conditions may significantly impact the ability of Vivo to manage the transportation of both the resources and the finished product. This, in turn, would affect the delivery dates of the final product in the case of, say, an unexpected monsoon. - Those companies that produce extremely large amounts of waste may be required by law to manage their environmental habits. This may include pollution fines and quotas, which may place a financial strain on Vivo - If Vivo should (knowingly or unknowingly) contribute to the further endangerment of an already endangered species may face not only the consequences from the law but also face a backlash from the general public who may then boycott Vivo in retaliation. - While relying, in any percentage, on renewable energy may be expensive, it often receives support not only from the government but also from its customer base, who may be willing to pay a premium price for the products that Vivo may produce.  Legal Factors The government institutions and frameworks in a country while technically also political and thus subject to whichever political party holds the majority in a government body, are also legal and thus should be considered in a PESTEL analysis. Often Vivo policies on their own are not enough to efficiently protect Vivo and its workers, making Vivo appear an undesirable place of employment that may repel skilled, talented workers. The legal factors that deserve consideration include the following: - Intellectual property laws and other data protection laws are, as mentioned earlier, in place to protect the ideas and patents of companies who are only profiting because of that information. If there is likelihood that the data is stolen, then Vivo will lose its competitive edge and have a high chance of failure. - Discrimination laws are placed by the government to protect the employees and ensure that everyone in Vivo is treated fairly and given the same opportunities, regardless of gender, age, disability, ethnicity, religion or sexual orientation. - Health and safety laws were created after witnessing the horrible conditions that employees were forced to work in during and directly after the industrial revolution. Implementing the proper

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regulations may be expensive, but Vivo has to engage in it, not only due to the law but also out of Vivo's personal feeling of ethical and social responsibility to other human beings. Laws are also placed to ensure a certain level of quality or reasonable price for certain products to keep the customer safe and prevent them for being provided. The industries this applies to find often their costs elevated.

3. Explain the industry’s dominant economic traits.  The following are the details of mobile phone industry’s dominant economic characteristics.  Market Size: The smart phone industry is one of the fastest growths besides the Internet. Smart phones have gone through a huge change and its market has expanded globally. Since 1994, the smart phone industry has increased from 24 million to about 182 million in wireless phone and related devices operating in the United States with some 162million mobile-phone users in the United States alone. The smart phone market is increasing very fast with today’s everemerging technology and innovation in improving smart phones. Today, society is living with advance technology and everyone wants to keep pace with the new technologies. Smart phone industry is growing larger because it has become a necessity. Parents are getting mobile phones for their teens because they want to communicate in case of an emergency and the wireless carriers have made it easy to add users to their existing plans. And carriers are becoming successful in getting parents to expand their plans to include their teens. This increases buyers and increases market size worldwide.  Scope of Competitive Rivalry: The smart phone industry has become increasingly larger within the last three years as a result of more affordable smart phones as well as lower service costs. Companies are competing in an advance technology and communication sector in which success attracts customers to buy their products and services. The market is very competitive because they offer the same products and services, but has different physical attributes to the phones and different costs, which buyers have choices to choose from. Companies want to provide the best products and services to attract buyers by lowering cost and improving products, which makes the smart phone industry very competitive. Here are the main factors of competitive rivalry: - Smart phone cost: Customers wants better services and products at a lower cost. - Bundle functions into just one smart phone: For example E-mail, text messaging, internet

G. H. PATEL POST GRADUATE INSTITUTE OF BUSINESS MANAGEMET

- New technology improvement: For example camera phones - Better landline services  Stage in Life Cycle: The smart phone industry is in the Mature Life Cycle Stage, where nearly all-potential customers are already users of the industry’s product. The smart phone industry’s growth and profitability depends entirely on its ability to attract new customers. By increasing and improving the smart phones and services, it will attract more potential buyers, because technology alone will not attract buyers, instead companies want value-added services for mobile-phone securities. Smart Phone companies attract buyers in two ways during the Mature Life Cycle State: - Service: Making smart phone more affordable will attract buyers to buy more smart phones and increase competition between companies to lower service fee. - Innovative Phone Style: The new designs and improvement in the physical appearance of the smart phones, and more add-on features attracts customers to buy it at a higher rate.  Numbers of Companies in the Industry: There are over 50 companies with only five top companies in the smart phone industry that controls 80 percent of the market. Even though there are emerging new companies into the market, they are relatively small. The five top companies are rank as follow as the largest to the smallest smart phone company: 1. Samsung 2. Apple 3. Xiaomi 4. Lenovo 5. LG Vivo has a market share around 7% in 2018 making it one of the leading brands in India.  Customers: Smart phones are attractive targets that are small, expensive, and useful. Today there are approximately 162 million mobile-phone users in United States alone. With the list of features and data applications available on mobile phones, which is continuing to grow and emerge; smart phones are not only a luxury but also necessity. Smart phone users use smart phones for more than just talking; the mobile services consumer wireless usage study found that 56 percent of customers used their smart phones as cameras, clocks, calendars, music players, and other non-talk functions. Also, most smart phone owners are between the ages of 18 to 34.

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Technology/Innovation: Technology and innovation are advanced every year making the industry even more competitive. Smart phone companies that design and make evolutionary upgrades are emerging into the market to be more competitive. Here are some new technology and innovations on smart phones: - Unlicensed Mobile Access (UMA) will help those who have highspeed Wi-Fi routers overcome poor reception coverage in their houses or apartments. This is also a way for mobile carriers to expand without spending a lot of money on new infrastructure. It enables lots of users who use handsets to wirelessly download content at broadband speeds while travelling. - Smart phone tour guides: Provides buyers with guides of places they want to see. For example. Weaver’s and Stiller’s voices are used as narrators in Talking Street that shows a series of smartphone tours from Manhattan to the World Trade Centre. The technology is meant to be more vivid and more exciting than books or live tours. Some in the industry believe that this new technology saves time and money. Also, not all mobile-phone tour services charge a fee for using the service. - VOIP on mobile phones will help cut smart-phone bills most of all for international users based on the assumption that if consumers are already paying for a data plan, will route international calls over their phone’s data connection using VOIP and can save considerable money.  Product Characteristics: In the smart phone industry, the products and services are highly standardized. In the past, the products differentiated in smart phones and services. Today, with more technology enhancement, the products in different companies are essentially similar. Since this is a smart phone industry, there is a maximum amount of products and services that consumers can choose from. Vivo phones come with some special features like: - Smart Touch - Air Operations - Smart Motion - Flashlight on shake - Rear Fingerprint Sensor - Face Unlock  Scale Economies: There are two types of economies of scale pertaining to the smart phone industry. They are the internal and external economies. 1. Internal: Internal economies of scale are economies made within a company as a result of mass production. So as a company

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produces more and more products and services to consumers, the average cost begins to fall so the companies should focus on the following six factors: - A technical economy: when the companies use its entire means to generate revenues and increase profitability. This includes spending a large amount of money on capital to start the company. - Managerial economies: when the company splits up managerial duties to meet specific company goals and values. This in turns helps to complete specific tasks and improve the company to better service consumers. - Financial economies: smart phone companies borrow lots of money to purchase capital in order to create products for consumers. - Marketing economies: where smart phone companies spends a lot of money to advertise their products and services on television and in newspapers everyday to reach consumers across nations. Companies resorts to marketing in hope of attracting more consumers to try their products and to generate higher profits and revenue. - Commercial economies: smart phone companies order their products and supplies in bulk at a lower rate rather than buying them separately. - Research and development economies: the smart phone companies are continuously developing new and advance technology smart phone to be in pace with the competitive market. 2. External: The external economies are made outside of the company as a result of its location. Most smart phone companies have a corporate headquarter that concentrates on the following to keep track of the company’s progress. - Smart phone companies have licensed franchises that operate to sell products and services to consumers. They have a network that connects them to manufacturers, service carriers, and main corporate officer that is the backbone of the stores and products it sells. - The smart phone companies works closely with service carriers to provide phone service such as clear phone calls, not lost calls, and good receptions. - The companies work and communicate directly with manufacturers reputable for the new phones enhancement, upgrades, and features.  Learning & Experience Effects: The major complaint found in the smart phone industry was cost and services. So to improve their service, the company has increased the training for customer service employees, and introduced a new plan to address common complaints; also tied executive compensation to

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customer satisfaction. There are more options that buyers can choose from. Capital Requirements: The smart phone companies require large capital to enter and remain in the market successfully. Companies require capital to create products that attracts consumers and for total assets and revenues to enlist other products and services that are featured with smart phones. Smart phone companies work with manufacturers to create new technological and innovative smart phones in the market today to attract consumers. A valuable capital in the smart phone industry is the consumers because revenue and profits depends on them who buy the companies’ smart phones. New products are introduced continually, technology evolves on a daily basis, and customers are eager to become part of the future of a wireless society. This makes the market very competitive and large companies that have big economies of scale provide a highly automated service to a large number of customers, and have the financial resources required in building and maintaining a large network of communications devices. Smaller companies can also compete, but only in small markets or by provide specialty services. Industry Profitability: The cell phone industry will remain a competitive market and will increase continuously with a total of 1,200 wireless companies with total annual revenue of $100 billion. The profitability of individual companies is driven mainly by their ability to develop new products, providing better service, making their products affordable for consumers. Profitability of companies is achieved also by taking advantage of marketing their products, have access to capital, and by inquiring the expertise to improve the cell phones.

4. What kind of competitive forces are the industry members facing?  Porter’s Five Forces is an analytical framework developed by Michael Porter. Porter’s Five Forces consists of five individual forces that shape an overall extent of competition in the industry.

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Intensity of Rivalry within the existing firms This refers to the level of completion between competitors and rivals through advertisements, product quality, price wars, differentiation and other strategies. Rivalry in the smart phone industry is moderate, because customers tend to have high brand loyalty at the high end of the market. The industry has huge customer base of over 968 Million worldwide. The Industry is growing at rate of 28- 30% worldwide and at 168.8% in India. Top players in smart phone market include Samsung, Apple, Huawei, Lenovo, Xiaomi and LG. Samsung is dominant player in the smart phone market with nearly 25% market share in the second quarter of 2014. This share has come down from 32.2% from a year before. Apple has lost 2% from previous year to settle down at 11% in the second quarter of 2014. On the other hand Xiomi emerged as a new player in the smart phone market which has seen increase in market share from 1.8% to 5.10% in just one year. Rivalry in smart phone industry is stiff with the target being standard phone features like the software’s used and security, cameras, screens, touch screen quality. Vivo faces maximum rivalry from Oppo, OnePlus and Xiaomi as they offer similar product with almost undifferentiable features and that too for the equivalent value for money. Intensity of Supplier Power This refers to the bargaining power of suppliers which is their ability to exert pressure and influence competitors to increase their prices leading to their profitability and other benefits at the expense to the supplier’s profitability and even on suppliers and their power in the smart phone industry observed that Apple has managed a complex chain of suppliers that are spread globally over several nations and on the other hand Vivo uses a very simple supply chain. This huge number of limits their bargaining power with Apple.

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General parts and components suppliers do not have substantial bargaining power due to the importance of Vivo’s order volume and its ability to negotiate prices with suppliers. Therefore smart phone manufacturers have a stronger power over suppliers for most parts but the software’s used with Google and Microsoft having an upper hand. This shows that not all suppliers for smart phone manufacturers have the same influence with software suppliers having more power over the manufacturers compared to parts manufacturers. Threat of Substitutes Threat of substitutes refers to the level to which products and services can be exchanged with other products and services in the competitive market. Smart phones can be substituted by tablets in the market which have similarities in terms of device interface, apps and functionality. However, smart phones may prove quite attractive to more customers because with similar capabilities, they come in unique shapes, sizes and functionalities. Threat of New Entrants According to Porter new entrants influence the level of profitability and industry attractiveness and identify six barriers to new entrants. The start-up costs for new smart phone manufacturers are extremely high hence low threat by new entrants as this makes entry difficult. However few entrants continue to join the industry particularly those targeting low and middle class customers. Vivo entered the Indian industry in 2014 and become the one of the largest smart phone company. Purchasing Power of Buyers Bargaining power of buyers refers to the ability of buyers to exert pressure or influence competitors in an industry leading to their profit reductions, better quality and better services at the expense of the competitors. Smartphone manufacturers Vivo need the customers who can easily be lured by the rivals products and prices. This ultimately grants smart phone customers’ moderate to high bargaining power over the smart phone manufactures. With low switching costs, their position bargaining power is further strengthened. The customer demand is elastic and highly price sensitive. Therefore to manage buyer power, smart phone manufacturers should develop affordable, diverse and easily accessible phones.

5. What factors are driving industry changes and what impacts will they have?  Below are listed various factors that drive the industry change:  Changes in who buys the product and how they use it:

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The target market of the smart phone is young generation. There are two parts of the young generation that are students and working class. Students want to have smart phone, there are about 80 percent students who own a smart phone at college in 2017, compared with 38 percent in 2009. The 97 percent of students use messages for their primary communication method and people who are in corporate use email to communicate to each other. There are about 90 percent of smart phone users that use their phone to surf the internet. About 97 percent of the users take and upload photos and 87 percent of the owners other applications. Vivo has taken this change in consideration and added special features like high speed internet facility (4G), good quality cameras, high internal and expandable memory and a long battery life. Increasing globalization of smart phone industry: The demand of the smart phones is growing rapidly worldwide, because of mobile internet becomes more popular. More and more people start to buy a smart phone, because of the trend market. Smart phone has replaced the otherwise traditional phone. Vivo positions its mobiles as the medium to connect to the world. With the changed basic needs of today, i.e. to remain in constant touch with everyone, anywhere, the 4G, video calling and the likes are the features incorporated in the Vivo mobiles. Changing societal concerns, attitudes, and lifestyles: Smartphone has changed the way people used to be. First, the communication between the people has changed. People use social media to communicate to each other. “Facebook user base has risen to 430 million year-over-year, roughly the same increase as QQ in China. Twitter, while sporting only 58 million users experienced a 1238% year-over-year growth rate. Facebook now dominates in chat, messaging, video sharing, games, VoIP and more. People want to check the social media instead of text message and give a phone call. Vivo smart phones can give people the latest news from the social media anywhere and anytime. Second, the lifestyle has changed. People used to go to the bank to make transaction and deposit the check. Now with the Vivo’s “vivoCloud”, one can easily keep all their data safe and secure without the worries of losing it in some accidental action. Industry life cycle: There are five stages of the industry life cycle. In the embryonic stage, the industry starts to begin and develop the product to the public. In the growth stage, the company produces more products and increases the market share. In the shakeout stage, some of competitors start to see the opportunities in this market. In the maturity stage, the product price is stable and more competition comes to market. In the decline stage, the sale of the product decreases until the product innovation or discontinue in the market. The Vivo smart phones have reached the

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growth stage like all other members of this industry. The demand for the smart phones has stagnated; rather the customers now want an updated version or new features. The sale of the smart phone was 174 million units in the 2009; there were 270 million units sold in 2010. Internal Analysis: Value Chain- The value chain is that an organization creates value by performing a series of activities and it represents how each competitive advantage created via an organization adds value to the service or product for each customer. In the Vivo Mobiles, R&D, Production, Marketing & Sales, Customers Service and Human Resource are adding the value to their company. Research and Development: Vivo is extremely concerned about research and development department. Leading smart phone manufacturer Vivo has been recognized as having the 5th-highest shipment volume among global smart phone manufacturers per IDC's 2017 Q1 report. This recognition comes as Vivo has been expanding its global research and development (R&D) capabilities, with a focus on 5G technologies and integrating them into its cutting-edge smart phones. To drive future breakthroughs that will take their smartphones' performance and user experience to the next level, Vivo has established seven R&D centers worldwide, including two in Silicon Valley and San Diego, as well as five in Shenzhen, Dongguan, Nanjing, Hangzhou and Beijing, China, where it will continue to develop in-house smart phone technologies including 5G, mobile camera, and Hi-Fi music technologies that appeal to its customers. At Vivo's Beijing R&D centre the company engages in the research of new 5G technologies. Engineers leverage their insights into more than 100 million of Vivo's global smartphone users' experience to develop 5G technology that offers an upgraded user experience. The company's Hangzhou R&D centre is responsible for photography technology research, while the institutes in Silicon Valley and San Diego are focused on core technologies that support Vivo's fundamental algorithm photography technology development. Production: Vivo has grown very fast. Vivo has unveiled the world’s first HalfScreen In-Display Fingerprint Scanning Technology on Vivo APEXTM , along with Screen SoundCasting Technology and an Elevating Front Camera. Vivo needs to make sure their suppliers to increase productivity in order to meet the demand of the market. Vivo needed more manufacturing plants and facilities to meet the increasing demand of Vivo Mobiles and so it established plants at Dongguan, Chongqing, India and Republic of Indonesia. Vivo pay attention on their quality from each of the product that they produce.

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Marketing and Sales: In October 2015, Vivo became the title sponsor of the Indian Premier League under a two-year deal starting in the 2016 season. In July 2017, the deal was extended until 2022. In June 2017, Vivo reached a sponsorship deal with FIFA to become the official smartphone brand of the 2018 and 2022 FIFA World Cups. The company also became a title sponsor of India's Pro Kabaddi. Vivo has a sponsorship deal with the U.S. National Basketball Association in China, with Golden State Warriors player Stephen Curry endorsing the brand in China and the Philippines. The company contracted product placement with Marvel Studios for Captain America: Civil War, in which Vivo phones are used by both Captain America and Iron Man. Customer Service: Vivo is one of the companies that has undoubtedly performed exceptionally well. Company’s aim to target the financially middle class Indians who prefer budget friendly phones that comes with features that are as good as you can find in premium class smart phones. The reason Vivo has managed to win millions of customers is because of its good after sales services. For this there are many Vivo service centres in Indian cities where customers are provided product related services. Human Resources: The most valuable asset in Vivo is employees. In recent years, Vivo hires recruits outstanding talent to its ranks in the areas of product design, user interface, brand promotion and sales and marketing. Vivo also hire the professionals’ employees from across the globe that makes Vivo increases their diversity, challenging, vital and encouraging.

6. What are the key factors for competitive success?  Apart from the value chain and the technology, factors that play an important role in gaining competitive success are:  Pricing is one important element that shall decide the fate of a mobile phone instrument. Recent surveys suggested that Indian Mobile Phone manufacturing Companies have gained considerable market advantage and forayed into the MNCs (Multi National Corporations like Nokia, Samsung, Sony Erickson, LG, etc.) markets due to the pricing advantage. This is noticed especially under the Rs. 5000 category. Vivo has been able to use this factor to its advantage. It manufactures budget friendly mobiles and has a wide reach over the youngsters specially. They provide the best value for money smart phones.

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Product Differentiation (Features) plays a key role in consumer decision making. This is clearly evident from the rise of sales of internet mobile phones. Companies that have given access to the net with speed and accuracy are marching ahead in this segment. Vivo introduced the fingerprint scanner unlock, vivoCloud, Smart Motion and Air Operations feature which set them apart from others. The most popular features other than calling are Music Player (MP3), Internet, Touch Screen, and Dual Sim. Promotion plays a vital role in making or breaking a brand. It is not enough to have good product and pricing strategy but it is of immense significance to have a broad band of promotional programmes. Hence Vivo has used various mediums for the same like sponsoring various sports events across the world, product placement in the big banners like Marvel Studios, etc.