The manufacturer has admitted an internal review has turned up painful results and although its new marketing campaign looks impressive, Michael Garwood says it can’t afford to make any more mistakes
It’s been a tough few years for HTC. From consecutive quarterly profit losses (peaking at over 90 per cent in the last quarter of 2012) to delays in the launch of its flagship HTC One smartphone, the company has been forced to take a long, hard look at where it went wrong.
To its credit it has, recently completing an internal review which turned up “painful” results, according to a refreshingly honest HTC VP of marketing for EMEA Martin Kang. Six months of looking in the mirror and HTC has admitted that what it stands for has been “lost”.
Kang’s comments confirm those made in January when CEO Peter Chou admitted a “lack of marketing” was partly responsible for a tumble in profits and sales. Unlike some, however, its words have not just been a load of hot air.
The use of Hollywood star Robert Downey Jr seems like a shrewd move – and an expensive one given the £15 million HTC reportedly paid for his services.
But his inclusion is not about discussing products and features but about showing the brand in a different light. Kang said the brand wants to be seen as playful, and the ads certainly suggest that. They’ve definitely proved popular online, with more than 1.3 million views in the first few days of release.
But aside from all the fun and games of car-washing trolls and bizarre HTC acronyms, the underlying message remains key, and it is that HTC is a manufacturer built on innovation and change.
Looking at its history, it’s hard to deny the firm has played a significant role in the way the market looks today.
It is hard to believe given its well-documented financial and market share troubles.
Industry firsts to its name have been far from insignificant, such as having the device with the world’s biggest screen or thinnest body.
Examples include building the first touchscreen mobile devices in 1998 (for HP and Palm). It was also the first to offer Microsoft-powered smartphones in 2002 (XDA range). Significantly, it was the first manufacturer to launch an Android-enabled device, with the G1 in 2008, and was the first to offer a 4G-capable handset in 2010 (in the US).
Not bad for a company which was only founded in 1997 and didn’t start selling under its own brand name until the midnoughties.
But while on paper this all sounds good, it means nothing to the end user.
Kang pointed to Samsung’s seemingly bottomless marketing budget, which has undoubtedly aided its drive to be number one in the world.
After all, can anyone argue that Samsung handsets offer better quality and features than, say, an HTC or Sony? Probably not.
To put it into perspective, HTC has a $1 billion treasure chest for marketing this year – the same as Apple’s in 2012 – which is around $3 billion less than Samsung.
This only heaps more pressure on HTC to ensure the latest star-gaze works and that its message gets through to the end user immediately – rather than them being constantly reminded by endless adverts.
But HTC has learned from past mistakes – so it says, at least – and is being smarter with its cash than in previous years, committing more of that sum to its biggest markets, including the UK.
And the continued sponsorship of UEFA is a master stroke, guaranteeing its brand is exposed to hundreds of million of sports fans around the world every month through Europa Cup and Champions League matches.
Time will tell if the new HTC can achieve its ambitions but given its financial state, it simply cannot afford to score any more own goals.