Chinese smartphone manufacturer Vivo has reportedly decided to merge its popular sub-brand iQoo into its core business operations. The move comes as part of the company’s strategy to reduce costs and increase efficiency amidst a challenging market environment.
According to a report by Chinese publication 36Kr, Vivo and iQoo have previously shared various resources, such as R&D, supply chain, and media procurement. However, the two entities have operated independently in some segments, including planning, e-commerce-related operations, and media strategy. The upcoming integration will see iQoo’s branding and online business teams merge with Vivo’s existing teams. Vivo’s senior management has discussed the possibility of shutting down iQoo’s independent stores and counters, as per reports.
A research report by CINNO revealed that the Chinese smartphone market experienced negative growth in January, with Vivo witnessing a significant decline of 13.5 per cent. Currently, Vivo is the fifth largest player in the Chinese smartphone market. The integration of iQoo is expected to help the company consolidate its position and foster growth.
The decision to merge iQoo into Vivo’s core business is reflective of the broader trend in the tech industry, where companies are increasingly resorting to layoffs and mergers to reduce costs. This move highlights the challenges faced by smartphone manufacturers in an increasingly saturated and competitive market. With global economic uncertainty and a rapidly changing technological landscape, companies need to adapt and streamline their operations to remain competitive.
As iQoo becomes a regular lineup within Vivo’s portfolio, it remains to be seen how this merger will impact the sub-brand’s identity and product offerings. While the integration may lead to cost savings and efficiency gains for Vivo, it could also dilute iQoo’s unique selling points and brand image.
Nevertheless, the merger is a strategic decision for Vivo, as it seeks to navigate the complexities of the smartphone market and reinforce its position. The company aims to enhance its competitiveness and adapt to the ever-evolving industry landscape by consolidating resources and streamlining operations.
