Mobile Phones That See Things a Little Differently

As I've mentioned before using Oppo as an example, some Chinese companies are attempting to establish distinct brands of mobiles phones that can directly compete in China with well-known global brands. Regardless, there still remain a large number of mobile phones available made by manufacturers who seem content to leverage the brand power of other companies. Phones with names such as Nckla (Nokia), iPheon (iPhone), Mctcrcla (Motorola), etc. are not hard to find (see here and here for some examples). I'll share a favorite of mine that serves as a striking example and illustrates some important points -- including how such phones could be useful to the companies of the brands they imitate.

Here is the front side of the flip-phone when closed:

The use of Apple's old advertising slogan "Think Different" and a large section of what appears to be Apple's logo present some potential trademark-infringement issues. I've seen other mobile phones with what are at the very least Apple-ish logos, so this came as no great surprise (see here for a related challenge Apple faces in China). However, it sports an overall unique design, and the phrase "I SEE THINGS ALITTLE DIFFERENTLY" [sic] captures a common theme I've encountered while speaking with youth in China: the desire to be different, but not too different (this is not unique to China, but there are nuanced differences from other countries).

With the Apple-like branding on the front, the other side of the phone provides a bit of a surprise:

The logo on it could be described as the Oppo logo with a few modifications. For reference, Oppo's logo can be seen in the advertisement I shared in my earlier post about Oppo's "Find Me" marketing campaign:

The modified Oppo logo is important for two reasons. One, it's representative of the challenges in China that fakes and imitations pose for Chinese companies. It's not just a problem for foreign companies. Two, it suggests that Oppo has reached a perceived level of success, whether in its brand recognition or in the quality of its logo, that has motivated others to "borrow" from it. As they say, imitation is flattery.

The inside of the phone also makes use of the variation on the Oppo logo:

Additionally, it's worth noting the dedicated button for QQ -- a popular service in China for social networking ,instant messaging, games, etc . -- and the fake diamonds in the key pad. Whether such design choices reflect a keen understanding of a segment of mobile phone consumers is a question well worth answering. For example, there are other indications that a little (or a lot of) "bling" on a phone is desired by many in China (a topic for a later post).

Regardless of any imitations, it's valuable for those in the mobile phone industry to consider the ways in which a product such as this one differs from their own. The phones are openly available, sometimes produced in a very quick cycle, and can be innovative in their own ways. They won't necessarily provide all of the answers and serve as just one piece of the research that should be conducted, but some insights may be discovered that will assist in delivering products that better meet the needs or desires of consumers in China (and potentially elsewhere as well). While companies such as Apple and Oppo may be frustrated by fakes and imitations, simply taking a close look at such phones may suggest opportunities for them, in their own way, to return the flattery.

"Fake" Apple Stores in China

A "real" Apple Store in Shanghai

Last July, an American living in China wrote on her blog, BirdAbroad, about a store in Kunming, Yunnan province that in many ways looked liked a genuine Apple Store despite the fact that it was not. While some people found the story so incredible that they pondered if it was a hoax, for some in China it came as no great surprise. "Fake" can be rather common in China. In fact, just in Kunming alone police later found 22 stores "unlawfully using Apple's brand and logo". But as noted by Josh Chin on The Wall Street Journal's "China Real Time Report", the store highlighted on BirdAbroad was a jewel specimen showing the lengths some would go.

I've come across a number of "Apple stores" in a variety of other cities in China. None of the stores were on the scale of the one in Kunming, but they help paint a broader picture of the environment in China for a brand such as Apple. In that spirit, I'll share some of what I've seen in 3 of the cities I've most recently visited. For a number of the examples I'll share, I discovered them purely by chance as I walked around exploring the cities. Others where found when I deliberately visited certain shopping districts, though not because I knew I'd find stores selling Apple products there. Especially given that I wasn't deliberately seeking out such stores, I suspect that what I'm sharing is just the tip of the iceberg for these cities. To be clear, for some of the examples I can't be absolutely sure anything improper is occurring. But based on what I know and the example of the store in Kunming, there is certainly much that should at least raise some eyebrows.

Before sharing any examples of questionable sales of Apple's products or uses of its trademarks, I want to clarify one issue that I've seen cause some confusion. In addition to its official Apple Stores in China, Apple also allows select businesses to be official Apple resellers. Some of these stores only sell Apple (and Apple-related) products. Even in Shanghai where three large Apple Stores currently operate there are also numerous authorized Apple resellers where one can purchase Apple products. Here is a photo of an authorized Apple Reseller at a large shopping mall in Guangzhou, Guangdong province that is similar to many others I have seen:

Sunion is a common Apple reseller in China. I'm sure this store is legitimate not only because of the "Premium Reseller" sign prominently displayed (which of course could be faked) but also because this specific store appears on Apple's list of authorized resellers in China. While official resellers often have some of the look and feel of an Apple Store, as referenced by Loretta Chao and Sue Feng (also on The Wall Street Journal's "China Real Time Report") there are guidelines they must follow. I'm not absolutely sure if this is part of the rules, but it's worth pointing out that the above store's name does not include "Apple" in it. Also, the employees wore shirts with "Sunion" written on them - not "Apple" or an Apple logo as was found in the now famous store in Kunming.

So, as far as I could tell all looked good there, as in many other authorized stores in China.

However, in the very same mall as the store above I saw a number of other stores also selling Apple products. None of them currently appear on Apple's list of authorized resellers. For example, there was this store with "iPhone 4" displayed where a store name is typically located:

An "iPhone 4" store

To provide some context, this section of the mall had numerous stores with their apparent "real" name posted in the same relative location above their main entrance. This store's business card did not indicate "iPhone 4" and instead provided a nondescript Chinese name for the business. The store sold a variety of Apple products such as iPhones and iPads. In addition to the Apple-like feel of the store, I also noticed PC monitors which did not appear to be Apple products with stickers of Apple's logo on them. You can see a hint of one in the photo.

Also of relevance is the logo in the red sign on the left side of the picture. It's China Unicom's logo for its WCDMA 3G Network. China Unicom has an agreement with Apple that allows it to sell iPhones. China Unicom also has an online list of dealers and currently this store is not listed there either. Even if the store should be on the list, its sales of non-iPhone products, the choice of the displayed store name, etc. remain issues.

There were other stores selling Apple products, many also with Apple-labeled PC monitors. And some stores weren't content with naming themselves "iPhone 4", but instead chose "iPhone 4S":

An "iPhone 4S" store

iPhone, iPhone 4S, and Android too

The use of "iPhone 4s" was particularly fascinating since the iPhone 4S hadn't been authorized for sale in China when I visited any of these stores. In fact, its launch date is this Friday, January 13. So, what's the source for these phones which shouldn't be available in Guangzhou?

I spoke to assistants at several stores and they all told me the same story: the phones are purchased from nearby Hong Kong and brought to Guangzhou. They were very open about the source of the phones and one shop even had a sign stating the Hong Kong origin of the iPhone 4S phones:

When I asked an assistant at the authorized Sunion store whether I could purchase an iPhone 4S she told me it would not be possible since they weren't available for sale in China. When I asked her why the other stores in the same mall already had them available she looked disgusted but refused to comment.

So, these examples are from just one mall and more exist there than what I've shared here. If you think that's a lot of iPhone stores to peruse in a single mall I can recommend you also visit the Starbucks a few levels below them (which I assume is genuine). Anyways, this is just a small taste of what you could likely find in Guangzhou. In other parts of the city I also noticed several stores with signs indicating they were authorized Apple resellers despite these stores not appearing on Apple's online list.

Is this store really authorized by Apple?

Maybe Apple's online list is not up to date. I did not contact Apple to check.

The examples from Guangzhou are striking, but it is one of China's more developed cities and may not be representative. What can be found in less prominent cities? Hengyang, Hunan province was another city I recently visited, and it provided a number of intriguing examples as well. Here's one store with an Apple logo prominently displayed:

It actually sold a broad variety of phones, but there was also a store nearby that focused on Apple products:

This store sold iPhone and HTC products:

Inside of the store

And this store claimed to be an authorized reseller:

Now here's the kicker. Apple doesn't list one single authorized retailer in all of Hengyang. China Unicom does list one authorized reseller in the area I visited, though the address doesn't appear to be for the store above.

After Hengyang I visited Chenzhou, also in Hunan province. I should note that like Hengyang when I visited Chenzhou I hadn't expected to be taking photographs of stores selling Apple products. However, one day I was walking down a street and saw these stores all in close proximity to each other:

Get the point? And like Hengyang, Apple lists no authorized stores in Chenzhou and none of these locations are currently listed on China Unicom's site. Again, some of the stores might simply be missing from the lists.

All of the stores above from Guangzhou, Hengyang, and Chenzhou were very much out in the open and in highly-trafficked areas. Never did anyone ask me to not take photographs. In fact, in several of the "iPhone" stores employees were happy when I asked if I could take their photos. While they might not have thought they were really working for Apple as in the case in Kunming, I didn't get the sense that they had a feeling there was anything they might not want to be fully public.

So, it doesn't appear that Kunming is the only city with "creative" uses of the Apple brand, and I feel pretty safe in saying that Guangzhou, Hengyang, and Chenzhou are not unique in joining Kunming in this respect. Again, I'm not saying I'm sure that everything I've shared here is "bad", but there is certainly much that seems amiss. Perhaps most clear is that the sales of the iPhone 4S should not have been occurring.

All of this presents a mixed case of good and bad news for Apple. At least if the stores are selling genuine Apple products (which is another issue to explore) then presumably Apple is at least profiting from the sales, even if not in the manner they would like. It's a very different problem than what Microsoft faces with many people in China using pirated versions of Windows.

So while there are numerous locations in China where one can legitimately purchase Apple's products, it appears there may be many more locations where sales are less than proper. Whatever benefits there may be for Apple in reducing the number of "fake" Apple stores in China, there would mostly likely exist direct benefits for the properly authorized (and presumably Chinese-owned) reseller stores.

And by the way, I've noticed some other retailers who are indeed very careful not to improperly use Apple's logo or its products' names:

On a sidewalk in Chenzhou

They just sell products that look remarkably like Apple's -- but for much cheaper of course.

Steve Jobs and the New Apple Store in Hong Kong

By now, you're likely aware of the death of Steve Jobs.  Many fascinating insights on Steve Jobs's life have already been shared online.  This paragraph from an article on Wired by Steven Levy particularly caught my attention:

Jobs usually had little interest in public self-analysis, but every so often he’d drop a clue to what made him tick. Once he recalled for me some of the long summers of his youth. I’m a big believer in boredom,” he told me. Boredom allows one to indulge in curiosity, he explained, and “out of curiosity comes everything.” The man who popularized personal computers and smartphones — machines that would draw our attention like a flame attracts gnats — worried about the future of boredom. “All the [technology] stuff is wonderful, but having nothing to do can be wonderful, too.”

Like elsewhere in the world, there has been some strong reaction in China to Steve Jobs's death.  Josh Chin and and Owen Fletcher on The Wall Street Journal's "China Real Time Report" capture some of the online reaction.  Laurie Burkitt, also for China Real Time Report, highlights the reaction outside an Apple retail store in Bejing as does C. Custer for Penn Olson with a video.  CNN's "News Stream" describes the similar reaction at an Apple store in Hong Kong.

The Hong Kong store is notable since it is Hong Kong's first and opened very recently.  I was able to stop by a couple of weeks ago on its second day of operation and found both floors to be packed with people that weekend:

Half of first floor of Hong Kong's first Apple Store the day after its grand opening

This called to mind the opening of Best Buy's first store in China.  At the time I was able to chat with a Best Buy "Expat-Manager" who planned to work in Shanghai at least until the store's operations were stable.  He excitedly said that he was amazed by the number of people in the store and couldn't imagine a better start.  My first thought was that especially in China crowds don't necessarily equate sales.  More telling to me than the crowds was the lack of activity at the checkout counters.  Now, there are no Best Buy stores in China (they still own a local chain of stores, though).

However, Apple's stores in China have been doing quite well in terms of sales and during my brief visit to the HK store there were numerous instances of actual purchases:

At the Hong Kong Apple Store checkout counter

One of the most impressive aspects of Apple is the connection many people feel with its products and its brand.  For example, in Hong Kong I saw numerous people having their photos taken in front of the store:

Or on the famous staircase:

I think the Apple employee is trying to tell them that taking photos on the stairs creates a bit of a traffic jam.

Or on the 2nd floor in front of the Apple logo:

When I stopped by again two days later the crowds were smaller (it was a weekday) but there were still plenty of people taking photos:

The scenes were particularly striking to me since during a visit several months ago to the Apple Store in Shanghai I was told I could not take photos inside.  However, not only were numerous customers taking photos in the Hong Kong store but Apple employees were sometimes assisting.

I spoke to two Apple employees from the US who were temporarily working in Hong Kong.  They couldn't comment on the Shanghai store but they said that at least in Hong Kong and the US they would allow people to take photos for personal purposes (they also said I could use them as long as my blog wasn't for profit).  When asked to reflect on their Hong Kong experience (so far) they said that the behavior of the customers, including the photo taking, was similar to what they've seen in the US and the main difference was that everything was on a much larger scale in Hong Kong.

I think the taking of photos at Apple Stores isn't only significant for what it says about the incredible image Apple has created for itself.  It also highlights a somewhat hidden value of the stores.  Not only do they offer a chance for Apple to directly sell its products in an environment of their choosing, but they provide a real-world location for people to connect with Apple in a very direct fashion.

Now, in what is a sad moment for many it also serves as a place for some to pay their respects to Steve Jobs.  And just like people wanting to photograph themselves in the Apple Store, I think it says much about what Jobs helped create for both Apple and its customers.