EXCLUSIVE: Huawei Close Down Westfield Kiosks, Staff Incentivised To Buy P9
Chinese smartphone Company Huawei, has moved to shut down several kiosks in Westfield shopping centres due to a poor response to the Companies “sell direct” marketing initiative.
ChannelNews understands that of the 11 Huawei kiosks rolled out 6 are set to be closed down.
A Company Spokesperson said “Several kiosks around the country are currently relocating and new kiosks will be opened shortly. At this stage Huawei will keep five kiosks up and running situated in Chatswood, Parramatta, Hurstville and Burswood in New South Wales and in Caroussel, Melbourne Victoria. The company is currently exploring new locations across the country”.
ChannelNews understands that the Companies Burswood WA kiosk has also been closed.
They added “The current and new kiosks will be redesigned to better meet Huawei’s customer’s needs and give customers more options when visiting a Huawei kiosk”.
“Customers can test and get hands-on experience with new or upcoming smartphones, tablets, smart watches and other devices, organise or extend their contracts and now quick fix repairs are also added to Huawei’s customer service to create a better customer experience”.
The Company has not said why they felt they had to move to kiosks that compete head on with carriers for sales.
Initially the kiosks were launched as information booths, however an investigation by ChannelNews revealed that the Company had moved to selling direct in competition with Telstra, Optus and Vodafone as well as mass retailers who sold their handsets.
This is not the first time that an Asian vendors direct sell marketing program has gone pear shaped.
Acer were forced to withdraw their kiosks from Westfield shopping centres due to a combination of high Westfield costs and a poor response by consumers who research shows prefer to deal directly with a carrier or a specialled consumer electronics store such as JB Hi Fi.
Huawei Technologies Australia who are struggling to grow their smartphone business in Australia have in an effort to get traction for their new P9 smartphone rolled out an internal marketing program whereby hundreds of their staff were given the opportunity to buy the $780 smartphone for $100.
Staff were told by an internal memo that if they went to a Huawei kiosk or retail store and purchased a P9 that the Chinese Company would rebate them the cost of the purchase less $100.
The staff were also told that they had to make the purchase within the first week of the smartphones launch in June and that they could claim the rebate back “one month later”.
It’s not known whether the sales will count as a “genuine” sale for the purpose of IDC research.
The Huawei Technologies (Australia) group, which consists of carrier, consumer and enterprise operations, racked up $484 million of sales for the year ending 31 December 2014, growth of 18 percent over $407.8 million the previous year.
The Australian arm of the multinational vendor made $3 million of net profit in 2014, down from $7.7 million in 2013.
Huawei Australia boasted that the enterprise arm increased its sales by 419 percent year-on-year.
The Company has not said whether their consumer business that spans smartphones, watches and mobile devices is profitable, or how much revenue is being generated in Australia.