vivo to Launch New Sub-Brand Jovi in 2025: A Look at the Advantages and Disadvantages of Smartphone Sub-Brand Strategies

vivo to Launch New Sub-Brand Jovi in 2025: A Look at the Advantages and Disadvantages of Smartphone Sub-Brand StrategiesWho would have thought vivo is launching another brand? On December 16th, foreign media reported that vivo will launch a new sub-brand, Jovi, in 2025, tentatively targeting overseas markets. Interestingly, Jovi is also the name of vivo's voice assistant, sparking speculation that this sub-brand will focus on AI-powered smartphones

vivo to Launch New Sub-Brand Jovi in 2025: A Look at the Advantages and Disadvantages of Smartphone Sub-Brand Strategies

Who would have thought vivo is launching another brand? On December 16th, foreign media reported that vivo will launch a new sub-brand, Jovi, in 2025, tentatively targeting overseas markets. Interestingly, Jovi is also the name of vivo's voice assistant, sparking speculation that this sub-brand will focus on AI-powered smartphones. In recent years, many smartphone manufacturers have launched sub-brands, fueling a trend of "having more children to fight better." What's the deeper logic behind this surge?

Foreign media reports indicate that the Jovi sub-brand will initially launch only in the Brazilian market, with the first three models being previously released mid-to-low-end vivo products. Lacking novelty, they are not expected to impact vivo and iQOO brands domestically. Given vivo's strong brand recognition and influence, why the need for a sub-brand? One possible reason is that vivo doesn't want to be labeled as a "low-end phone maker" in the Brazilian market. Data shows that the Brazilian market is dominated by low-end and entry-level phones, with average prices ranging from 700 reais (approximately 831 RMB) to 999 reais (approximately 1187 RMB). To improve overseas profit margins, phone manufacturers can no longer rely on a strategy of primarily focusing on mid-to-low-end products domestically and secondarily on high-end ones. They need to establish a high-end brand image directly. A brand name change might be a suitable solution.

This strategy is also reflected in the domestic market. Xiaomi launched Redmi (now REDMI) in 2013, achieving astonishing sales of 44.6 million units with its incredibly low price of 799 RMB and decent specifications, becoming a landmark product in the Chinese smartphone market. Huawei's subsequent Honor sub-brand (now independent) also achieved excellent market performance, reportedly contributing 60% of Huawei's total sales in 2018. In 2018 and 2019, OPPO and vivo also successively launched sub-brands, achieving significant success.

This demonstrates the reasons behind smartphone manufacturers' enthusiasm for sub-brands. First, sub-brands help manufacturers segment their product lines, allowing the main brand to focus on high-end flagships and offline markets, while sub-brands target online markets and cost-effective options. Second, sub-brands can alleviate negative perceptions associated with the main brand, such as "high cost-performance" implying lower quality, thus protecting the main brand's image and positioning. This differentiation strategy not only enhances overall competitiveness but also provides consumers with more choices. Simply put, a successful sub-brand can boost sales and even become the brand's main sales driver. vivo's other sub-brand, iQOO, is the best example. IDC data shows that vivo held the top spot in the domestic market share for the first three quarters of 2024, while iQOO contributed approximately 5% of the market share (average), making it one of the most successful sub-brands.

However, sub-brands are not without flaws. Many consumers unfamiliar with the smartphone market are unaware of sub-brands; for example, many people don't know that realme belongs to OPPO, or iQOO to vivo, sometimes mistaking them for obscure "no-name brands." The author once purchased a realme phone for a family member. While its cost-performance was excellent, the older generation was hesitant due to unfamiliarity with the brand, fearing potential problems. The phone was replaced with an OPPO flagship model within a year. This, however, might be the desired outcome of differentiation for smartphone manufacturers, facilitating the development of the parent brand and enabling more precise segmentation of the consumer market.

Furthermore, smartphone manufacturers often employ a "sea of phones" strategy, with countless Note, Neo, GT, and Turbo series flooding the market, making it difficult for consumers to distinguish the focus of different product lines. This "matryoshka doll" phenomenon is prevalent, with a phone quickly relaunched as a new model after a minor change in casing or processor, accelerating inventory turnover for manufacturers.

Today's consumers are increasingly discerning. They seek products that genuinely solve problems and offer value, not rebranded iterations. Otherwise, numerous sub-brands will only be fleeting phenomena.

More importantly, sub-brands can encroach on the parent brand's market share. Taking iQOO and vivo as an example, the iQOO 11 Pro, released at the end of 2022, surpassed the vivo X90 Pro in performance, screen, battery life, and charging, only slightly lagging in camera capabilities and build quality. Both phones were priced at 4999 RMB, making the comparison clear. vivo is not the only manufacturer "betrayed" by its sub-brand. In 2019, the Redmi K20 Pro Premium Edition outperformed the Xiaomi 9 with a lower price, better battery life, and performance, making the Xiaomi 9 the most "awkward" generation in the Xiaomi numbered series. The Meizu Blue series once accounted for half of Meizu's sales but was discontinued due to competition with Meizu's flagship phones. The Honor 30 series surpassed the Huawei Nova 6 series, and OnePlus 8 series sales far exceeded the OPPO Find X2 series; these examples are numerous. Almost every smartphone manufacturer has experienced the awkward situation of a sub-brand surpassing the parent brand.

The initial intention of a sub-brand is to highlight the parent brand's advantages, not to compete with it. Therefore, sub-brand flagships often compromise in certain aspects, most notably the imaging system. The parent brand's camera collaborations and algorithms are usually not transferred to sub-brands because camera algorithms are a true technological moat, a key differentiator between flagship and non-flagship phones. If even the camera algorithms are transferred, the high-end product line will lose its competitiveness.

Therefore, manufacturers need to clearly define the boundaries between the main brand and sub-brands, ensuring their positioning does not conflict, to achieve true complementarity. If the parent brand and sub-brand have consistent positioning, it is likely that the sub-brand will surpass the parent brand or the sub-brand will lower the overall brand image. Currently, manufacturers have largely clarified the relationship between flagship phones and sub-brands, and the situation of sub-brands surpassing parent brands should not happen again.

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