Is OnePlus Changing Its Strategy – Strategy With RS

Did you notice the advertisement released in today’s Times of India (Mumbai edition) – referenced above.

It seems that OnePlus is straying away from the strategy that catapulted it to pinnacles of success.

What was OnePlus’ strategy?

It had intelligently embedded principles of Behavioral Sciences into its Business Model.

Behavioral Sciences principles seeks to understand why people intuitively / subconsciously behave the way they do – without much or any persuasion. Then companies seek to strategically embed these principles into their business model & place triggers, which get customers to behave the way, they desire.

Let us come to OnePlus.

They have embedded 3 principles of behavioral Sciences into their business model:

1. Scarcity Effect: Anything that is scare becomes valuable to humans. By making OnePlus accessible ‘By Invite Only’ ensured that it was not easily available – hence it became ‘valuable’ & desirable.

2. Social Proof: When I handled Bagpiper whiskey, we always put in every communication, ‘India’s largest selling whiskey’. What was the objective? To subliminally indicate to people who were not buying Bagpiper that if it is India’s largest selling whiskey then large number of people must be buying it – and so many people cannot be wrong. Let us come to OnePlus – because it is available only through invite, hence it becomes valuable & desirable. What happens next? People frantically send message to each other to find out who has an invite & then request them to share it … when people see so ‘many’ of there friends frantically searching for an invite it subliminally indicate to them that OnePlus has to be good … because so many people cannot be wrong.

3. Tribal Feeling: For survival, evolutionary biology has encoded in all humans to belong / be a part of a ‘tribe’. Today when we can survive ‘alone’ even then this feeling persists. The ‘invite’ strategy seems to indicate to people, who have not got an invite, that they are not a part of the tribe … and they make effort to join it.

What did embedding these Behavioural Sciences strategy do for OnePlus?

It helped ‘differentiate’ itself; carve out a unique place for them & stand out in the crowded Hand set market.
The advertisement seems to indicate that OnePlus seems to be jettisoning its ‘Invite Only’ strategy. By doing it is following the footsteps of its peers .

This will make them similar / undistinguished form their peers. And in the long run it could become fatal.

I can sense a question taking root in you mind?

Can’t a company change its strategy over time?

Of course it can. But the new strategy should make it more unique … more differentiated compared to its competitors – not make them ‘same’.

By change in its strategy OnePlus may become undifferentiated vis-a-vias its competitors. And in the long run it can prove to be fatal.

Yes, I understand this shift in strategy is only for 3 days. But the moment a company deviates form its chosen strategy, even if it is for a limited time only, then the cleverly embedded principle of behavioral sciences become less potent to influence its users behavior.

By pursing this short term strategy OnePlus is shifting from creating a phone that uses desire & seek out to selling more & more handsets to make more & more profit – just like there peers.

Result – in the short run they will succeed but in the long run they may come to grief.

BTW the OnePlus 2 handset is an extremely great product.

Friends I have candidly shared my take on there strategy. What do you feel about it? I look forward to your comments.

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rajesh-srivastava-insideiim

 

In this series, Rajesh Srivastava, Business Strategist and Visiting Faculty at IIM Indore gives you a regular dose of strategy case studies to help you think and keep you one step ahead as a professional as compared to your peers. Rajesh is an alumnus of IIM Bangalore and IIT Kanpur and has over 2 decades of experience in the FMCG industry. All previous Strategy with RS posts can be found here

Comments

10 comments

Sajal Singh

It could also be that the company hasnt seen the kind of sales it was expecting, suggesting that maybe people are not really trying to find invites or are not interested in their phone. “(CEO) Pei is acutely aware of the criticism the company’s invite system receives. He also acknowledged that people will only wait so long to buy one of his phones before they look elsewhere. So will he ever ditch the invite system altogether for a device’s launch, perhaps with the OnePlus 3? “Maybe in a few years,” he said.” and therefore moved towards a 3 days sale to make their scarcity effect more ‘visible’ to everyone. First, Its still scarce and it might help those who have been trying to find an invite but unable to find one. Second, it might draw new eyeballs, a percetage of which might convert to sale(“CEO: OnePlus doesn’t really exist offline yet — unless you pay close attention to the online tech world, there’s a good chance you’ll never encounter the brand. So theres scope here”) a.k.a newspapers in india, retail etc. Third, some inventory might be left over.

Excerpts: http://venturebeat.com/2015/11/14/oneplus-founder-talks-nfc-invite-system-never-settle/

Rajesh Srivastava

Sajal you could be right about falling sales. 1. The Invite strategy had catapulted OnePlus to differentiate itself. But that strategy worked because the product was awesome – compared to competition. Today the Brand may be facing problem because it may not have refreshed the strategy.
In brief other brands may have traversed a greater distance than OnePlus.

ramji yahoo

These is a chance of backfiring in this way. Crazy /egoistic customers like me thinks, why have I not received the invitation at first from the company rather than to receive an invite from a friend. I am think that the vendor discriminates the customers and have not given enough preference to me. (How is this point covered?)

Rajesh Srivastava

Ramji, there will always be exception … people like yourself. But a strategy is not designed to please 100% of customers. It is designed to please majority of customers. In the bargain if a few customers are dissatisfied … so be it.

Rajesh Srivastava

Ramji I am unable to understand your question… please clarify… so that I can respond.

Navin Gurnani

I see One Plus invite only model more of an operational issue. They might be initially skeptical of initially having a full fledged launch. One Plus One being their first product. Also, the strategy worked because took the product to be precious. I think what they are doing now is trying to pivot the strategy to check how flexible the customers are in a no invite only mode. Comments welcome.

Rajesh Srivastava

Navin OnePlus model, in my opinion is not an ‘operational issue’. It is a strategic initiative which is based on principles of Behavioural Sciences. I am taking the liberty of sharing a link of a video I have done on Behavioural Sciences – do view it at your convenience… now it seems they are ‘pivoting’ ….
https://www.youtube.com/watch?v=lZVDe26J3ZA