Asus, a company better known for PC components than smartphones, has just caused quite a ripple in the market by launching the brand new ZenFone Max Pro M1 (Review) in direct competition with the Redmi Note 5 Pro (Review). However, unlike Xiaomi which has had a few years to build its reputation in India, Asus is starting from a relatively blank slate in the smartphone space. We now know all about the device's specifications and performance, having spent enough time with it to review it in depth. We also know that Asus has partnered with Flipkart for ZenFone Max Pro M1 sales and logistics, and that the two companies are targeting a huge chunk of the Indian market.
What we didn't know until just before the launch is that this device is the result of a pretty massive shakeup inside the company; an effort that began over six months ago. Will the low price of the new ZenFone Max Pro M1 be enough to delight customers, and will the high-profile partnership with Flipkart help the company leap to the top of the Indian marketshare charts? Gadgets 360 met up with Asus CEO, Jerry Shen; COO, Jerry Tsao; India Regional Head, Leon Yu; and Mobile Product Division Director, Dinesh Sharma on the eve of the device's launch, to ask them these questions and more.
When we last heard from the company at MWC 2018, CEO Jerry Shen had spoken to Gadgets 360 under a non-disclosure agreement about the top-end ZenFone 5z and ZenFone 5 (First Impressions), as well as the mid-range ZenFone 5 Lite and ZenFone Max M1, which we now know will not be launched in India. Why the change, we asked, and at what point did Asus decide to develop products like the ZenFone Max Pro M1 exclusively for India?
"When we try to develop products, the most important thing in my mind is that the experience is everything," says Shen. "Once we have a really good experience, we can talk about the price, the efficiency, and everything else. We know the people here like very premium specifications. They say 'Oh, this is the processor', and they check every detail of everything. So we wanted to provide a really good processor."
"The camera is also a key part of the experience," he continues about the ZenFone Max Pro M1. "And then it has to look premium. We think that premium products can be affordable, and at affordable prices it is not necessary to be ugly. We tried to create this product for the user here."
Dinesh Sharma, who spearheaded the effort in India, adds: "India is one of our key focus markets, and to make big gains we wanted to obviously develop products which indian consumers want. To gain insights about Indian consumers, we conducted research at various levels covering 1000+ customers."
"Once we had this on the table, we got great collaboration and support from Jerry [Shen], Jerry Tsao, and the entire HQ team in terms of creating the products which would be right for the India market and bringing them in at the right prices," he continues. "You've now experienced the ZenFone Max Pro M1 and you've got a very good idea about how it compares with other products in its segment."
Sharma says Asus wants to achieve "double-digit market share" as soon as possible. "We are starting with the ZenFone Max Pro M1, and then we will bring in other products," he adds. "We don't share our internal sales numbers, but we do have a very aggressive target."
What other products, we ask? Which other price points will Asus apply its new strategy to? All that Jerry Shen would say is "We will try to cover buyers in all price segments".
Sharma is a little bit more forthcoming, "We should say Rs. 5,000 to Rs. 50,000," he explains. "Basically, this is about 85 percent of the market. You will see us across segments, and each model will try to be the hero in that segment. The bulk of the market is actually sitting between Rs. 5,000 and Rs. 20,000, and that's critical because it will give us the mass and market share."
Asus knows that it is going to cause a huge stir in the market. We asked CEO Jerry Shen what kind of demand he is expecting, and how he has prepared for it. "I cannot tell you the number, but we think the demand will be very strong, and so we have prepared for that," he says. "From materials to manufacturing, we have prepared a lot."
That sounds good, but Indian customers are growing tired or flash sales and products that are never in stock. Shen says there will be no flash sales. "We try our best to provide enough," he says. "We know the strategies and policies of our competitors, but we do business sincerely with the consumers here."
"The intent is not to create artificial scarcity," says Sharma. "It's exactly the opposite, in fact. The more we deliver, and since we believe that the product is actually very good, the better it is for us as a brand. If the demand is indeed very good, we would like to service it to the best extent possible and not create an artificial scarcity with the marketing objective of that leading to more word-of-mouth."
According to Shen, Flipkart had a role to play in deciding what the ZenFone Max Pro M1 would turn out to be. "On the product side, Flipkart has very deep product and marketing insight," he says. "We discussed with Flipkart what real customers want, so we could adjust and fine-tune it."
We asked Shen for specific examples of how Flipkart influenced the choices that were made regarding this phone's specifications and features. "They give us the price ranges and tell us which products are leading," he explains. "Different price ranges have different priorities, so if we want to target different price points, we know the priorities from Flipkart's insight."
Things don't end for a buyer after his or her phone is delivered. There's still the question of customer support and service. We asked the Asus management team whether it's happy with its after-sales network. Leon Yu, India Regional Head, took that question.
"Currently, we have more than 200 service centres, we have free carry-in service, and for remote areas we have free pickup-and-drop service," he says, while Sharma adds that Asus service centres provide "invoice-free service."
"In our case, if the product has been activated, we calculate whether it's within the warranty period, and you actually get invoice-free service at our service centres," he says.
One thing we noticed about our ZenFone Max Pro M1 review unit is that it wasn't made in India. Other manufacturers are racing to take advantage of the governments tax breaks to companies that set up local manufacturing facilities, so we were curious about Asus' strategy. Jerry Tsao, COO, answers that question.
"From a manufacturing standpoint, generally we work with our partners," he says. "Today, we do have partners in India, and from an operations standpoint we'll continue working with them to see how to deliver so that they can manufacture in India, but our number one goal today is to try to deliver the best product for India."
In other words, it's about getting the product to market in time, and while factories in China are the better choice right now, factories in India will take over when they can.
The ZenFone Max Pro M1 will be getting a lot of attention because of its class-leading processor and a big battery, but one of its most important features, and a big departure for Asus, is the use of stock Android rather than ZenUI. We've seen how proud the company is of every little customisation and tweak in ZenUI, as well as its in-house apps. We asked Jerry Shen about the reasoning behind this, and how difficult it was to accept this change.
"It's always been a debate inside the product development team," he says. "I think the world is almost divided into two. Some countries really like stock Android; some countries think ZenUI is better. We want to hear these two voices and provide both."
Sharma steps in to offer more details.
"India is like countries within countries, and in our consumer research it really came out that this segment of customers prefers stock Android, so we wanted to give it a good try and see the results," he says. "It doesn't mean that we're not going to be focusing on ZenUI; it's going to have equal or much more focus for other segments. And ZenUI has also been made far snappier, version 5.0 has very few preinstalled applications and the UI is much cleaner. In any case, from an experience perspective we're going in the same direction - it's faster, and meant for quick updates."
"If it succeeds, we will continue with it," Sharma explains. "We're not saying it's a one-off. It's been done with a belief that it will succeed."
Is Asus ZenFone Max Pro M1 a Xiaomi Redmi Note 5 Pro killer? We discuss that on Orbital, our weekly technology podcast, which you can subscribe to via Apple Podcasts or RSS, download the episode, or just hit the play button below.