Company President Mikhail Nikolayev, Just5 created the first Russian mobile phone that is interested in Wal-Mart and Amazon. Inventing a machine for retirees, he captured the hipsters, bikers and fishermen.
Since the middle of last year Just5 phones can be purchased at TigerDirect, Frys and other major U.S. networks and from the beginning of 2011 by Amazon.com and Wal-Mart. In Europe Just5 sell their contracts with major mobile operators Vodafone and Orange. In 2010, Just5 sold about 200 million handsets, and its revenues are estimated SF, amounted to approximately $ 20 million sales is small. In comparison, the global market leader in the Finnish Nokia has just sold in Russia last year, 14.7 million phones. However, before any of the Russian manufacturers are not able to settle marketing abroad. Now half Just5 vehicles were sold in the United States and Europe.
Mikhail Nikolayev said in English, but knows how to stand out from the crowd of manufacturers. He began to produce extremely simple phones with a single melody and a monochrome screen, but with the orange charging and stylish body. So small Russian company has found a place in the market, where seasoned giants — Nokia, Samsung and Sony Ericsson.
We discussed — I decided
Mikhail Nikolayev collapsed in a funny orange semi-circular seat, which is appropriate in the cafe than in the office. At the next table is overwritten by e-mail with wholesalers CEO of the Russian branch Just5 Roman Zverev. Two more people work in the U.S. office in Las Vegas and two in Europe — in Riga. That's the whole company. So, each employee earns the company more than $ 3 million According to the Society for Human Resource Management, the U.S. national average per employee has $ 250 million in revenue.
Accounting, Logistics (three warehouses — one in the United States, Russia and the Baltic States) to outsource. Appearance phones engaged Gleb Ilyusha — designer, artist and musician (he is, for example, came up with the design for the cigarette brand Richmond). Legal support to the project is provided by the international company Baker &McKenzie.
"The main thing — not to produce the secretaries and managers who sit all day in the" in contact. "The fewer people, the better," — says Nikolaev and he pours himself a coffee and a correspondent SF. Four of the six members of the company — Michael Spector, Alex Yakushonok Dmitry Matseralik and Roman Zverev — own small stakes in the company. "We are a democracy with an authoritarian management style. We have discussed and decided," — laughing businessman. "He gathered telecom riot — they're all incredibly efficient guys. Lesser forces are doing what corporations are engaged in departments of several hundred people," — admits director of marketing network ION Willie Hooks.
Company "Orbita Telecom", which last year was renamed the Just5, Michael created in 2007. In the words of Nikolayev, the partners' risky chipped in on the last money. " A graduate of the Abakan Pedagogical Institute Mikhail Nikolayev in the late 1980s fartseval in foreign exchange shops — bought from foreigners and resold Western clothes. "Until now looking into jeans or sneakers -" firm "from a fake at a glance I can tell," — he boasts. In 1995, two years earlier than Chichvarkin created "Euroset", Nikolaev founded the company "Mobitel", which became open cellular shops in Moscow and the Moscow region. In 2002, Nikolaev opened several stores under the brand name of "Megaphone", which sold contracts only this operator. Prior to his work in this format only retail outlets affiliated with the mobile operators. However, Nicholas decided to take a chance. "Misha — Collegiate positive guy, not afraid to experiment. Positions" MegaFon ", then in the metropolitan area have been weak, but we are the first to introduce" free incoming "and sales began to grow rapidly." Mobitel "on this well-earned" — says Eldar Razroyev who worked in 2002-2004, the commercial director of "Megaphone". Nikolaev hoped that over time the operator will give it to develop its own sales network. But changed direction, and "Megaphone" has become to develop the network itself.
In total, by 2006, Nikolaev able to open more than 300 stores "Mobitel" and dozens of "Megaphone". According to "SPARK-Interfax", the proceeds LLC "Mobitel" in 2006 amounted to 191 million rubles. However, competitors have developed a much more aggressive. In 2006, at the "Euroset" was more than 5 thousand salons, the "liaison" — 1.2 thousand shook Market price wars, and small networks becoming more difficult. "One took off the price, twice, three times, but in the end we sit all without margin" — says Nikolaev. Although the company has grown its revenues, profits declined. In 2006, she was, according to "SPARK-Interfax", 834 thousand rubles., Two years earlier — 7.5 million rubles.
In 2007, Nicholas sold some stores "MegaFon" part — close competitors, and most just closed. "It was a great stroke of luck that I went out of business with small losses," — says the businessman now. During the crisis, many mobile retailers, including "Betalink", "Dixis", "Tsifrograd" went bankrupt. Now "Euroset" and "The Messenger" so enthusiastic about lower prices, that market participants are selling many models at a loss. Nikolaev decided to create a phone that is able to make himself, and retailers.
He gathered telecom commandos. they are doing what corporations are engaged in hundreds of people
"They told me you fool goner. Motorola leaves the cell phone market, and you go," — says Mikhail Nikolayev familiar words. He understood that the fight with the major vendors head-on is pointless. The only chance — to find a narrow niche.
Producers every year makes the phone more and more complex, adding megapixels camera and megabytes processor. "I look at the market and want to cry. Everyone tries to make the iPhone, but cheaper. As a result, on the shelves of hundreds of" nedoayfonov "", — says Mikhail Nikolayev. He's a real fan of Apple, convinced that the best smartphone — it's the iPhone, and the best laptop — Mac. But once the beat of Steve Jobs is not possible, you need to look your way.
According to calculations by Mikhail Nikolayev, about 5% of subscribers of cellular networks in Russia — elderly people. They need a very simple model. So the idea of phone Just5. Nikolaev bet on five characteristics of the device: large buttons, simple menus, button SOS (by pressing it sends SMS phone and starts to dial in on a pre-selected telephone numbers), a loud sound and a battery, which lasts for a week. Among the additional features — only the radio and flashlight. IT journalists sarcastically nicknamed model "babushkofon."
You can not say that the idea of a 100% original. Phones for seniors produce Austrian company Emporia and the Swedish Doro. That is why Mikhail Nikolayev considers Europe as a key market. On the other hand, Emporia and Doro do not import their phones in Russia.
On the creation of the first model Just5 CP09 took over a year and a $ 2.5 million design and key features invented in Just5. Chinese company was engaged in the production Newplan Enterprises, which owns a large d
esign office and modern factory of consumer electronics in Shenzhen. The larger the party, the lower the cost of production, so Nikolaev Newplan allowed to sell his company developed the model in the Asian markets. For himself, he left Russia, Europe and the United States.
Nicholas began to sell the phone in a European — along with the contract operator. In autumn 2009, he agreed with the "megaphone". "At the time, no one else is offering such devices. We realized that the product has good prospects, and began selling it under its own brand," — says the head of the sales department and the service of "Megaphone" Igor Maystrenko. A total of "Megaphone" has already sold more than 50 million phones Just5. In the past year, with Just5 began to cooperate and "Beeline".
0.05%. This is the percentage of defects phones Just5, estimated the company itself. Do not have a network Just5 warranty workshops, so simply replace a broken cell phones to new
Two boxes. On one says "Megafon" and "social phone," on the other — Just5 and painted bright orange blot. Phones within the same — which replaced the SR09 last year model CP10. "You are what my mother would have given a box?" — Asks Mikhail Nikolayev. The choice is clear — a box with a brand Just5 looks much more spectacular. "Social" positioning phones "Megaphone" Nikolaev did not like. "Nobody ever buys his own mother" social phone "," babushkofon, "etc., — said the businessman. — People love their families and want to give stylish things."
Just5 phones under the brand first appeared in 2009 in PEI. Just two months into the network, they walked on iPhone sales and are now in the top 5 best selling phones. "Usually occurs so — describes Willie Hooks. — A man looks phones, compare prices, ask about the functions and suddenly notices Just5. Yet rational leaves. He says what a cool thing. How simple and beautiful." It turned out, Just5 buy not only and not so much for the elderly. "Here you come to the talks. Someone iPhone 4, other Vertu, iPhone 3 is not listed, and do you get Just5. Yet, you're out, you're different from all the" — explains the hook. According to his calculations, about 70% of the buyers Just5 — young people. He uses two phones — iPhone 4 and Just5.
"There's a large audience of people who use the phone only to make calls and send SMS. Normal vendors offer them flawed cheap phones that are no tears will not look. Nikolaev first brought to market a stylish and fashionable" dialer "," — said the head Portal Nomobile.ru Nicholas Turubara. According to feedback from online stores, a "dialer" appreciated not only hipsters, but skiers, bikers and lovers of ice fishing — room comfortable to type with gloves on.
Trendy gadget can not be cheap, reasoned Nikolaev. The average price of a cell phone in Russia in 2010 amounted to 4.5 million rubles. CP10 is worth 3.9 million rubles. However, the functional it is close to the cheapest models, the price of which — from 800-1000 rubles. Thus Just5 — the only vendor in Russia, which controls the prices of phones. His models are on display in all stores at the same price. An exception is made only for "Megaphone," which sells for CP10 2,5 thous., But under its own brand, in the less glamorous packaging and together with the contract — in other operators' networks model is not working. "Beeline" prefers to sell these phones under the brand Just5 and general market price. If the retailer starts to lower the price tag, Nikolaev ceases to cooperate with him. Just5 — too small a company to make a turn.
"Just5 — not a product indicator by which customers appreciate the high cost of the network. So it makes no sense to force down the price," — says Willie Hooks. The margin for retailers Just5 reaches 45%, whereas in models of major vendors — 8-10%. According to the estimates of industry analysts, the cost of CP10 together with shipping and customs fees of about 1 thousand rubles. apiece. That is, even giving 45% of the retail price on the shelf, Just5 is working with a margin of 100%.
Over the past year, Mikhail Nikolaev has built an extensive sales network in Russia. Just5 is sold in a "liaison", Media Markt, Metro Cash &Carry, "Republic" on Ozon.ru and other stores. Of the major mobile retailers are not able to agree only to "Euroset": the leader of the market wants to sell phones cheaper than all.
They told me you fool goner. motorola leaves the cell phone market, and you go
The American Dream
Mikhail Nikolayev knows how many phones will be able to implement this year. He has but one goal — to create an international brand. At the end of last year, he went for advice to Jack Trout. Marketing guru and president of Trout &Partners for 75 years, but he still advises some entrepreneurs, if that can not interest him. According to Eugene Kadushin, a representative of Trout &Partners in Russia, Nikolaev succeeded.
Trout liked the project, it is advised to promote the Just5 phone in the United States as "antismartfon" and invest in television advertising in the United States about $ 50 million of their money from Mikhail Nikolayev not. Certification to Federal Communication Commission and PTCRB, required to enter the U.S. market, has demanded that the Just5 $ 0,5 million the other hand, the Russian company was able to get into the portfolio of the largest U.S. electronics distributor D &H. In the U.S. model Just5 SR09 is one and a half times cheaper than in Russia — $ 67 (about 2 thousand rubles.). And if the Russian merchants attracted primarily high-margin sales Just5, then in the U.S. — non-standard goods. Special cell phones for the elderly in America was not. "There is no duty, no tickets. When buyers see an attractive commodity, they are just beginning to take it", — says Mikhail Nikolayev.
Last year Just5 received prestigious international awards in the field of industrial design iF and Red Dot, which aroused interest among American journalists. Reports about the amazing Russian removed channels USA Today, CBS News, C-net. Michael Spector batch of phones has presented AARP — American Association of Retired influential. The company expects to "word of mouth".
Chichvarkin believes that American expansion Just5 may well be successful, "Our business only hinder the brake head. U.S. market is open to new ideas."
However, good ideas are quickly copied. We had many imitators Just5. "It seems like now a boom on the phone with big buttons, and who just did not perform," — says Igor Maystrenko. For example, the British Fly and domestic Texet released to the Russian market model is very similar to CP10. Key model Texet decorated funny face — the company even copied this design element. Clones are sold in the shops, "El Dorado" and "M. Video" at the price of 1.5-2 thousand rubles., Though, according to Maystrenko, build quality and the materials they are still inferior CP10.
Sue Mikhail Nikolaev is not going to prove the fact of plagiarism is not so simple. Competitors have made some changes in the design. For example, the model can Fly insert two SIM-cards and it has a mp3-player.
Nikolaev wants to break away from the imitators, fast development of new models and investing in marketing. For example, the model CP10 Space, released in late 2010, painted in acid colors, so that my grandmother is no longer donate. In support of sales Just5 launched the first federal campaign on television. In the commercial for the company of young people is driving on the road under a colorful merry tune — the only one that can play CP10 Space. "This is not just a phone, but a fashion accessory," — says Mikhail Nikolayev. TNS Gallup has recorded in November — December 3679 output of this movie (it is estimated that such advertising could cost $ 1-2 million). At the most advertised model Samsung Monte S5620 for all of last year was 6432 outputs, the Nokia 2710 Navigation — 12,960.
Nikolaev loves simple solutions. The exhibition cell phones in Barcelona in February of this year, he designed a booth photo frame from IKEA. In them, he hung their phones with the flashlight, and the stand filled up a bunch of blobs — rubber toys in the shape of the logo of the brand. Toy has become the most fashionable souvenir from the show.
The fate of the entire project Just5 now depends on success in branding. If buyers will perceive phones Nikolayev as no name, then the chances are against cheap clones of him a little bit.