Another IPO in the cross-border circle, from a high-barrier track

In the cross-border field, more and more companies are heading for the capital market. In this trend, Xiange International, which is in the audio track, also took this key step at the end of last year.

According to data from Maximize Market Research, a market research and business consulting company in Chicago , the global audio equipment market will be worth US$36.01 billion in 2023, with total revenue expected to grow at a rate of 6.73% from 2024 to 2030, reaching nearly US$56.81 billion by 2030.

The audio market has high barriers to entry, and international brands from Europe, America and Japan occupy the vast majority of the market share. Currently, there are only a handful of Chinese brands that can get a share of this market. Xiange International has taken a different approach, choosing to acquire international brands and cleverly integrating resources from all parties to successfully create its own core competitiveness. At the same time, in recent years, some Chinese brands have also been unwilling to be outdone, focusing on segmented tracks, accurately positioning target customer groups, and standing out with differentiated products, making their mark in the international audio market.

The audio track is going to have an IPO

On December 9 last year , Xiange International Audiovisual Co., Ltd. (hereinafter referred to as "Xiange International") completed the guidance filing with the Shenzhen Securities Regulatory Bureau and planned to IPO on the Beijing Stock Exchange. The guidance institution was initially Dongxing Securities, and later changed to Zheshang Securities. In fact, more than a month ago (October 23), it had successfully landed on the New Third Board.

From a timeline perspective, Xiange International has a longer history than many sellers in the industry. As early as the 1990s , Xiange International was established, and it has a history of 34 years. Currently, the company is controlled by the two brothers Zhang Taiwu and Zhang Guangwu, who together control 93% of the company's shares.

The main products include home audio systems such as speakers, amplifiers, players, decoders, and professional audio systems such as professional speakers, mixers, microphones, stage computer lighting, etc. It owns internationally renowned audio brands such as Wharfedale, Luxman, Audiolab, QUAD, and Mission.

Different brands have differentiated brand positioning and product positioning, forming a complete brand matrix covering all types of consumer groups and covering high, medium and low-end markets. For example, the Wharfedale brand is mainly speaker products, positioned in the mid-range market and music lovers who pursue cost-effectiveness, while the Luxman and Audiolab brands are mainly electronic products such as amplifiers, positioned in the mid-to-high-end market.

Different from those brands that rely on their own strength to grow from bud to maturity step by step, Xiange International's brand was acquired through mergers and acquisitions. This approach has three advantages:

First, it can quickly break through market barriers and quickly gain a foothold in the market by leveraging the acquired brand’s existing mature sales channels and customer base, thus saving a lot of time and cost in developing new markets.

Second, it harvested valuable assets such as technical patents and supply chain resources accumulated by the brand over the years, injecting strong impetus into its own development and achieving a leap in technology and production capacity;

Third, achieve a diversified strategic layout, expand business boundaries by acquiring brands in different fields, enhance risk resistance, and occupy a more advantageous position in the fierce market competition.

It is reported that these brands of Xiange Co., Ltd. have decades of history in the United Kingdom, Japan and other countries. For example, Wharfedale, Luxman and QUAD were founded in 1932, 1925 and 1936 respectively. They have rich historical heritage and brand accumulation, and enjoy high brand awareness and reputation worldwide.

In the audio industry, especially in the field of home hi-fi audio, brand history, brand awareness and recognition have a significant impact on consumer purchasing behavior.

In terms of sales, Xiange International has established a sales network covering dozens of countries and regions around the world by relying on its first-mover advantage in channel construction and historical brand accumulation.

The public transfer statement shows that Xiange International's operating income in 2022 and 2023 will be 413 million yuan and 453 million yuan respectively, and its net profit will be 33.1667 million yuan and 53.7109 million yuan respectively. Export revenue accounts for a high proportion of operating income. In 2022 and 2023, export revenue accounted for 80.07% and 81.06% of operating income respectively. Overseas income mainly comes from Japan, the United Kingdom, the United States and Germany. The sales revenue of these four countries accounted for 36.81% and 37.90% of its operating income in each period respectively.

In terms of product types, speakers contribute the most to revenue, with sales of 183 million yuan in 2023, accounting for 40.52% of total revenue. Followed by amplifiers and players, with amplifiers contributing 147 million yuan in revenue and players contributing 59.11 million yuan in revenue in 2023.

According to a QYResearch report, the market for home high-fidelity audio systems for consumer electronics is growing rapidly as the global economy and income levels continue to rise. In 2022, the global home high-fidelity audio system market is expected to reach $2.982 billion, and it is expected to reach $4.588 billion in 2028, with a compound growth rate of 7.44% from 2022 to 2028.

It is worth mentioning that in the 2022 global home high-fidelity audio ranking, Xiangge International performed well, with a sales market share of 2.00%, ranking sixth in the world and first in China; sales revenue market share was 1.58%, ranking seventh in the world and second in China.

Brands are going global, showing off their talents

Thanks to a complete industrial chain, outstanding technical capabilities and cost advantages, China has become a major manufacturer of audio products in the world. According to Volza data, from March 2023 to February 2024, the top three exporters of professional speakers in the world are China ,   Mexico and   India. China ranked first in the world with 6,568 batches of professional speakers exported.

Today, the competition landscape of the global audio market has taken shape. Mature brands in Europe, America and Japan, such as Harman, Bose and Yamaha, have established strong competitive advantages and firmly occupied the mid-to-high-end market by relying on their long-term accumulated brand influence and huge user base.

Although China is a major audio manufacturer with a large number of manufacturers, most of them have not formed brand competitiveness and large-scale production capabilities. Over the years, only a few brands such as EDIFIER, Tonewinner, and HiVi have emerged in the fierce competition in the international market.

It is gratifying that in recent years, a number of emerging brands have taken a different approach, choosing to focus on segmented tracks, accurately positioning target customer groups, and gradually winning the favor of overseas consumers with their unique product advantages.

Although in the short term, these latecomer brands will find it difficult to shake the dominance of international brands in the entire audio market, in the niche areas, they have successfully overcome numerous obstacles, gradually gained a foothold, and begun to shape a unique brand image, opening up a new path for Chinese audio brands to go global.

Camping audio brand: MIFA

MIFA , a brand of Shenzhen Moko Innovation Technology Co., Ltd., was established in 2013 and officially started its overseas journey in 2015. At that time, the positioning of its products was still in the exploratory stage. In the fierce international market competition, it relied more on its keen perception of opportunities and the courage to move forward, and boldly plunged into it.

The key turning point in MIFA's development was the launch of its first product. This speaker has a unique design, a triangular shape, and a large area of ​​graffiti on the surface, which is full of "street style". After the product was launched on the market, MIFA found in user reviews that many buyers used it in outdoor scenes. MIFA quickly captured the strong demand of young people overseas for personalized and portable outdoor speakers, thus opening the road to development in the field of outdoor speakers.

Over the years, MIFA has continuously expanded the application scenarios of its products, from mountaineering, cycling, to rock climbing and hiking. Today, MIFA has focused its attention on the field of camping. In the Amazon store, MIFA is promoting a speaker with a built-in camping light for about US$170. It is expensive, but it is still loved by overseas consumers. A consumer from the United States commented: "This product attracted me immediately. To be honest, it is a bit expensive for me, but after opening it and using it, I think it is completely worth the price."

Because they are used outdoors, MIFA's products have excellent waterproof, dustproof and shockproof properties, and are not afraid of complex outdoor environments. On the other hand, MIFA has also put a lot of effort into design aesthetics. The product design is simple, but it reveals fine craftsmanship everywhere. The use of bold and strong colors cleverly integrates functionality and artistry. While meeting user needs, it can also bring visual aesthetic enjoyment.

For a long time, Moko Innovation has always kept a low profile. In fact, in the early years, it was a supplier to well-known "big manufacturers" such as Samsung and Huawei, and has accumulated certain strength and experience in the industry. In China, Moko Innovation also has an audio brand "See You There" for the middle-aged and elderly groups, and has a good development trend in this field.

With the joint efforts of domestic and foreign markets, Moco Innovation 's performance has grown significantly. By 2022, its revenue has successfully exceeded 400 million yuan .

Retro audio brand: MAO KING

MAO KING, or Elvis Presley Audio, is a brand launched by Chinese audio designer Zeng Dejun in 2015. With its retro design and unique sound quality, MAO KING has successfully entered the European, American, Japanese and Korean markets, becoming a representative of niche high-end brands.

Zeng Dejun is one of the earliest teachers and researchers of high-fidelity audio in China. His research results won the first prize of the National Science and Technology Progress Award in the 1980s. He is also an expert in audiophile-grade tube amplifier research, a Chinese high-end desktop radio designer, and a home audio expert. He has been deeply involved in the audio industry for more than 40 years. He has served as a design technician and management executive for many international and domestic first-line audio brands, and participated in or led the design of hundreds of audio products. All of these laid the foundation for the birth of MAO KING.

After the brand was established, Zeng Dejun quickly turned his attention to overseas markets. In 2017, MAO KING first participated in the first Radio Easter held in the Sahara Desert of Morocco, and then participated in the M&O Paris Fashion Home Design Exhibition held in France. Through these activities, MAO KING was able to stand out on the international stage and lay the foundation for further development of overseas markets.

In 2018, MAO KING launched a crowdfunding campaign on the US crowdfunding platform Indiegogo and achieved its crowdfunding goal with a 317% achievement rate , thus opening the way for the brand to go global. However, it does not seem to have continued to exert its strength on online platforms since then. As far as the current situation is concerned, although links to Mao Wang products can be retrieved on overseas mainstream e-commerce platforms such as Amazon, Lazada, and eBay, the number is very limited, and there are no stores.

Although MAO KING's layout on e-commerce platforms is not perfect and there are shortcomings in the expansion of online channels, the brand has gained high recognition in the design field with its outstanding product innovation capabilities and the ultimate experience it brings to users. It has won a series of well-known domestic and international awards, including the US CES Innovation Award and the German IF Product Design Award.

Waterproof speaker brand: Tribit

Many sellers may be unfamiliar with the brand Tribit, but if you mention Qianan Technology, most of you have probably heard of it. In fact, Tribit is a brand of Qianan Technology that focuses on audio products and was founded in 2017.

If there is any difference between Tribit's products and other audio brands, it must be its excellent waterproof function. Earlier, the professional technology platform techradar conducted a comprehensive evaluation of hundreds of speakers on the market, evaluating them from different dimensions, and finally selected 9 best waterproof speakers suitable for different scenarios. In this highly valuable list, two products of Tribit were successfully listed.

Although there is no exact data yet on Tribit's annual sales, its online sales have been impressive and its performance is outstanding.

On the Amazon platform, Tribit's core products have long been at the top of the best sellers list (BSR) in the audio sub-category. These products have user reviews of more than four stars and have an excellent reputation. Searching for the keyword "Tribit" shows that the order volume of each product link has performed well in the past 30 days. Among them, there are more than 5 links with order sales exceeding 500, and the sales of some links have exceeded 1,000 units.

The performance of the independent website is also outstanding. According to similarweb data, Tribit's website has more than 110,000 monthly visits, of which nearly 88% of the traffic comes from natural visits and direct searches, indicating that Tribit has won the trust of many overseas consumers and has formed a stable user base .

Currently, Tribit's sales footprint has spread across Europe, America and Southeast Asia, and considering the characteristics of the local Southeast Asian market, Tribit has also adopted a dual-channel model that combines offline distribution with online B2C .

Are Chinese audio brands going overseas and "overtaking on the curve" in these fields?

What is certain is that if Chinese audio brands want to stand out in the competition, they need to enter markets that international brands have not yet covered and break through with a differentiated strategy. So, as latecomers, what potential space can these brands seize? And what consumer demands can they tap into?

1. Opportunities in the field of environmental protection and sustainability

Nowadays, more and more consumers, especially the younger generation, tend to choose environmentally friendly and sustainable products. Surveys show that more than 60% of consumers are willing to pay a premium for environmentally friendly products. Therefore, Chinese brands going overseas can find innovative directions from this.

For example, bamboo, recycled plastics, bio-based materials, etc. can be used to replace traditional plastics and metals. In addition, recycled marine plastics or electronic waste can be used to make products to reduce resource waste. By launching a series of "carbon neutral certification" or "marine plastic recycling" products, consumers with strong environmental awareness can be attracted.

In addition to finding ways to improve materials, we can also make breakthroughs in technology, such as integrating solar charging functions into outdoor speakers to reduce dependence on traditional energy. We can also launch solar charging Bluetooth speakers suitable for outdoor camping and outdoor activities.

2. Expansion in application scenarios

Art creation scene

Dance and drama performances: Develop audio equipment with special sound processing functions for dance rehearsal rooms, drama stages, and other scenes. For example, it can simulate various environmental sound effects, such as wind, rain, and waves, to add more artistic appeal and expressiveness to dance and drama performances, help actors better enter the role, and improve the performance effect.

Elderly care scene

Elderly life companion: Audio products designed for the elderly can integrate rich elderly entertainment content, and have a simple and easy-to-use operation interface and voice interaction function. The elderly can easily play their favorite content through voice commands, enriching their later life and alleviating loneliness.

Health management assistant: Combined with the health management function, the speaker can regularly remind the elderly to undergo physical examinations, take medicines, etc. It can also play some audio content such as fitness exercises and health knowledge suitable for the elderly to help them maintain a healthy lifestyle.

Cultural tourism scene

Scenic spot guide: Cooperate with scenic spots to develop audio equipment with guide function. When tourists visit scenic spots, they can use the audio equipment they carry with them. When they arrive at a specific scenic spot, the audio equipment will automatically play the historical and cultural introduction, legends and other content of the scenic spot, providing tourists with a richer and deeper travel experience, while also reducing the work pressure of scenic spot tour guides.

3. Functional expansion creates new markets

Health monitoring function: Integrate health monitoring functions such as heart rate monitoring and sleep monitoring, and combine with music therapy to provide personalized music solutions based on the user's health data. For example, when the user's heart rate is detected to be too fast, soothing music will be automatically played to help the user relax; according to the user's sleep state, white noise or soft music that helps improve sleep quality will be played, making the audio product an auxiliary tool for healthy living.

Multimodal interaction function: In addition to traditional voice and button operations, develop multimodal interaction functions such as gesture recognition and facial recognition. Users can control the playback and volume adjustment of the audio system through gestures, or use facial expression recognition to judge the user's emotions and automatically switch to the appropriate music, thus improving the user's interactive experience with the audio product.

4. Potential brought by the integration of new technologies

Deep integration of artificial intelligence and audio: further enhance the audio's voice interaction capabilities, enabling it to more accurately understand and process natural language, and implement more complex operating instructions, such as automatically recommending appropriate music based on the user's mood, and realizing the linkage of smart home devices through voice control. Use artificial intelligence algorithms to optimize and personalize sound quality, automatically adjust audio parameters according to the hearing characteristics and music preferences of different users, and provide a unique sound quality experience.

Virtual reality ( VR) and augmented reality (AR) technology: Combined with VR and AR technology, an immersive music experience scene is created for users. For example, when enjoying a concert, VR technology allows users to feel as if they are at a real concert, feeling the stage atmosphere and interacting with the audience; in an AR scene, users can scan the surrounding environment through mobile phones or other devices, combining virtual music elements with real scenes to create a unique music interactive experience .

Xiange International