(Yicai Global) Nov. 7 -- Metz Blue, a high-end television brand run by China's Skyworth Digital Holdings, has launched three artificial intelligence TVs in Hong Kong as it looks to send its products into multiple markets around the world.

Hong Kong is the brand's third stop after landing in India and Europe last month, Wang Zejun, general manager of overseas sales, told Yicai Global. He hopes Metz Blue will become a top-five manufacturer in the special administrative region's color TV market.

Skyworth designed Metz Blue to target young consumers, and its products are based on German brand Metz, which Skyworth purchased three years ago, the firm said in a statement prior to the Berlin electronics trade fair IFA in August. Skyworth will be the company's main brand for the global market, while Metz will focus on the German high-end market and Metz Blue will lean toward mid- and high-end markets in Europe, India and Hong Kong.

Metz Blue will have a more global supply chain than Metz, Wang said, with research centers in Shenzhen and Europe assuming joint responsibility for product and brand development. Metz Blue sets sold to German-speaking regions are made in Poland, while those sold in India are assembled locally with parts from China. TVs sold in Hong Kong are produced in Shenzhen, a mainland city not far from the SAR.

The firm aims to set up 10 distribution units worldwide and build up overseas sales to almost half of its global figure. International sales tallied eight million units in the fiscal year ended March 2018, up 15 percent on the year and making up 17.3 percent of the total.

The Road Ahead

Brand management, technology, quality and supply chains will be the biggest challenges on the rise to the top of the global market, Wang said. Skyworth has already started distributing TVs worldwide, but the brand is not yet well-recognized in overseas markets. Wang plans to ramp up investment and find distribution partners, and is already advertising on the side of Hong Kong buses.

The firm does not expect massive sales figures in Hong Kong as it is only a small market, he added, but the company listed in the stock market there in 2000 and it is representative of an international market. If Metz Blue can secure its standing in the local mid- to high-end market, it should help with expansion into foreign countries.

Skyworth is heading overseas as new competitors moving from the internet and smartphone sectors are saturating the Chinese mainland market, said Zhang Bin, research director at IHS Markit's China unit. Japanese and South Korean brands' shift to value management has also offered them opportunities in low- and mid-end segments, he added.

There are both opportunities and obstacles for Chinese TV makers looking to go international, he added. The breaks come from the domestic supply chain, as China has the world's largest liquid crystal display production base, but challenges arise from low brand awareness and distribution networks.

Chinese manufacturers cannot earn market recognition that quickly, so tend to expand overseas via original equipment manufacturing -- making TVs for better-known brands -- buying foreign counterparts or teaming up with them, Zhang said.

Skyworth has already begun developing a brand network through a series of international acquisitions. It bought Sinoprima Investments and Manufacturing in Africa in 2014, Metz and European video producer Strong Media in 2015, and purchased Toshiba's Indonesian factories and Southeast Asian businesses in 2016.

The shift in strategy to acquisitions over OEM will help improve Skyworth's branding and product value, Zhang added.

Editor: James Boynton