Xiao Mi’s Rise in the Tech Industry
Apple and Samsung are two of the household brands that pops in our minds when it comes to technology. Their success and growing market, however, didn’t stop startup companies to compete with the ever saturated and competitive market. More and more players have been trying their luck and efforts in providing quality products that are of different brands. One of which that took the tech industry by storm last 2014 was a brand named Xiaomi with its flagship phone (Mi4). It was founded by a Chinese entrepreneur, Lei Jun, in Beijing, China last 2010. It was funded by Chinese venture capitalists and a Singaporean based investment firm. Xiaomi is considered as one of the first few successful low-cost phone developers with having shipped a total of 61.1 million units in the year 2014.
Having been labeled as the “world’s most valuable startup”, the company admits that their growth went too fast than expected. CEO Lei Jun said in an interview, “There is a lot of innovation in China that I would think even the west hasn’t caught up with.” He wants to change the misconception on how Chinese companies just replicate ideas from the Western side and how products from China are of low manufactured quality. He believes that this could set a precedent on the perception of the world towards Chinese brands as Xiaomi doesn’t sacrifice costs for quality. There were some controversies being tagged along with the brand as the “Apple of China.” Lei Jun acknowledges how Steve Jobs has a great influence on his career. However, he believes that Xiaomi is more than just a smartphone company; instead, it creates tons of products that come together which then builds a lifestyle in this era of innovation. Uncommon to some, the company also creates games and helps other startups by investing in them and later selling the products on Xiaomi’s website.
What strategies did Xiaomi incorporate in order to attain such success? What makes them even different with other brands? One of which is selling their products close to cost. To compensate for that action, they put their products on the market for almost 18 months to sell as much. To attest to this, 2.1 million units of Xiaomi phones were sold online during a 12-hour period span last April 2015. In comparison with one of its rivals, Samsung stops their production upon releasing the product after 6 months. They are also very open in engaging with their users. The company places much emphasis on customer feedback and incorporating them into future decisions. Another strategy that is noticeable is that Xiaomi didn’t expand drastically by opening physical stores. Initially, they preferred selling their products online via Flipkart (an e-commerce firm) and their own website. This has reduced costs that may have been incurred otherwise.
Xiaomi understands the significance of expanding to international markets (other than their own) in order to achieve their goals. Their first successful launch outside of Asia was in Brazil held last 2014. In Asia, there is also a huge following of their brand from India. In the first quarter of 2017 alone, Xiaomi has shipped about 4 million units in India. Their main target market in India are young, internet-inclined individuals who prefer to buy online. In one of the recent studies, Xiaomi has reached an annual revenue of $1 billion in India. Although markets are high in India, this may not seem application for some Southeast Asian countries. One of which is Japan. There were some rumors that Xiaomi is planning to launch as a device in Japan priced as $50. However, this may be put to a hold as a news regarding the Rape of Nanking has made brought up once more in social media.
Tracing to a few years back, rivals and leading mobile companies may not have seen this coming. To what may appear to many as just a smartphone business, the company believes they’re an internet company which caters to several more products. Striking as the success of Xiaomi may be in the tech industry, this only proves how start-ups could change and innovate our future with technology.