This is How Xiaomi Beat Samsung to Become the Top Smartphone Seller in China
Xiaomi, the four-year-old Chinese smartphone maker, has surpassed market-leader Samsung Electronics to become the leading smartphone vendor in China this year’s second quarter. According to a report published on Monday by the technology research company Canalys, Xiaomi delivered 15 million smartphones in China to take 14 percent market share. Whereas Samsung, which has been the top player in China for two straight years, shipped 13.2 million smartphones last quarter, down from 15.5 million in the same period a year ago, the report revealed.
Xiaomi was able to sell 4.4 million in the same period a year ago — which means the company grew 240 percent, compared with the last year’s second quarter. But how did a company, which is still relatively unknown in the United States, hold the largest market share in China and become the fifth-largest phone maker in the world?
Well, Chris Jones, an analyst for Canalys, thinks that the huge growth of Xiaomi in China is due to the different approach the company takes towards its branding, marketing and sales strategy.
While most Chinese handset makers compete on price, Xiaomi sells its feature-packed smartphones at just above cost price. It sells the phones for up to a year and a half until the price of components falls. To generate revenue, the phone maker focuses on selling apps, special Android themes and Internet services.
Xiaomi also offers a customized version of Android, called MIUI, which features additional functionality not found in stock Android, including a fully theme-able UI, gallery, camera apps, new music, and an alarm clock that rings even if the device is turned off. And to keep its customers excited, the company releases a new version of the OS every Friday.
When it comes to marketing, Xiaomi avoids to spend a ton of cash on crazy advertising, rather it deploys some cools and innovative strategies. The company runs festivals, engages with fans on the MIUI mobile phone forum – thus gaining over 1 million registered users, which it calls Mi fans.
However, Samsung Electronics and Apple are still by far dominating the global smartphone market. What Xiaomi needs to do now is to build its international brand if it is to retain its momentum. And it seems like the company is well-aware of this fact.
Last years, Xiaomi hired a top Google executive, Hugo Barra, to lead its international expansion plans. This has worked really well for the Chinese phone maker. Barra, who served as the vice president for Google’s Android division, used his industry skills to help Xiaomi expand their business globally. The company is now looking to expand into 10 new markets, including Mexico, Indonesia, Russia, Thailand, India and Turkey.
As the analyst Jessica Kwee said in a statement: “Xiaomi does have the potential to be a disruptive force beyond China and international vendors should take note.”
Via: The New York Times