A

RESEARCH PROJECT REPORT

on
COMPARATIVE ANALYSIS OF BUDGET SMARTPHONE IN INDIA

WITH REFERENCE TO
XIAOMI AND SAMSUNG

FOR THE PARTIAL FULFILLMENT OF THE REQUIREMENT FOR

THE AWARD OF
MASTER OF BUSINESS ADMINISTRATION

UNDER THE GUIDANCE OF:

MR.ROHIT VISHWAKARMA

SUBMITTED BY:
ADIL NAWAZ KHAN

ROLL NO – 1701170005
Batch 2017-2019

UNITED INSTITUTE OF MANAGEMENT

A-31, UPSIDC INDUSTRIAL AREA, NAINI, ALLAHABAD
(Affiliated to Dr APJ Abdul Kalam Technical University, Lucknow)

1
 UNITED INSTITUTE OF MANAGEMENT
A-31 UPSIDC Industrial Area, Naini, Allahabad – 211010

Ph. 0532–2686070. 2686090 Fax 0532-2687147

Certificate
Research Project Report – 2019

This is to certify that MR. ADIL NAWAZ KHAN Roll No(1701170005),student of

4thsemester,has completed his RESEARCH PROJRCT REPORT titled “COMPARATIVE

ANALYSIS OF BUDGET SMARTPHONE IN INIDA” .in partial fulfilment of MBA program

under the guidance of the undersigned..

The work is original and has not been submitted anywhere in any manner

Signature……………………………………

Name – …………………… ……………….

Project guide

Department of Business Administration

Date……………..….

Counter signed

Signature…………………

(Prof K K Malviya)

Principal

Date…………..……..……

2
 ACKNOWLEDGEMENT

As any good work is incomplete without acknowledging the people who made it possible,

this report is incomplete without thanking the people without whom this project would

not have taken shape.

I am extremely gratified to my mentor Mr. Rohit Vishwakarma sir who was

extremely helpful in offering his professional expertise and bestowing me practical

knowledge in all spheres related to the whole project done.I express me cordial

thanks to my Principal Prof. K.K Malviya and Mr. Vikas Mehrotra, for taking out time

from their busy schedule and providing me with relevant information ,which

contributed significantly in my project analysis and increased in totally new sphere.

ADIL NAWAZ KHAN

MBA 4TH SEMESTER

Roll no:1701170005

3
 PREFACE

This project titled “COMPARATIVE ANALYSIS OF BUDGET SMARTPHONE IN INDIA” is based

on research done by me and submitted to United Institute Of
Management”,Naini,Alahabad during the session 2018-19.This project gave me thorough
insight of practical world of smartphone market in India and it is beneficial for me as part
of exposure that I got while doing this research on one of the biggest growing market of
the world.

Adil Nawaz Khan

MBA 4th Semester

Roll No.
1701170005

4
 DECLARATION

I, Adil Nawaz Khan, hereby declare that the report for ““COMPARATIVE ANALYSIS OF

BUDGET SMARTPHONE IN INDIA” is a result of my own work and my indebtedness

to other work publications, references, if any, have been duly acknowledged.

ADIL NAWAZ KHAN

MBA 4TH SEMESTER

Roll no. 1701170005

5
 CONTENTS

Sr. No DESCRIPTION PAGE NO.

1. Acknowledgement 3

2. Preface 4

3. Declaration 5

4. Objective 8

5. Literature review 9-13

6 India’ mobile market 14-15

7. Executive summary(xiaomi) 16-34

Overview of the company (history, business
model, privacy concern, sales number,
temporary ban in India, hugo barra, products,
redmi,miui, development, smartphones of
Xiaomi )

9. SWOT analysis of xiaomi 35-39

6
10. Samsung (history, business strategy and 40-53
competitive advantage, SWOT analysis,
Samsung’smartphone )

11. Indian SmartPhone Market 54-59

12. Comparison of Xiomi & Samsung Smartphone 60-63

13. Research Methodology 64-65

14. Data Analysis 66-75

15. Finding 76

16. Recommendation 77

17. Conclusion 78

18. Bibliography 79

7
 Objective of the study

1.To analyze the Indian mobile market

2.To compare redmi and Samsung budget phones.

3.To analyse out the market share of different mobile companies in India.

8
 Literature review
Telecommunication

Britannica concise Encyclopedia explains

Telecommunication as “ transmission of signs, signals, messages, words, writings, images

and sounds or information of any nature by wire, radio, optical or

other electromagnetic systems.Telecommunication occurs when the exchange

of information between communication participants includes the use of technology. It is

transmitted either electrically over physical media, such as cables, or via electromagnetic

radiation. Such transmission paths are often divided into communication channels which

afford the advantages of multiplexing. Since the Latin term communicatio is considered the

social process of information exchange, the term telecommunicationsis often used in its

plural form because it involves many different technologies.

Early means of communicating over a distance included visual signals, such

as beacons, smoke signals, semaphore telegraphs, signal flags, and

optical heliographs. Other examples of pre-modern long-distance communication included

audio messages such as coded drumbeats, lung-blown horns, and loud whistles. 20th- and

21st-century technologies for long-distance communication usually involve electrical and

electromagnetic technologies, such as telegraph, telephone,

and teleprinter, networks, radio, microwave transmission, fiber optics,

and communications satellites.

9
A revolution in wireless communication began in the first decade of the 20th century with

the pioneering developments in radio communications by Guglielmo Marconi, who won

the Nobel Prize in Physics in 1909, and other notable pioneering inventors and developers

in the field of electrical and electronic telecommunications. These included Charles

Wheatstone and Samuel Morse (inventors of the telegraph), Alexander Graham

Bell (inventor of the telephone), Edwin Armstrong and Lee de Forest (inventors of radio),

as well as Vladimir K. Zworykin, John Logie Baird and Philo Farnsworth (some of the

inventors of television).

India's telecommunication network

It is the second largest in the world by number of telephone users (both fixed and mobile

phone) with 1.179 billion subscribers as on 31 July 2018. It has one of the lowest call tariffs

in the world enabled by mega telecom operators and hyper-competition among them. As

on 31 July 2018, India has the world's second-largest Internet user-base with 460.24

million broadband internet subscribers in the country. As of 31 December 2018, India had

a population of 130 crore people (1.3 billion), 123 crore (1.23 billion) Aadhaar digital

biometric identity cards, 121 crore (1.21 billion) mobile phones, 44.6 crore (4460 million)

smartphones, 56 crore (560 million or 43% of total population) internet users up from 481

million people (35% of the country's total population) in December 2017, and 51 per cent

growth in e-commerce.

Major sectors of the Indian telecommunication industry are telephone, internet and

television broadcast industry in the country which is in an ongoing process of transforming

into next generation network, employs an extensive system of modern network elements

10
such as digital telephone exchanges, mobile switching centres, media

gateways and signalling gateways at the core, interconnected by a wide variety of

transmission systems using fibre-optics or Microwave radio relay networks. The access

network, which connects the subscriber to the core, is highly diversified with different

copper-pair, optic-fibre and wireless technologies. DTH, a relatively new broadcasting

technology has attained significant popularity in the Television segment. The introduction

of private FM has given a fillip to the radio broadcasting in India. Telecommunication in

India has greatly been supported by the INSAT system of the country, one of the largest

domestic satellite systems in the world. India possesses a diversified communications

system, which links all parts of the country by telephone, Internet, radio, television and

satellite.

Indian telecom industry underwent a high pace of market liberalisation and growth since

the 1990s and now has become the world's most competitive and one of the fastest

growing telecom markets. The Industry has grown over twenty times in just ten years,

from under 37 million subscribers in the year 2001 to over 846 million subscribers in the

year 2011. India has the world's second-largestmobile phone user base with over 1157.04

million users as of July 2018.

Telecommunication has supported the socioeconomic development of India and has

played a significant role to narrow down the rural-urban digital divide to some extent. It

also has helped to increase the transparency of governance with the introduction of e-

governancein India. The government has pragmatically used modern telecommunication

facilities to deliver mass education programmes for the rural folk of India.

11
According to London-based telecom trade body GSMA, the telecom sector accounted for

6.5% of India's GDP in 2015, or about 9 lakh crore (US$130 billion), and supported direct

employment for 2.2 million people in the country. GSMA estimates that the Indian

telecom sector will contribute ₹14.5 lakh crore (US$200 billion) to the economy and

support 3 million direct jobs andA 2 million indirect jobs by 2020.

Telecommunications in India began with the introduction of the telegraph. The Indian

postal and telecom sectors are one of the worlds oldest. In 1850, the first experimental

electric telegraph line was started between Calcutta and  Diamond Harbour.

The demand for telephones was ever increasing and in the 1990s Indian government was

under increasing pressure to open up the telecom sector for private investment as a part

of Liberalisation-Privatisation-Globalisation policies that the government had to accept to

overcome the severe fiscal crisis and resultant balance of payments issue in 1991.

Consequently, private investment in the sector of Value Added Services (VAS) was allowed

and cellular telecom sector were opened up for competition from private investments. It

was during this period that the NarsimhaRao-led government introduced the National

Telecommunications policy (NTP) in 1994 which brought changes in the following areas:

ownership, service and regulation of telecommunications infrastructure. The policy

introduced the concept of telecommunication for alland its vision was to expand the

telecommunication facilities to all the villages in India. Liberalisation in the basic telecom

sector was also envisaged in this policy. They were also successful in establishing joint

ventures between state owned telecom companies and international players. Foreign

firms were eligible to 49% of the total stake.

12
During this period, the World Bank and ITU had advised the Indian Government to

liberalise long distance services to release the monopoly of the state owned DoT and VSNL

and to enable competition in the long distance carrier business which would help reduce

tariff's and better the economy of the country. The Rao run government instead liberalised

the local services, taking the opposite political parties into confidence and assuring foreign

involvement in the long distance business after 5 years. The country was divided into 20

telecommunication circles for basic telephony and 18 circles for mobile services. These

circles were divided into category A, B and C depending on the value of the revenue in

each circle. The government threw open the bids to one private company per circle along

with government owned DoT per circle.

For cellular service two service providers were allowed per circle and a 15 years licence

was given to each provider. During all these improvements, the government did face

oppositions from ITI, DoT, MTNL, VSNL and other labour unions, but they managed to keep

away away all hurdles

13
 India’s mobile market

According to the latest research from Counterpoint’s Market Monitor service, India’s

overall mobile phone shipments grew 48% YoY in Q1 2018. The market was driven by the

feature phone segment which doubled in Q1 2018 due to strong shipments of Reliance

JioPhone, while the smartphone market remained flat YoY.

Commenting on the findings, KarnChauhan, Research Analyst stated “Q1 2018 started off

with some brands sitting on inventory post the festive season in Q4 2017, which continued

throughout the quarter as industry moves to a full view display portfolio. Furthermore, the

quarter was also marked with less than normal smartphone launches as very few brands

refreshed their portfolio, except for Xiaomi and Samsung which benefitted from the new

launches. However, we expect the demand to start picking up from early Q2 2018

onwards, driven by faster replacement rate of existing 2G and 3G smartphone users

upgrading to 4G mobile phones.

Market summary

 The Indian mobile phone market grew by 48% YoY in Q1 2018 driven by strong

demand from the featurephone segment. The smartphone market remained flat YoY.

 The performance of Chinese brands remained strong, accounting for 57% of the

total smartphone market in Q1 2018, up from 53% during Q1 2017. This is the highest ever

contribution by Chinese players in the Indian smartphone market.

 In the smartphone segment, Xiaomi maintained its lead in Q1 2018 with a record

31% market share followed by Samsung (26%), vivo (6%), OPPO (6%), and Honor (3%).

14
 Huawei’s Honor brand captured the fifth position for the first time ever, in the

Indian smartphone market due to the strong performance of Honor 9 Lite and Honor 7X

across online channels.

 China based Transsion Group (the holding group of Tecno, Itel and Infinix) has

become the fifth largest player with 4% market share in Q1 2018 (combined for all three

brands). Tecno, which debuted in April last year, has emerged as a leading smartphone

brand and is close to entering the top ten list. The brand grew 23% QoQ in Q1 2018.

 In the featurephone segment, Reliance Jio now captures more than one-third of the total

featurephone market – the highest ever in a single quarter, since what Nokia achieved at its

peak.

 Itel, is the third largest player in the feature phone segment with 17% growth YoY in Q1

2018.

 Premium segment (>INR 30,000, US$ 452) remained flat YoY during Q1

2018. Samsung grabbed the top position in the premium segment, capturing half of the total

premium market due to new flagships – S9, S9 Plus and A8 Plus. OnePlus maintained the

second position with one-fourth share of the total premium smartphone market.

15
 Executive summary

Xiaomi

Xiaomi Corporation is a Chinese electronics company headquartered in Beijing. Xiaomi

makes and invests in  smartphones, mobile apps, laptops, and related consumer

electronics.

Xiaomi released its first smartphone in August 2011 and rapidly gained market share in

China to become the country's largest smartphone company in 2014. At the start of

second quarter of 2018, Xiaomi was the world's fourth-largest smartphone manufacturer,

leading in both the largest market, China, and the second-largest market, India. Xiaomi

later developed a wider range of consumer electronics, including a smart home (IoT)

device ecosystem.

Xiaomi has 15,000 employees in China, India, Malaysia, Singapore and is expanding to

other countries including Indonesia, the Philippines, and South Africa. According

to Forbes magazine, Lei Jun, the founder and CEO, has an estimated net worth of US$12.5

billion. He is China's 11th richest person and 118th in the world. Xiaomi is the world's 4th

most valuable technology start-up after receiving US$1.1 billion funding from investors,

making Xiaomi's valuation more than US$46 billion.

16
 History of the comoany

2010

On 6 April 2010 Xiaomi was co-founded by Lei Jun and six partners:

 Lin Bin, vice president of the Google China Institute of Engineering

 Dr Zhou Guangping, senior director of the Motorola Beijing R&D center

 Liu De, department head of industrial design at the Beijing Institute of Technology

 Li Wanqiang, general manager of Kingsoft Dictionary

 Wong Kong-Kat, principal development manager

 Hong Feng, senior product manager for Google China

In the first round of funding, institutional investors included Temasek Holdings, IDG

Capital, Qiming Venture Partners[ and Qualcomm.

On 16 August 2010, Xiaomi officially launched its first Android-based firmware MIUI. It

resembles Samsung's TouchWiz and Apple's iOS.

2011

The XiaomiMi 1 smartphone was announced in August 2011. It has

Xiaomi's MIUI firmware. The device could also be installed with stock Android.

2012

In August 2012 Xiaomi announced the XiaomiMi 2 smartphone.

2013

On 24 September 2013 Xiaomi sold over 10 million Mi 2 phones.

17
On 5 September 2013, Xiaomi CEO Lei Jun announced plans to launch an Android-based

47-inch 3D-capable Smart TV, which will be assembled by Sony TV manufacturer Wistron

Corporation of Taiwan. The company explained the choice as to take advantage of

Wistron's skill as a supplier of Sony.

In September 2013, Xiaomi announced its Mi 3 phone.

On 25 September 2013, Xiaomi announced plans to open its first service center in Beijing.

By October 2013 Xiaomi was the fifth-most-used smartphone brand in China.

In 2013 it sold 18.7 million smartphones.

2014

In 2014 Xiaomi announced its expansion outside China, with their first international

headquarters in Singapore. Future product launches and activities in the region will be set

up there.Following Singapore, the company opened in Malaysia, Philippines and India, and

plans to enter Indonesia, Thailand, Russia, Turkey, Brazil and Mexico in the following

months.

On 21 February 2014 Xiaomi's Redmi and Mi 3 phone were released in

Singapore. The XiaomiMi 3 batches were sold out within 2 minutes of the opening day sale

in Singapore.

In March 2014, Xiaomi Store Australia (an unrelated business) began selling Xiaomi mobile

phones online in Australia through its website, XiaomiStore.com.au.However, they traded

for only a few months, as Xiaomi soon "requested" that the store be shut down on (or by)

25 July 2014. Shortly after sales were halted, the website itself was also taken down, on 07

August 2014.An industry commentator described the action by Xiaomi to get the

18
Australian website closed down as unprecedented, saying, “I’ve never come across this

[before]. It would have to be a strategic move.”  At the time this left only one online

vendor selling Xiaomi mobile phones into Australia, namely Yatango (formerly MobiCity),

which was based in Hong Kong — although this business closed in late 2015 .

On 17 March 2014, Redmi Note phablet was announced by Xiaomi CEO Lei Jun.

In April 2014 Xiaomi purchased the Internet domain mi.com for a record US$3.6 million,

the most expensive domain name ever bought in China, replacing xiaomi.com as the

official Xiaomi domain.

In November 2014 Xiaomi said it would invest US$1 billion in television content building.

In December 2014 Xiaomi completed a round of equity financing led by Hong Kong-based

technology fund All-Stars Investment Limited, a fund run by former Morgan

Stanley analyst Richard Ji raising over US$1 billion, with a valuation of more than US$45

billion making it one of the most valuable private technology companies in the world.

The company sold over 60 million smartphones in 2014.

2015

In April 2015 Xiaomi announced it would make its Mi devices available through two of

India's major e-commerce sites and through offline retailers for the first time.

On 23 April 2015, Xiaomi CEO Lei Jun and VP Hugo Barra came together to announce a

new smartphone named Mi 4i in India, the first phone to be launched in India before any

other country. The XiaomiMi Band was also launched in the same event.

On 27 April 2015, it was reported Ratan Tata had acquired a stake in Xiaomi.

19
On 30 June 2015, Xiaomi announced its expansion into Brazil with the launch of locally

manufactured Redmi 2; it is the first time the company assembled a smartphone outside

of China.

2016

On 24 February 2016, Xiaomi launched the Mi 5 smartphone.

On 9 March 2016, Xiaomi launched its Redmi Note 3 in India. It was a groundbreaking

smartphone at the time in the budget segment, and was well received by Indian

customers. It made record sales on the year, and Xiaomi brand name continued to grow.

On 10 May 2016, Xiaomi launched the Mi Max.

Shortly after starting operations in Brazil the company left the country in the second half

of 2016.

In July 2016 Chinese artists as Liu Shishi, Wu Xiubo and Liu Haoran became the first

ambassadors of Xiaomi's Redmi series in China.

In August 2016 Xiaomi entered Bangladesh via Solar Electro Bangladesh Limited.

In September 2016 Xiaomi's cell phones became officially available in the European Union

through their partnership with ABC Data.

2017

On 20 February, Xiaomi officially launched in Pakistan and brought its Mi and RedMi Note

lineup to the country.

On 19 April, Xiaomi launched Mi 6, its flagship phone at the time.

20
In May, Xiaomi opened two MI Home stores; one in Bangalore (India) and one in

Bangladesh. It is the first of several planned for the region.

On 25 May, Xiaomi released Mi Max 2.

On 26 August, new MIUI v9 alongside Mi 5x has been released.

On 31 August, Xiaomi opened its first flagship Mi Store in Faisalabad, Pakistan.

On 5 September Xiaomi released Mi A1, which is the first Android One smartphone under

the slogan: Created by Xiaomi, Powered by Google. In the event key note Xiaomi stated

they started working with Google for the Mi A1 Android One smartphone almost six

months ago. An alternate version of the phone is also available with MIUI and is known as

MI 5X.

In September Xiaomi released Mi MIX 2

In October, the EU's first Mi Store has been opened in Athens, Greece.

On 7 November, Xiaomi started operating in Spain, making available the Mi A1 and Mi Mix

2 smartphones.

In Q3 2017, Xiaomi overtook Samsung to become the number one smartphone brand in

India. Xiaomi has sold 9.2 million units during this period.

2018

On 20 February, Xiaomi opened their first Mi Store in the Philippines.

In March 2018, at China's annual legislative session in Beijing, Xiaomi CEO Lei Jun

announced that Xiaomi has "always been considering entering the US market" and will

launch in the US smartphone market by late 2018 or early 2019. Xiaomi already sells

assorted items in the US such as power banks and Bluetooth speakers.

21
On 3 April 2018, Xiaomi launched the Mix 2S model which is a successor of Mix 2.

On 25 April 2018, Xiaomi launched the Mi 6X, a successor of Mi 5X.

On 22 May 2018, Xiaomi will open, in Paris, its first French store.

On May 3, 2018, Xiaomi filled to go public on the Hong Kong Stock Exchange and aims to

raise $10 billion in IPO which is expected to be the world’s biggest IPO raise since 2014.

On May 3. 2018, Xiaomi announced in partnership with 3 (telecommunications) to sell

smartphones in the United Kingdom, Ireland, Austria, Denmark, and Sweden

In May 2018, Xiaomi began selling some of their smart home products in the United States

through Amazon.

Business model

Lei Jun, Xiaomi's CEO, said that the company prices the phone almost at bill-of-

material prices, without compromising the component quality and performance compared

to other premium smartphones. It also profits by selling phone-related peripheral devices,

smart home products, apps, online videos and themes. According to Xiaomi's Hugo Barra

in 2014, the company sees hardware sales as a means of delivering software and services

in the long term, "We are an Internet and a software company much more than a

hardware company. However, financial data available at the time indicated that this is

either wishful thinking or plans for the far future: 94% of the company's revenue came

from mobile phone sales, an even higher proportion than Apple.

At first, to reduce overhead costs, Xiaomi did not own any physical stores, selling

exclusively from its online store. In recent years, they have opened 54 brick and mortar

stores to combat the strategies of other low-cost competitors in Chinese markets. It also

22
did away with traditional advertising and relies on social networking services and word-of-

mouth to publicise its products.

By keeping a tight control over its stock, Xiaomi is able to place cheaper batch orders as

demand dictates. Limited availability flash sales ensure that supply never outstrips

demand and helps promote its products. In contrast, traditional OEMs incur large upfront

productions costs, which must be recouped by selling prices, in order to ship phones, some

of which may not sell, out to retailers all around the world.

Xiaomi say that they listen closely to customer feedback, having them test out upcoming

features themselves, and building an extensive online community. ] Lei Jun described it this

way, "When I was with Kingsoft, I had the opportunity to work with Nokia and Motorola,

two mobile phone giants of their time. One day, I pointed out to their R&D boss, some

inadequacies. After that, they merely acknowledged my input, but never acted upon what

I had said. So I thought to myself, if I make a phone, you can tell me anything you wish for

it or what's wrong. If it is justifiable, we will work on it immediately. I'll give you an update

every week and you may even see your wishes come true within a week. In practice,

Xiaomi's product managers spend a lot of time browsing through the company's user

forums. Once a suggestion is picked up, it is quickly transferred to the engineers.

Therefore, features can turn from mere concept to shipping products within a week. The

company then ships a new batch of phones out every week on Tuesday at noon Beijing

time, containing the new software builds and possible minor hardware tweaks. Xiaomi

calls this process "design as you build."

According to the patent landscape report published in December 2016 by a patent

research and analytics firm GreyB Services, Xiaomi owns 6989 patents with more than 90%

23
of patents filed/acquired after 2012. The surge in number of patents was due to aggressive

patent acquisition/licensing deals with many companies including Broadcom, Intel,

and Microsoft. The patent acquisition was a strategic move by Xiaomi to strengthen its

weak patent portfolio aligned with its global expansion plan to create a defence against

patent lawsuits.

Xiaomi's mascot is a white rabbit wearing an Ushanka (known locally as a "Lei Feng hat" in

China) with a red star and a red scarf around its neck.

Privacy concerns

Xiaomi's cloud storage service Mi Cloud stores all the user data in its servers located in

China. There were also reports that Xiaomi's Cloud messaging service sends some private

data like call logs and contact information to Xiaomi servers. Xiaomi later released a MIUI

update that made cloud messaging optional, no private data is sent to Xiaomi servers if the

cloud messaging service is turned off, as Xiaomi claimed.

In October 2014, Xiaomi announced that they are setting up servers outside of China for

international users citing improved services and compliance to regulations in several

nations. Around the same time, the Indian Air Force issued a warning against Xiaomi

phones, stating that they were a national threat as they sent user data to an agency of the

Chinese government.

In September 2016, ThijsBroenink, a computer science student, suspected a pre-installed

app named AnalyticsCore in Xiaomi phones. Upon further investigation ThijsBroenink

reported, through a blog post,] that AnalyticsCore can send device information, including

IMEI, MAC address, Model, and other parameters, to Xiaomi servers. He also revealed

24
Xiaomi phones having a backdoor allowing installation of any app without user approval.

The veracity of his claims has yet to be verified.

Sales numbers

The Taiwanese Fair Trade Commission had investigated the flash sales and found that

Xiaomi had sold fewer smartphones than advertised. In December, 3 separate flash sales

were investigated. In those flash sales Xiaomi claimed that the number of smartphone sold

was 10,000 units each for the first two sales, and 8,000 units for the third one. However,

FTC had investigated the claims and found out that Xiaomionly sold 9,339 devices in the

first flash sale, 9,492 units in the second one, and 7,389 for the third. It was found that

during the first flash sale, Xiaomi had given 1,750 priority ‘F-codes’ to people who could

place their orders without having to go through the flash sale, thus diminishing the stock

that was publicly available. The FTC fined Xiaomi NT$600,000.

Temporary ban in India

On 9 December 2014, the High Court of Delhi granted an ex parte injunction that banned

the import and sale of Xiaomi products in India. This injunction was issued in response to a

complaint filed by Ericsson in connection with the infringement of its patent licensed

under FRAND (Fair, Reasonable and Non Discriminatory Licensing).[120] This injunction

issued by the High Court was applicable until February 2015, the date on which the High

Court was scheduled to summon both parties for a formal hearing of the case. On 16

December The Delhi High Court granted permission to Xiaomi to sell its devices that are

running on a Qualcomm-based processor until 8 January 2015. [121] Following this, Xiaomi

held various sales on Flipkart including on 30 December 2014. With this sale, the company

received press coverage when their flagship XiaomiRedmi Note 4G phone sold out in 6

25
seconds.[122]The judge extended the division bench's interim order allowing Xiaomi to

continue the sale of Qualcomm chipset-based handsets until March 2018.

Hugo Barra
In August 2013, the company announced that it was hiring Hugo Barra from Google, where

he served as vice president of product management for the Androidplatform. Barra has

declined to comment on the timing of the Google relationships, and stated that he had

been in talks with Xiaomi for over a year prior to announcing the move. He will be

employed as vice president of Xiaomi to expand the company outside of mainland China,

making Xiaomi the first company selling smartphones to poach a senior staffer from

Google's Android team. 

Products

Xiaomi produces many products. Notably, it produces smartphones which run on their

own version of Android MIUI firmware. Observers suggest that part of Xiaomi's rapid

success rests on its ability to differentiate itself within the Android universe. The company

has increased its range of products; its smartphones include: Mi Series, Mi Note Series, Mi

Max Series, Mi Mix Series and the Redmi Series. As well as mobile phones, Xiaomi has

started selling wearables, mobile accessories, and appliances such as television and

speakers. In 2018 it was selling tablets, laptops, and smart-home devices.

Xiaomi operates on a vertically-integrated model that enables the company to sell

hardware at cost or below in order to attract users and earn money by selling content.

Hugo Barra, a former Google executive who served Xiaomi's vice president from 2014 to

2017, characterized the organization as "an Internet and a software company much more

than a hardware company".

26
Xiaomi also keeps its prices low or close to "bill-of-material" by keeping most of its

products in the market longer, eighteen months rather than the six-month norm followed

by many smartphone companies. This strategy allows Xiaomi to take advantage of price

reductions in the prices of key components of its products. It enables the company to sell

hardware with specifications comparable to high-end devices at a fraction of the cost.

The company's version of the Android operating system, the MIUI skin, with its design, app

marketplace, and functionalities, has established a community of userswho form a crucial

part of Xiaomi's customer base and contribute to the company's drive for market

awareness. This ecosystem is a massive source of revenue as indicated in 2015, when sales

from the platform reached $750 million.

Recently Xiaomi started to sell more simple goods such as sunglasses, caps, pillows, glass

lunchboxes, cups, filters, bags, backpacks, luggages, screwdrivers, umbrellas and etc.

Redmi

Redmi is a sub-brand owned by the Chinese electronics company Xiaomi. It was introduced

as a budget smartphone line manufactured by Xiaomi, that was first announced in July

2013.[1] It became a sub-brand, separated from Xiaomi, on January 10, 2019. Redmi phones

use the Xiaomi MIUI user interface on top of Android. Models can be divided into regular

Redmi phones with screens usually up to 5" and Redmi Note series with displays exceeding

5". Only phone besides these two series is Redmi Pro, first introduced in 2016 with Dual

Camera system, USB-C and unique for Xiaomi devices OLED display. Redmi A have been

marketed in several Asian and European countries.The most significant difference from

other Xiaomi smartphones is that it uses less-expensive components and thus is more

27
cost-effective. In August 2014, The Wall Street Journal reported that in the second quarter

of the 2014 fiscal year Xiaomi smartphone shipment rankings in China with a market share

of 14%.[2] Redmi sales were attributed as a contributing factor toward this gain in shipment

rankings.

MIUI

MIUI (abbreviation of MI User Interface and pronounced as "Me You I")is a stock and

aftermarket firmware for smartphones and tablet computers developed by Xiaomi.The

firmware is based on Google's Android operating system. MIUI includes various features

such as theming support.

Xiaomi has released various smartphones, all but Mi A1, Mi A2 and Mi A2 lite of which

come pre-installed with a complete version of MIUI. Xiaomi devices usually get 1 android

version update, but keep getting MIUI updates for 4 years. The Redmi Note 3 runs MIUI

10. This has made various apps and features not available in the aftermarket version of

MIUI, but available only through rooting.

Other than supporting their in-house smartphones and tablets, Xiaomi also offers MIUI to

be flashed on other smartphone brands such

as Samsung, Sony, HTC, BLU, OnePlus, Nexus and Pixel.

On February 24, 2016, Xiaomi said that the MIUI ROM had over 160 million users

worldwide, and was supported on over 677 handsets.

28
 Smartphone of Xiaomi

XIAOMI REDMI NOTE 6 PRO

XiaomiRedmi Note 6 Pro was launched in November 2018 & runs on Android 8.1

OS. The Smartphone is available in more than three color options i.e.Black, Blue,

Rose Gold, Red & has a built in fingerprint sensor as the primary security feature,

along with the host of connectivity options in terms of 3G, 4G, GPS, Wifi Bluetooth

capabilities. Priced at Rs. 12999 the phone is available with 64 GB of internal

storage.

29
XIAOMI REDMI Y2 64GB

XiaomiRedmi Y2 64GBhas launched the Redmi Y2 selfie-smartphone in India. The phone

has a 5.99-inches display with HD+ resolution and 1440 x 720 pixels resolution at 269 ppi.

It has an 18:9 aspect ratio and a rear fingerprint scanner for added security. Under the

hood, it has a Qualcomm Snapdragon 625 processor for fast processing with 4GB of RAM

and 64GB internal storage expandable up to 128 GB via a microSD card slot. The device has

a metallic finish on the back.  The phone has a vertical dual 12MP+5MP rear camera and a

front 16MP selfie camera which is powered by ‘Artificial Intelligence’ that can click

amazing pictures.

30
XiaomiMi A1

XiaomiMi A1 was launched in September 2017 & runs on Android 7.1.2 OS. The

Smartphone is available in more than three color options i.e.Black, Gold, Rose Gold, Red &

has a built in fingerprint sensor as the primary security feature, along with the host of

connectivity options in terms of 3G, 4G, Wifi Bluetooth capabilities. Priced at Rs. 12999 the

phone is available with 64 GB of internal storage.

31
XIAOMI MI MAX 2

XiaomiMi Max 2 was launched in July 2017 & runs on Android 7.1 OS. The Smartphone is
available only in one color i.e. Gold & has a built in fingerprint sensor as the primary
security feature, along with the host of connectivity options in terms of 3G, 4G, GPS, Wifi
Bluetooth capabilities. Priced at Rs. 12999 the phone is available with 32 GB of internal
storage.

The Smartphone is powered by 2 GHz Octa core Qualcomm Snapdragon 625 Processor. A 4
GB of RAM &Adreno 506 graphics processor ensures phone runs smoothly even the most
memory intensive applications & still shows no signs of lag. 32 GB of internal storage can
be expanded to 256 GB via a microSD card.

32
XiaomiRedmi Note 5 (3GB/32GB)

XiaomiRedmi Note 5 3GB/32GB was launched in February 2018 & runs on Android 7.1 OS.
The Smartphone is available in more than three color options i.e.Black, Gold, Rose Gold,
Blue & has a built in fingerprint sensor as the primary security feature, along with the host
of connectivity options in terms of 3G, 4G, GPS, Wifi Bluetooth capabilities. Priced at Rs.
9999 the phone is available with 32 GB of internal storage.

The Smartphone is powered by 2 GHz Octa core Qualcomm Snapdragon 625 Processor. A 3
GB of RAM &Adreno 506 graphics processor ensures phone runs smoothly even the most
memory intensive applications & still shows no signs of lag. 32 GB of internal storage can
be expanded to 128 GB via a microSD card.

33
XIAOMI REDMI 6

Redmi 6 runs MIUI 9 on top of Android 8.1 Oreo out-of-the-box, and sports a 5.45-inch

HD+ (720x1440 pixels) display with an 18:9 aspect ratio and a 80.7 percent screen-to-body

ratio. As for internals, the budget smartphone is powered by an octa-core 12nm

MediaTekHelio P22 SoC (clocked at 2GHz), paired with 3GB/ 4GB of RAM.

XiaomiRedmi 6 was launched in September 2018 & runs on Android 8.1 OS. The

Smartphone is available in more than three color options i.e.Grey, Blue, Gold, Rose Gold

34
SWOT ANALYSIS OF XIAOMI

China is without a doubt one of the strongest manufacturers in the world. This is

due to cheap labour and due to the technology built over time. Xiaomi is a company

from Beijing in China which manufactures Smartphones. Its Mi and Redmi range of

smartphones are famous and well adapted to the market. Here is

the SWOT analysis of Xiaomi.

Strengths in the SWOT analysis of Xiaomi

One of the Largest Smartphone maker – Xiaomi is one of the largest smartphone

makers in the world. It is said to be the 5th largest smartphone manufacturer as of

2017. Originating from China, the Smartphones are manufactured in huge

quantities and have wide acceptance across the world.

Highest selling Smartphone – The REDMI Note 4 became the highest selling

smartphone in India and China and practically in 50% of the Asian market. This

shows that Xiaomi is strongly rising in the smartphone market and has already

beaten several giants.

Huge China and Asia market available – Another benefit to Xiaomi is that the

whole Asian market is their playground.

Penetrative Pricing – Xiaomi has the strongest penetrative pricing advantage

because it generally uses direct marketing techniques and avoids dealer and

distributor margins.

35
Good Quality products – Even at such low prices, no one can doubt the quality of

Xiaomi phones. The smartphones are regularly rated high on all E-

commerce portals – a further proof that Xiaomi does not compromise on quality

even if lowers the price regularly.

Manufacturing Advantage – China has a huge manufacturing advantage because

the country in itself is known for manufacturing and exporting the products. China is

also one of the largest consumers in the Asian market.

Rising Brand Awareness – Xiaomi’s brand awareness is rising and more and

more people are getting to know about the brand thereby resulting in higher sales

across the globe.

Growing year on year – The company which started manufacturing in 2011 has

grown by leaps and bounds and is regularly growing year on year.

E-commerce advantage – The Flash sale model is a very popular model which

has worked wonders for Xiaomi. In this model, the product is made available only in

limited quantities and sold at a very low price. This model made the consumers

crazy and each Xiaomi looked like a price which was hard earned.

Specifications of the smartphones produced – Xiaomi smartphones are

technologically advanced as well and they give higher tech specs at lower price.

Xiaomi phones are especially renowned for their camera which is said to be very

high resolution and gives excellent photos.

36
Research and Development – Xiaomi invests heavily in R&D and it is a market

followerbut its major R&D expenses are towards cost advantage and

not differentiationadvantage.

Weaknesses in the SWOT analysis of Xiaomi

Offline Distribution – Xiaomi mainly sold through the flash sale but at times, it

was difficult for customers to get their hands on a REDMI or MI model phone. This

is because their offline distribution is not upto mark and Xiaomi phones sell mainly

via E-commerce.

Advertising and Marketing spends – The advertising and marketing spends of

the brand is very low. The brand launches ATL campaigns only when coming up

with a new product. However, the advertising is erratic at best and is never

consistent.

Brand Image and Equity – Because the advertising and marketing efforts are

poor, the brand image is not so good as Samsung or Apple or other such

competitors. The product portfolio of Xiaomi is also limited which further effects the

brand image. Service centers too are limited and all these factors contribute to the

low brand equity and reputation.

Low Skimming price – While other smartphone manufacturers survive on

skimming price, Xiaomi launches its own phones at low prices in the flash sales. As

a result, it cannot take advantage of the skimming price or the advantage is not as

profitable as it would be for Samsung or Apple or other such high end brands.

37
Opportunities in the SWOT analysis of Xiaomi

Expansion – Covering the developing countries and the emerging markets should be

the priority for Xiaomi. As it mainly follows online sales model, which is becoming

popular in many countries, it should expand to countries where E-commerce mode

of purchase is well established or in the process of establishment.

Distribution – Besides online distribution, Xiaomi also needs to concentrate on

offline distribution if it ever wants to be consistent like some of its top competitors.

Offline distribution would also mean higher expenses and therefore a rise in price.

But it will help the brand to create a long term image and equity.

Brand Building – Brand building methods such as Sales promotions, Trade

promotions, ATL campaigns and BTL campaigns should be launched as regularly

as possible to build a better brand image. Xiaomi is far behind Oppo and Vivo

where BTL Campaigns are concerned.

Product Portfolio – Product portfolio of Xiaomi is limited and it has 2 major series

which actually contribute to the complete revenue of the brand. Expanding the

product portfolio will help the brand in brand building as well as in getting higher

revenues.

Penetration of Smartphones – Across the world, the smartphone as a product is

being adopted and people are using more and more smartphones with combination

of Internet. This market penetration of Smartphones is for the benefit of Xiaomi.

38
The better phones they manufacture, the more they will be able to capture market

share.

The dying need for expensive smartphones – People are tired of spending money

every year on a Samsung S8 or the latest Apple Iphone. People want cheaper

alternatives so that they can change their phone every alternate year. As a result,

most potential customers who have the potential to buy high end smartphones are

also buying chinese smartphones for their lower prices. This is why majorly all

rising

smartphone brands are from China – Xiaomi being one of them. This shift in

consumer preference is to the benefit of Xiaomi

Threats in the SWOT analysis of Xiaomi

Competition – Oppo and Vivo are 2 of the biggest competitor for Xiaomi because

they are themselves from China and have the same manufacturing advantages like

Xiaomi.

Service – The lack of service centers equivalent to the number of sales by the brand is a

worrying statistic. Xiaomi needs to increase its sales and service centers both if it wants to

retain its customers.

Samsung

39
Samsung  is a South Korean multinationalconglomerate headquartered in Samsung

Town, Seoul. It comprises numerous affiliated businesses, most of them united under

the Samsung brand, and is the largest South Korean chaebol (business conglomerate).

Samsung was founded by Lee Byung-chul in 1938 as a trading company. Over the next

three decades, the group diversified into areas including food processing, textiles,

insurance, securities, and retail. Samsung entered the electronics industry in the late

1960s and the construction and shipbuilding industries in the mid-1970s; these areas

would drive its subsequent growth. Following Lee's death in 1987, Samsung was separated

into four business groups – Samsung Group, Shinsegae Group, CJ Group and Hansol Group.

Since 1990, Samsung has increasingly globalised its activities and electronics; in particular,

its mobile phones and semiconductors have become its most important source of income.

As of 2017, Samsung has the 6th highest global brand value.

Notable Samsung industrial affiliates include Samsung Electronics (the world's

largest information technology company, consumer electronics

maker and chipmaker measured by 2017 revenues), Samsung Heavy Industries (the

world's 2nd largest shipbuilder measured by 2010 revenues), and Samsung

Engineering and Samsung C&T (respectively the world's 13th and 36th largest construction

companies). Other notable subsidiaries include Samsung Life Insurance (the world's 14th

largest life insurance company), Samsung Everland (operator of Everland Resort, the

oldest theme park in South Korea)and Cheil Worldwide (the world's 15th largest

advertising agency measured by 2012 revenues).

Samsung has a powerful influence on South Korea's economic development, politics,

media and culture and has been a major driving force behind the "Miracle on the Han

40
River". Its affiliate companies produce around a fifth of South Korea's total

exports.Samsung's revenue was equal to 17% of South Korea's $1,082 billion GDP.

Samsung started to rise as an international corporation in the 1990s. Samsung's

construction branch was awarded contracts to build one of the two Petronas Towers in

Malaysia, Taipei 101 in Taiwan and the BurjKhalifa in United Arab Emirates. In 1993, Lee

Kun-hee sold off ten of Samsung Group's subsidiaries, downsized the company, and

merged other operations to concentrate on three industries: electronics, engineering and

chemicals. In 1996, the Samsung Group reacquired the Sungkyunkwan

University foundation.

Samsung became the world's largest producer of memory chips in 1992 and is the world's

second-largest chipmaker after Intel (see Worldwide Top 20 Semiconductor Market Share

Ranking Year by Year). In 1995, it created its first liquid-crystal display screen. Ten years

later, Samsung grew to be the world's largest manufacturer of liquid-crystal display

panels. Sony, which had not invested in large-size TFT-LCDs, contacted Samsung to

cooperate, and, in 2006, S-LCD was established as a joint venture between Samsung and

Sony in order to provide a stable supply of LCD panels for both manufacturers. S-LCD was

owned by Samsung (50% plus one share) and Sony (50% minus one share) and operates its

factories and facilities in Tangjung, South Korea. As of 26 December 2011, it was

announced that Samsung had acquired the stake of Sony in this joint venture.

41
History
1938–1970

Lee Byung-chul, founder of Samsung

In 1938, Lee Byung-chul (1910–1987) of a large landowning family in the Uiryeong county

moved to nearby Daegu city and founded Samsung Sanghoe .Samsung started out as a

small trading company with forty employees located in Su-dong (now Ingyo-dong). It dealt

in dried-fish,[19] locally-grown groceries and noodles. The company prospered and Lee

moved its head office to Seoul in 1947. When the Korean War broke out, he was forced to

leave Seoul. He started a sugar refinery in Busan named Cheil Jedang. In 1954, Lee

founded Cheil Mojik and built the plant in Chimsan-dong, Daegu. It was the largest woollen

mill ever in the country.

Samsung diversified into many different areas. Lee sought to establish Samsung as leader

in a wide range of industries. Samsung moved into lines of business such as insurance,

securities and retail.

In 1947, Cho Hong-jai, the Hyosung group's founder, jointly invested in a new company

called Samsung Mulsan Gongsa, or the Samsung Trading Corporation, with the Samsung's

founder Lee Byung-chull. The trading firm grew to become the present-day Samsung C&T

42
Corporation. After a few years, Cho and Lee separated due to differences in management

style. Cho wanted a 30 equity share. Samsung Group was separated into Samsung Group

and Hyosung Group, Hankook Tire and other businesses.

In the late 1960s, Samsung Group entered the electronics industry. It formed several

electronics-related divisions, such as Samsung Electronics Devices, Samsung Electro-

Mechanics, Samsung Corning and Samsung Semiconductor & Telecommunications, and

made the facility in Suwon. Its first product was a black-and-white television set]

1970–1990

The SPC-1000, introduced in 1982, was Samsung's first personal computer (Korean market

only) and used an audio cassette tape to load and save data – the floppy drive was

optional.

In 1980, Samsung acquired the Gumi-based Hanguk Jeonja Tongsin and entered

telecommunications hardware. Its early products were switchboards. The facility was

developed into the telephone and fax manufacturing systems and became the center of

Samsung's mobile phone manufacturing. They have produced over 800 million mobile

phones to date. The company grouped them together under Samsung Electronics in the

1980s.

43
After Lee, the founder's death in 1987, Samsung Group was separated into four business

groups—Samsung Group, Shinsegae Group, CJ Groupand the Hansol Group. Shinsegae

(discount store, department store) was originally part of Samsung Group, separated in the

1990s from the Samsung Group along with CJ Group

(Food/Chemicals/Entertainment/logistics), and the Hansol Group (Paper/Telecom). Today

these separated groups are independent and they are not part of or connected to the

Samsung Group. One Hansol Group representative said, "Only people ignorant of the laws

governing the business world could believe something so absurd", adding, "When Hansol

separated from the Samsung Group in 1991, it severed all payment guarantees and share-

holding ties with Samsung affiliates." One Hansol Group source asserted, "Hansol,

Shinsegae, and CJ have been under independent management since their respective

separations from the Samsung Group". One Shinsegae department store executive

director said, "Shinsegae has no payment guarantees associated with the Samsung

Group".

In 1980s, Samsung Electronics began to invest heavily in research and development,

investments that were pivotal in pushing the company to the forefront of the global

electronics industry. In 1982, it built a television assembly plant in Portugal; in 1984, a

plant in New York; in 1985, a plant in Tokyo; in 1987, a facility in England; and another

facility in Austin, Texas, in 1996. As of 2012, Samsung has invested more

than US$13,000,000,000 in the Austin facility, which operates under the name Samsung

Austin Semiconductor. This makes the Austin location the largest foreign investment

in Texas and one of the largest single foreign investments in the United States.

44
1990–2000

Samsung started to rise as an international corporation in the 1990s. Samsung's

construction branch was awarded contracts to build one of the two Petronas Towers in

Malaysia, Taipei 101 in Taiwan and the Burj Khalifa in United Arab Emirates. In 1993, Lee

Kun-hee sold off ten of Samsung Group's subsidiaries, downsized the company, and

merged other operations to concentrate on three industries: electronics, engineering and

chemicals. In 1996, the Samsung Group reacquired the Sungkyunkwan

University foundation.

Samsung became the world's largest producer of memory chips in 1992 and is the world's

second-largest chipmaker after Intel (see Worldwide Top 20 Semiconductor Market Share

Ranking Year by Year). In 1995, it created its first liquid-crystal display screen. Ten years

later, Samsung grew to be the world's largest manufacturer of liquid-crystal display

panels. Sony, which had not invested in large-size TFT-LCDs, contacted Samsung to

cooperate, and, in 2006, S-LCD was established as a joint venture between Samsung and

Sony in order to provide a stable supply of LCD panels for both manufacturers. S-LCD was

owned by Samsung (50% plus one share) and Sony (50% minus one share) and operates its

factories and facilities in Tangjung, South Korea. As of 26 December 2011, it was

announced that Samsung had acquired the stake of Sony in this joint venture.

Compared to other major Korean companies, Samsung survived the 1997 Asian financial

crisis relatively unharmed. However, Samsung Motor was sold to Renault at a significant

loss. As of 2010, Renault Samsung is 80.1 percent owned by Renault and 19.9 percent

owned by Samsung. Additionally, Samsung manufactured a range of aircraft from the

1980s to 1990s. The company was founded in 1999 as Korea Aerospace Industries (KAI),

45
the result of a merger between then three domestic major aerospace divisions of Samsung

Aerospace, Daewoo Heavy Industries and Hyundai Space and Aircraft Company. However,

Samsung still manufactures aircraft engines and gas turbines.

2000–present

The prominent Samsung sign in Times Square, New York City

In 2010, Samsung announced a ten-year growth strategy centered around five

businesses. One of these businesses was to be focused on biopharmaceuticals, to which

has committed ₩2,100,000,000,000.

In first quarter of 2012, Samsung Electronics became the world's largest mobile phone

maker by unit sales, overtaking Nokia, which had been the market leader since 1998.

On 24 August 2012, nine American jurors ruled that Samsung Electronics had to

pay Apple $1.05 billion in damages for violating six of its patents

on smartphone technology. The award was still less than the $2.5 billion requested by

Apple. The decision also ruled that Apple did not violate five Samsung patents cited in the

case. Samsung decried the decision saying that the move could harm innovation in the

sector. It also followed a South Korean ruling stating that both companies were guilty of

infringing on each other's intellectual property. In first trading after the ruling, Samsung

shares on the Kospi index fell 7.7%, the largest fall since 24 October 2008, to

46
1,177,000 Korean won. Apple then sought to ban the sales of eight Samsung phones

(Galaxy S 4G, Galaxy S2 AT&T, Galaxy S2 Skyrocket, Galaxy S2 T-Mobile, Galaxy S2 Epic 4G,

Galaxy S Showcase, Droid Charge and Galaxy Prevail) in the United Stateswhich has been

denied by the court.

In 2015, Samsung has been granted more U.S. patents than any other company - including

IBM, Google, Sony, Microsoft and Apple. The company received 7,679 utility patents

through 11 December. On 2 August 2016, Samsung Electronics unveiled the Galaxy

Note7 smartphone, which went on sale on 19 August 2016. However, in early September

2016, Samsung suspended sales of the phone and announced an informal recall. This

occurred after some units of the phones had batteries with a defect that caused them to

produce excessive heat, leading to fires and explosions. Samsung replaced the recalled

units of the phones with a new version; however, it was later discovered that the new

version of the Galaxy Note 7 also had the battery defect. Samsung recalled all Galaxy

Note7 smartphones worldwide on 10 October 2016, and permanently ended production of

the phone the following day.

Samsung Business Strategy and Competitive Advantage

Samsung business strategy is marked with a high level of flexibility in a way that the

company is determined in changing its strategy dramatically according to changes in

external business environment. Few people know that the Samsung initially started as a

grocery store in Korea in 1938, switched to noodle business in 1940 and moved to sugar

production in 1950. Later, Samsung became engaged in woollen mill in 1954 and insurance

and securities business in 1956.

47
 Samsung produced black and white TV as the first technological product in 1960 and since

then the company emerged as one of the leaders in technology and electronics market

segments in the global scale. Frequent change of direction and new product development

persists as important features of Samsung business strategy to this day.

Samsung business strategy consists of the following three pillars/elements/parts:

 1. Effective market readership. A market reader can be defined as a company that closely

observes the market and is fast in replicating new products and/or introducing new

features in existing products, initially introduced by other companies. Specifically,

Samsung has proved effective in replicating the design and important features of

smartphones from its main competitor, Apple. It has been noted that “one internal

Samsung presentation from 2010 provided a step-by-step process for Samsung engineers

to follow in an effort to steal so much of what made the iPhone such a unique product”.

2. Scanning and utilising opportunities in the market. Samsung business strategy

integrates constant search for gaps in the market and exploits the opportunity with

positive implications on the bottom line for the business. For example, Samsung noticed

that Asian-language speakers in particular wanted a device that they could hand-write on,

because drawing characters is easier with a pen. The result was a development of series of

Samsung Note devices as a combination phone/tablet (“phablet”) that’s been an

unexpected hit.

3. New product development. Samsung Electronics has an extensive product range that

includes hundreds of product types and is arranged along three product divisions: IT &

Mobile Communications (IM), Consumer Electronics (CE), and Device Solutions (DS).

48
 Samsung SWOT Analysis

SWOT is an acronym for strengths, weaknesses, opportunities and threats related to

organizations. The following table illustrates Samsung SWOT analysis:

Strengths

1.      Leadership in visual display market segment

2.      Strong patent portfolio

3.      High brand value

4.      Global leadership across all mobile and smartphone markets

5.      Solid financial position of the company

Weaknesses

1.      Absence of own OS and software

2.      Damage to brand image due to product safety issues

3.      Low profit margin

4.      Extensive product portfolio

5.      Competitive advantage hard to sustain

Opportunities

1.      Further increasing investment in R&D

2.      Focusing on mobile advertisements

3.      Entering cloud business segment

49
4.      Increasing presence in emerging markets

5.      Entering into strategic collaboration with affiliated businesses

Threats

1.      Changes in currency exchange rate

2.      Intensification of competition due to the slowing growth in the industry

3.      Disruption in the pipeline of new products

Samsung smartphones

50
1.Samsung Galaxy On NXT

Samsung Galaxy On NXT was launched in November 2016 & runs on Android 6.0 OS. The

Smartphone is available in two color options i.e. Black, Gold & has a built in fingerprint

sensor as the primary security feature, along with the host of connectivity options in terms

of 3G, 4G, GPS, Wifi Bluetooth capabilities. Priced at Rs. 12460 the phone is available with

32 GB of internal storage.

2.Samsung Galaxy J7 Prime 32GB

51
Samsung Galaxy J7 Prime 32GB was launched in May 2017 & runs on Android 6.0.1 OS. The

Smartphone is available in two color options i.e. Black, Gold & has a built in fingerprint

sensor as the primary security feature, along with the host of connectivity options in terms

of 3G, 4G, GPS, Wifi, NFC Bluetooth capabilities. Priced at Rs. 14923 the phone is available

with 32 GB of internal storage.

52
3. Samsung Galaxy J7 Nxt

samsung has launched mid range smartphone Samsung Galaxy J7 Nxt, 5.5 inch HD display

powered by an octa-core, 1.6 GHz processor, 2GB RAM Priced at Rs 11,490/- with internal

memory of 16GB (expandable up to 256GB).

Samsung Galaxy J7 Nxt was launched in July 2017 & runs on Android 7.0 OS. The

Smartphone is available in two color options i.e. Black, Gold & provides a host of

connectivity options in terms of 3G, 4G, GPS, Wifi Bluetooth capabilities. Priced at Rs. 9990

the phone is available with 16 GB of internal storage.

53
 Indian smartphone market

According to the IDC India’s (International Data Corporation) Quarterly Mobile Phone

Tracker, smartphone companies shipped a total of 33.5 million units to India during the

second quarter of 2018 (2Q18), resulting in a healthy 20% year-over-year (YoY) growth.

IDC believes that this is the result of a slew of online exclusive launches and strong

shipments by offline heavy vendors on the back of high decibel promotional activities and

channel schemes

The market, however, is seeing rapid consolidation at the top end, as the top 5 vendors

made up 79% of the smartphone market in 2Q18, marginalizing smaller brands” says

Upasana Joshi, Associate Research Manager, Client Devices, IDC India

Xiaomi remains the leader in the smartphone market with growing offline presence while

maintaining dominance in the online space. Xiaomi contributed more than 56% of the

shipments in online space, while 33% of its shipments went through offline channels in

2Q18.

In the online segment, Huawei with strong shipments of its Honor branded phones,

climbed to the second position with an all-time high of 8% share in online segment in

2Q18. “Huawei has had a stellar quarter worldwide moving into the second position,

toppling Apple. In India, with a refreshed focus it has been able to grow its share in the

online space in the last two quarters, on the back of several new launches across price

segments. IDC believes Huawei should be seen as a serious long-term player in India

market with all the ingredients to challenge Xiaomi and Samsung” adds Joshi.

54
Other online-focused vendors with online exclusive launches were OnePlus with its new

launch OnePlus 6, Realme with Realme1 and Asus with Zenfone Max Pro series, all of

which led to an annual growth of 44% in the online channel shipments and taking the

online share to 36% of the smartphone market.

Offline segment growth was driven by vivo which had strong shipments during the quarter

on the back of high decibel marketing campaigns around new launches like V9 including

advertisement campaign featuring popular movie star Amir Khan, title sponsorship in

Indian Premier League cricket tournament and attractive booster schemes available for

channel partners.

SmartPhones in the Indian Market

It isn’t a hidden truth anymore that the smartphone market provides to be one of the

most substantial businesses at the moment. The competition is fierce among the big game

players to increase its customer base as well as have a strong hold within the market. India

is a major market for smartphones. India has inched past the US to become the second

largest smartphone market in terms of active unique smartphone user base in the world

with the base crossing 220 million users. This speaks volume for the scale India market

provides for any player in the mobile connected ecosystem. It is estimated that the value

of smartphones sold last year was anywhere between Rs. 75,000 crores to Rs. 80,000

crores. The growth in the smartphone market was helped by vendors using online retail or

“eTail” to penetrate the market. Listed below are some of the few major companies who

have been dominating the Indian market for some time now.

55
 Samsung Samsung wasn’t as popular as now. The South Korean based company struggled

to keep up with the smartphone market, but now they have progressed so much that they

are the main competitor of Apple Inc. Samsung’s market share in the smartphone’s

segment in India went up from 35.1 percent to 45.9 percent during 2015. It has an overall

market share of 44 percent across all segments. Samsung with 18 4G devices account for

62 percent market share. The company was focusing on 4G, which was growing rapidly

and consumers were migrating from 2G and 3G. The R&D team is based in Chennai,

Bengaluru and Noida. Samsung is manufacturing all mobile phones across all segments,

except Gear S2 and Gear VR, in India. “We strengthened our device portfolio across price

categories, which has resulted in a strong market share,” said Asim Warsi, vice president of

marketing for IT and mobiles at Samsung India. Samsung caters to its demographic. They

offer better features for a lesser price and this is exactly what goes with the Indian

market. HTC HTC compared to Micromax, Lava and Samsung are on the lower end of the

spectrum. But that doesn’t mean they are giving up on the competition in the Indian

market. According to market research firm GfK, HTC currently has less than 5% market

share in the mid-range smartphone segment, and almost 4% in the overall smartphones

category in India. HTC is ramping up its presence in the affordable category (Rs 8,000-

15,000) in the country with the introduction of new devices, including 4G-enabled, to gain

share in the heavily contested smartphone market in India.  By doing that HTC are

targeting a minimum of 8% gain in the above category within the next 6 months. “We will

broaden our price play horizons at both ends. India is an important market for us. If HTC

has to do good globally, India numbers have to be positive,” HTC President (Global Sales)

Chia-Lin Chang said. 

56
MicromaxMicromax is an Indian consumer electronics company headquartered in

Gurgaon, Haryana. The company was established as an IT software company operating in

the embedded devices domain; it later entered the mobile handset business. Micromax’s

claim to fame was its Canvas series, which offered an affordable alternative to the likes of

the high-end phones in the market. It has heavily invested in local manufacturing,

producing up to 2 million units a month in the country. Budget smartphone maker

Micromax had leapfrogged South Korea’s Samsung Electronics to become the leading

supplier in India’s booming smartphone market for the first time in the fourth quarter of

2014. Micromax is also the parent company of Yu Televentures, which has inked an

exclusive partnership with Cyanogen Inc. to deliver Cyanogen OS pre-installed on its

devices. 

Lenovo At the end of the final quarter last year the Lenovo group, comprising Lenovo and

Motorola brands, has overtaken Lava to climb to the fourth spot in the extremely

competitive smartphone market in India. While Samsung is the industry leader in volume

terms, Micromax is second and Intex third. The Lenovo-Moto combine has overtaken Lava

to grab the fourth position. In value terms, Lenovo is number three, ahead of Intex.

Samsung and Micromax again occupy the top-two spot. From value point of view, the

Lenovo group have 11% market share. One of the reasons why they have grown so

significantly is because of their dual brand strategy. Both cater to different kinds of

customers and in different platforms. While Lenovo sells offline and online, Moto is

exclusively online. In the online space, we are the number one company To meet their

rapidly growing service requirements, the company has begun opening Lenovo-Motorola

exclusive service centres. Till date, the company has opened 52 centres across 42 cities

57
and has targeted 100 by March 2016 across 75 cities that will cover 75% of the

smartphone market.Lava Lava International was established in the year 2003 as Pacetel

Communications. In 2009, the company was renamed Lava International. The company

launched the world’s first Intel chip-based smartphone. Lava is the first India phone

vendor to introduce its own user interface or skin —Hive— on the Android OS. No other

domestic brand has invested on this front lately. The new software is said to be a strong

product differentiator for Lava devices in India. Lava with a healthy 20 per cent year-on-

year growth continued to manage its place in the top five in highly cluttered Indian

smartphone market. Lava gained share in the online channel mainly through 4G based

shipments from their Xolo series. Lava can be a serious contender in the Indian market

over the years to come. They are steadily increasing their customer base and their

smartphones are not failing them.

 Future Emerging as a big force in the global smartphones market during 2015, India saw

about 75 million devices being shipped in the first three quarters of the year. The pace of

the blistering growth was further strengthened by the online channel as many handset

makers added e-commerce only devices. So it is safe to say that the future of the India

smartphone market is going to be as fierce as it can get. International brands do realize

how much business as well as revenue be generated if they ever decide to entice the

market with their products. Only time will tell in the next coming years whether the

competition is stable at the top or whether there will be a new entrant to challenge the

current situation in the market. 

58
Samsung Galaxy J2 (2018) vsXiaomiRedmi 5

59
Winner: Xiaomi Redmi 5 by a huge margin

The Xiaomi Redmi 5 has destroyed the Galaxy J2 (2018) in almost every department. The

phone with its latest 18:9 aspect on display, powerful processor, better camera and

battery backup makes the Galaxy J2 (2018) feels like an underachiever in all regards. So, if

you are planning to buy the Galaxy J2 (2018), we suggest you should skip as it does not

have the kind of specs that has become a standard affair in the budget segment.

Samsung Galaxy M20 vsXiaomiRedmi Note 6 Pro

60
Verdict

 Users who are out in the market looking for a new smartphone in budget ranging from Rs

10,000 to Rs 15,000 could get either of these smartphones. While the 6GB RAM variant of

the Redmi Note 6 Pro is for power users, there is just a difference of Rs 1,000 in the top

variant of the M20 and the base variant of the Note 6 Pro. If you're a sucker for

performance, less lags and smooth user experience, the Redmi Note 6 Pro is what you

should choose. On the contrary, if users are looking for something different than the usual

Xiaomi phones, Samsung Galaxy M20 makes for a worth competitor.

Samsung Galaxy M20 vsRedmi Note 7

61
Both Samsung Galaxy M20 and Redmi Note 7 are pretty good phones from Xiaomi and

Samsung each.Redmi Note 7 comes with solid performance, a good looking display, an

awesome camera, solid build and much more. While the newly launched Samsung Galaxy

M20 definitely would give the Note a solid fight.

To sum up, Samsung Galaxy M20 will definitely lack in the camera department. The 48MP

Samsung sensor on Redmi Note 7 surely offers an advantage over the Galaxy M20 dual

shooter. But, if we leave the cameras, Samsung Galaxy M20 is a solid buy at the price.

Samsung Galaxy J7 Prime vsXiaomiRedmi Note 4

Redmi note 4 is better.

62
XiaomiRedmi Note 4 smartphone was launched in August 2016. The phone comes with a

5.50-inch touchscreen display with a resolution of 1080 pixels by 1920 pixels at a PPI of

401 pixels per inch. XiaomiRedmi Note 4 price in India starts from Rs. 9,999.

The XiaomiRedmi Note 4 is powered by 2GHz octa-core Qualcomm Snapdragon 625

processor and it comes with 4GB of RAM. The phone packs 64GB of internal storage that

can be expanded up to 128GB via a microSD card. As far as the cameras are concerned, the

XiaomiRedmi Note 4 packs a 13-megapixel primary camera on the rear and a 5-megapixel

front shooter for selfies.

The XiaomiRedmi Note 4 runs Android 6.0 and is powered by a 4100mAh non removable

battery. It measures 151.00 x 76.00 x 8.30 (height x width x thickness) and weigh 175.00

grams.

Research methodology

Research design

Analytical research

Analytical research is a specific type of research that involves critical thinking skills and the

evaluation of facts and information relative to the research being conducted. A variety of

people including students, doctors and psychologists use analytical research during studies

to find the most relevant information. From analytical research, a person finds out critical

details to add new ideas to the material being produced.

63
Research of any type is a method to discover information. Within analytical research

articles, data and other important facts that pertain to a project is compiled; after the

information is collected and evaluated, the sources are used to prove a hypothesis or

support an idea. Using critical thinking skills (a method of thinking that involves identifying

a claim or assumption and deciding if it is true or false) a person is able to effectively pull

out small details to form greater assumptions about the material.

Sources of data

Secondary data

Secondary refers to data which is collected by someone who is someone other than the

user. Common sources of secondary data for social science include censuses, information

collected by government departments, organizational records and data that was originally

collected for other research purposes. Primary data, by contrast, are collected by the

investigator conducting the research.

Secondary data analysis can save time that would otherwise be spent collecting data and,

particularly in the case of quantitative data, can provide larger and higher-quality

databases that would be unfeasible for any individual researcher to collect on their own. In

addition, analysts of social and economic change consider secondary data essential, since

it is impossible to conduct a new survey that can adequately capture past change and/or

developments. However, secondary data analysis can be less useful in marketing research,

as data may be outdated or inaccurate.

Sources

1.NDTV gadget guru

64
2.Mobile Indian

3.journals

Limitation of the study

1.limited time available for project.

2.limited access to information.

3.lack of authenticity due to dependency on secondary source

Data analysis

1.India Smartphone Market Share: By Quarter

India
Smartphon
e 2017Q 2018Q 2018Q 2018Q 2018Q
Shipments 4 1 2 3 4
Market
Share (%)

Xiaomi 25% 31% 28% 27% 27%

Samsung 23% 26% 28% 22% 20%

vivo 6% 6% 12% 10% 10%

65
 Oppo 6% 6% 9% 8% 7%

Micromax 5% 3% 1% 9% 5%

Others 35% 28% 22% 24% 31%

From the above graph we can conclude that both the Samsung and xiaomi share was rising

till q1 of 2018 and falls slightly after the quarter to 20% and 27% repectively.

2.Most sold smartphone India

66
From the above graph we can conclude that xiaomiredmi 5A Is the most sold smartphone

in India followed by Samsung j2 pro

67
3.Smartphone preference

68
From the above graph we can conclude that xiaomi is the most proffered brand in India

with 9% share followed by Samsung apple Motorola Lenovo one plus and micromax

69
4.Smartphone growth in India

70
From the above graph we can conclude that India’smartphone growth has risen by 10%

which is dominated by china market.

5.Most popular smartphone

71
From the above graph we can conclude that Xiaomi 5a is the most popular smartphone

followed by xiaomiredmi note 5 pro,Samsung galaxy 76,xiaomi redmi note 5,vivo Y71.

Xiaomi Porter’s Five Forces Analysis

Porter’s Five Forces is an analytical framework developed by Michael Porter (1979). Xiaomi

Porter’s Five Forces consists of five individual forces that shape an overall extent of

competition in the industry. These forces are illustrated in Figure below:

72
Threat of New Entrants in Xiaomi Porter’s Five Forces Analysis

Threat of new entrants into the internet technology is low. There are entry barriers for

potentially new market players. Economies of scale is one of the major factors and entry

barrier for new companies. Xiaomi is able to offer its products for competitive prices

because it purchases raw materials in bulk and benefits from the economies of scale to a

large extent.

73
Moreover, entry into the electronics and software industry requires formidable capital

investments. Xiaomi was initially funded with USD41 million in 2010 and the company

went through series of funding and debt financing of several billion USD to reach its

current state.[2] It may not be easy for new market entrants to secure funding at such a

scale to enter the industry.

Additional range of factors that decrease the threat of new entrants to the industry

include access to distribution channels and likely retaliation from existing market players

such as Apple, Samsung, Xiaomi and Huawei.

Bargaining Power of Buyers in Xiaomi Porter’s Five Forces Analysis

Bargaining power of buyers in technology and the mobile internet industry is significant.

This is caused by primarily high level of competition in the global marketplace.

Nevertheless, companies try to reduce buyer bargaining power through developing their

ecosystem.

For example, “all products belonging to Apple ecosystem are highly compatible with each-

other and the purchase of one product belonging to the brand’s portfolio often leads to

the purchase of other products. Gradually, it will come to the point that consumers only

give preference to devices that work best in the ecosystem where they live. The current

ecosystem carefully cultivated by Apple is a powerful customer retention strategy.”

74
Xiaomi is also working towards reducing the bargaining power of buyers through

strengthening its corporate ecosystem in general and increasing inter-dependence of

products and services within its ecosystem in particular.

Rivalry among Existing Firms in Xiaomi Porter’s Five Forces Analysis

Rivalry among existing firms in internet technology industry is fierce.  Increasing popularity

of smartphones and increasing integration of internet into a wide range of personal and

professional aspects of life are further intensifying competition in the global marketplace. 

As it is illustrated in Figure 2 below, the global market of smartphone vendors is currently

dominated by Samsung, Apple, Huawei, Xiaomi, OPPO and LG, among others.

Samsung Porter’s Five Forces Analysis

Threat of substitute products or services for each product category offered

by Samsung is substantial.

Samsung smartphones can be substituted with ordinary mobile phones at any time with

no additional costs for customers. Moreover, there is an increasing range of mobile and

desktop applications that represent relevant substitute for Samsung’s mobile

communications business.

75
Samsung visual display business is threatened by indirect substitution such as increasing

popularity of leading active lifestyle and spending time outdoor. In other words,

representatives of Samsung target customer segment may prefer to spend time outdoors,

rather than in front of TV with negative implications on the volume of sales of Samsung

TV’s.  Furthermore, increasing popularity of cloud storage is emerging as viable alternative

for printing and this tendency may decrease the sales of Samsung printing solutions

products in the foreseeable future.

Rivalry among existing firms is intense.

Approaching market saturation for many product categories in consumer electronics

industry intensifies the rivalry among existing firms and there is a little differentiation

among the range of products offered. Moreover, the great number and diversity of

competitors operating in the market fuels the extent of competition in the industry.

In smartphone market segment, one of its critical product categories, Samsung competes

with a wide range of suppliers such as Apple, LG, Lenovo, ZTE, Huawei, OPPO and others.

Nevertheless, as it is illustrated in Figure 2 below, Samsung has been able to maintain

leadership position in the global scale for the last six years.

Bargaining power of suppliers

 working with Samsung depends on the specific type of supplier. Samsung has 579

suppliers globally and the company’s supply chain includes over 2,700 suppliers in various

industries across the world. Businesses supplying general parts and components do not

yield substantial bargaining power due to the importance of Samsung’s order volume and

its ability to negotiate prices. However, one particular supplier, Google exercises an

76
immense bargaining power as the supplier of Android platform due to the lack of

alternative platforms available to Samsung.

Samsung Electronics duly recognizes the importance of developing strategic cooperation

with suppliers and about 71,4% of total economic value was shared with suppliers in 2015.

[4]Moreover, Samsung maintains an extensive communication with its suppliers within the

scope of various programs and initiatives such as Shared Growth Day, Supplier Dialogue

Fair, Hot Line and informal meetings with suppliers.

FINDINGS

1.Indian smartohone market grew by 48% in 2018 in which Chinese phones have the

biggest share.

2.Xiaomi have the biggest share in annual shipment to India followed by Samsung , vivo ,

oppo and others smartphone.

3.Most sold smartphone in India is Xiaomi’ redmi 4a followed by Samsung J2 pro.

77
4.Xiaomi is the the most preferred brand in india with 9% share followed by Samsung ,

apple , Motorola and Lenovo , one plus and the Micromax.

5.Samsung is a leader in display market segment and has great financial position but it lack

in product safety and competitiveness.

6.Xiaomi is one og the best selling smartphones but its brand value is low as compared to

Samsung.

RECOMMEDATION

 Xiaomi needs to improve its brand image in the market by implementing effective
marketing strategy.

 Xiaomi needs to improve its after sales service.

 Samsung should focus on its product’s safety to build trust among customers.

78
 Samsung should also focus on increasing its smartphone’s to match with other
smartphones.

 To improve customer’s convenience, Xiaomi should also be accessible in offline market

CONCLUSION

79
 India is lucrative market with great potential in smart phone market particularly in
budget segment where most of smarphone are sold.Its growth is almost phenomenal
as compared to other countries..

 Xiaomi is dominating in the budget segment with its flagship phone Redmi amd mi
phones which captured most of the share in the market.

 Samsung is still the great company in smartphone market but it lacks in

innovativeness due to which it is loosing its share .Also it is offering less specs
compared to its competitors within same price range.

 Xiaomi is a major player in India. Their share is growing in the market. Major credit
goes to its high specs combined with low prices of its products.Majority of its phones
are in affordable price range within the reach of larger public.

BIBILOGRAPHY

80
 www.counterpointresearch.com

 www.mi.com

 www.samsung.com

 www.ndtv.gadgets.com

 www.marketing91.com

 www.idc.com

 www.pricebaba.com

 www.mobileindian.com

 www.strategyanalytics.com

81