Competitive Strategy of Realme against Xiaomi

Introduction
India is the second largest smartphone market after China. There are currently close to 420
million smartphone users in India which is expected to grow to 490million users by the end of
2022 with an annual growth rate of 8%. So, India is a promising country for the brands to
invest in and market their products.
With a market share of 29% by the end of 2020 Q2, Xiaomi has established itself as a market
leader in the smartphone segment. It has also diversified its products into the segments of
television, smartwatches, and other electronic gadgets. Xiaomi is closely followed by
Samsung, Vivo, Realme and Oppo with market shares of 26%,17%,11%, and 9% respectively.

Realme vs. Xiaomi

Realme originated as a sub-brand of Oppo in 2018, which later spun off into a standalone
entity. Within a year, it achieved a staggering 600% YOY growth. Realme has been keen on
colliding head on with the smartphone giant, Xiaomi. It directly focused on online
distribution, unlike other brands like Oppo and Vivo, to compete against Xiaomi.
Although Xiaomi dominated the online channel with 40% share, Realme had also started
capturing online share and by 2019, it grew to 26.5% from 16.5%. Realme had developed a
favourable image in the minds of consumers within a very short span of time. A survey by
Mobile Industry Consumer Insight (MICI) revealed that Realme had established itself as a brand
with better smartphone designs, better reliability, and ease of finding service centres.
Moreover, as compared to Xiaomi, Realme had lower return rates.

Attack Strategy
Realme has adopted a Frontal Attack Strategy by taking Xiaomi head-on. It has been
constantly matching Xiaomi’s products, features and adopting similar marketing and
promotion strategies. This has not been restricted to just the smartphone segment. Both the
companies have ventured into other segments of durables competing against each other.

Comparable Smartphones

Xiaomi Redmi 9A vs Realme C11 (Both were launched on 30th June 2020)

Specifications Xiaomi Redmi 9A Realme C11

Storage 32GB 32GB

Battery 5000 mAh 5000 mAh

RAM 2GB 2GB

Processor Octa Core 2.3GHz, Cortex A53 MediaTek Helio G25

Operating System Android v10 (Q) Android v10 (Q)

Price Rs. 6390 Rs. 7590

War of Words
The spirit of competition has not been limited just to the market. The high level leaders of
both the companies have constantly been seen taking a dig at each other on social media
platforms as well. A recent occurrence was when both the companies claimed that they were
the first to integrate the first indigenous navigation system developed by ISRO, NavIC, in their
smartphones. Apart from this, there have been more such occurrences in the past.

Future Prospects
With the growth of smartphone users in India, the competition will only get more fierce with
each brand trying to differentiate its product and provide more value to the consumers. Being
the market leader, Xiaomi has the upper hand in driving change but the ability of Realme to
adapt quickly has made it a dominant player in the market now and in the times to come.

Exhibit 1 Exhibit 2

Exhibit 3