Xiaomi

In the modern mobile market the competition has increased so much that the
newcomers have to have a certain differentiation basis in order to compete with the rival
competitors and their products.

Xiaomi is essentially a hardware software company which has a huge fan base and is
comparable to apple in those terms. However, the difference is that apple develops
good software and hardware and sells them at ludicrous prices while Xiaomi sell their
product at cost price with minimal profit margin while also taking into account customer
opinion. That is be the reason that Xiaomi is also called the “Apple of China”.

Xiaomi has had to compete with mobile manufacturing giants such as Samsung,
Apple, Huawei etc. in order to differentiate their product from the rest of the products
already available in the market.

Following are the reasons Xiaomi was able to overtake iPhone in India and China in
smartphone sales and became the 5th largest smartphone manufacturer.

Low Cost high value products

One of the standout features of the brand is the competitive price: Both the new Mi Mix
3 and the Mi 8 Pro are priced at £499, half the price of an iPhone XS. Xiaomi Mi 8 pro is
essentially the same as its iphone counterpart iPhone XS in terms of features and
specifications maybe even better than iPhone, however the price is almost half of that of
iPhone XS. The reason is that Xiaomi has a set maximum profit margin limit which was
2-3 percent more than the manufacturing cost which has now been increased to 5
percent in 2018. The company publicly stated that it will not take more than 5 percent of
profit and will return the rest to the customers.

Marketing strategy
Xiaomi does most of its marketing online instead of using traditional billboard approach.
With the growing interest in the social media sites many organizations are using social
networking sites as a platform for advertising their products. Xiaomi is making use of
this opportunity in order to attract potential customers.

MIUI ROM
Xiaomi was founded in April 2010 by ex-Kingsoft CEO Lei Jun, as a software company
creating a new custom ROM based on Google’s Android. Their aim was to provide
additional functionality that Android had yet to offer and an easy to use user interface.
MIUI, the ROM which the team created, became a huge success and has been ported
to many devices. As of 2014 MIUI can be downloaded and installed to over 200 devices
in both English and Chinese, even non developers can easily install MIUI to their
phones using the MIUI Express APK. The MIUI ROM was likened to Apple’s iOS for
being very easy to use whilst providing sophisticated services such as cloud backup, an
easy to use music player and their own app store.

Features of both Android and iPhone

Being a market follower into the smartphone business Xiaomi only carries the best
features and specifications of iPhone and Android at the lowest possible price thus
besting both the smartphone giants causing its sales to top even theirs in India and
China.

Unibody ceramic design

Xiaomi is competing on all fronts with its rival products such as design, new features,
style of the handsets etc. All the mobile phones in the market are the same either
having a plastic or metallic frame. Xiaomi was the first to introduce a frame made of a
single piece of ceramic which offered a design innovation thus, standing out in the
market. The new Mi Mix 3 was the first handset to use such a body.

Rising brand awareness

Xiaomi’s brand awareness is constantly increasing and more and more people are
getting to know about it with the increasing usage of internet. This will result in
increased sales and increased brand loyalty thus paving way for an even better future
for the company.

Quality
Even at such low prices Xiaomi offers the highest quality smartphones. These
smartphones are regularly rated high on all e-commerce portals which gives a stamp of
approval to the brand and also testifies that Xiaomi does not compromise on quality
even if the prices are rock bottom.

Need for inexpensive smartphones

People are tired of spending money every year to shift onto the latest Samsung or
Apple iPhone. People are looking for cheaper alternatives that offer the same features
for a suitable price. This is a huge opportunity for Xiaomi since the trend for expensive
mobiles is coming to an end and people are slowly starting to think of mobile phones as
a need instead of a luxury.
All these factors are the reason that Xiaomi is competing with the rest of the
smartphone countries and is currently beating them at their own game. While Xiaomi is
currently selling all of its products online it is thinking about opening its own retail stores
through forward integration of its supply chain. This will exponentially increase its sales
that are already sky rocketing which will encourage the brand to expand even more,
both in length and depth.