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Assignment no.1

Topic Marketing activity for Xiaomi

Company

Subject: Fundamental of Marketing

Submitted to: Prof. Mubasher Hussain Naqvi

Submitted by: SYED AMMAD Ali Naqvi

Roll no: 10

Class: BBA (hons)

Semester: 3rd

Session: 2021/2025

Department of Business Administration

Govt. Postgraduate College (Boys) MZD
Affiliated with UAJK

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Acknowledgment

Very thankful to Prof. Mubashir Hussain Naqvi as a brilliant and polite teacher and all those
people who help me in making my assignment.

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 Preface

In this assignment we have discuss about marketing activities of Xiaomi company as we discuss
about the promotion marketing portfolio and executive summary of a company. We discuss
about company description backgrounds.

We touch the company over view portfolio and segmentation, targeting and positioning. The
consumer buyer behavior of Xiaomi company. Promotional activities of a company and the
most important aspect communication .

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 Content

1 Introduction to Xiaomi company………………. …………………..…….…....….. v

1.1 Marketing Strategy…………………………………….……………………...…… .v

2 Marketing Mix of Xiaomi ……………………………………………...……...…..... vi

2.1 Place and Distribution Strategy……………….……………………..……….……. vii

3. Promotion Strategy of Xiaomi………………………………………....….….…..… vii

4 .SWOT Analysis of Xiaomi………………………………….……….….……..….... vii

4.1 Strength……………… …………………………………...…………….......…….. vii

4.2 Weakness………………………………………………..……….……..………….. vii

4.3 Opportunity…..……………………………………………..……..……..……....…viii

4.4 Threat………………………….……………………………..………...………...…viii

5. Analysis of culture Environment……………………………………….…….…….. viii

5.1 Seasonal promotion………………………………………...…………………..……xi

6. Competitive Strategy……………………………………..……………..……..….…..xi

6.1 Performance Measurements……………………………………….…………..….…xi

6.2 Consumer Condition Analysis…………………………………...…..…………..…. .x

7. Strategy of Elevating Marketing Strategy………………………………...…….…... ..x

8.Conversation al of Targeting………………………………………….……..….……..x

9. Marketing Collateral…………..…………………………………………..........……..xi

10. Conclusion and Finding ………………………………………………..xi

11. Conclusion.……………………………………………...............................................xi

12. References ………………………………………………..…………………..…….xiii

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1.Introduction

5 years it has been observed that the smartphone industry has grown exponentially. Long gone is
the time when the consumers needed to carry 2-3 kg laptops for their daily requirements.
Nowadays big brands like Xiaomi have been adopting the strategies of hunger marketing where
the availability of the product is intentionally restricted by the manufacturer to create surplus
demand in the market. A major change has been identified in the usage pattern of consumers
which has been strategically tapped by companies [2]. Xiaomi’s first android based firmware
Maui was launched on 16th August 2010 and a year later it launched is first smartphone Mi1 in
China [5].

The product became successful and further new models were launched namely M2, M3 and
Redmi phones on the domestic front. Xiaomi hired Hugo Barra (ex. Google Android Executive)
who paved the way for its expansion in the offshore markets. After successfully capturing
significant market shares in the rest of Asia, Xiaomi entered Indian markets in July 2014.
Initially Xiaomi made an exclusive partnership with ecommerce giant Flipkart to sell its
smartphones but later on 7th April 2015 they changed their distribution strategy and announced
partnership with Amazon and Snap deal. They first started productions in Sicily (A.P.) at that
time 200 million people owned a smartphone out of 1.2 billion people.

By the end same year, they captured 1.5% of Indian market share which doubled in 2015
competing along with homegrown brands like Miramax, Lava and other international brands like
Samsung.77% of the smartphones were locally made that benefited them in reducing the
operational costs. By the same time Xiaomi had overtook Samsung and Apple by the end of
2015 in China [2]. Axiomatic which was ranked 2nd amongst 50 other reviewed reputed
companies (viz. Apple, Google, Microsoft etc.) by MIT technology review (2015). This
happened just within a year Xiaomi stepped in the Indian

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1.1.Marketing Strategy

Penetration into any foreign markets requires various mix of marketing strategies which will
impact success of any firm. It can be achieved in 2 ways. They can either use traditional
marketing mix or can customize their existing mix according to the requirement of the country. If
same marketing mix is used in the export country to attract customers, standardization strategy is
normally used by the firm as it requires less investment as compared to adaptation strategy but
the trends observed in the present scenario reveals that companies are customizing products
according to consumer needs rather than providing a single product throughout its worldwide
market [9]. Creating brand loyal customers is an important step to ensure future egad it can be
done by exceeding their expectations [4]. Companies.

need to face competition in order to survive in the market. As smartphone manufacturing has
gained momentum the primary way of having a competitive advantage and ensure survival it is
important that firms maintain their profit margins while simultaneously expanding the customer
base [11]. 3.2 Marketing Strategies adopted by Xiaomi expanded and established itself as a
valued startup and it has a chance of becoming the world's top most smartphone company. There
are two basic competitive strategies followed by Xiaomi that are manufacturing products with
superior qualities and features and produced at a lesser cost. In addition, there are certain extra
features that are present in Xiaomi phones that drive the attention of the customers towards it.
Before launching its phone, the company had surveyed the market aggressively and analyzed the
competitive strategies of smartphone giants like Apple and Samsung. Those were having strong
customer loyalty having a robust operating system that is Android. Android was chosen as the
operating system and Xiaomi designed MI UI its own customized operating system based on
Android with added cloud services, security, apps, music, video player, browser and many more
common items [3].

The core competitive strategies adopted by Xiaomi competitive cost, quick expansion in the
offshore markets, less margins and selling products online exclusively. Indian market is very
diverse and large and it is difficult to penetrate it in one go hence Xiaomi chose a narrow
segment to cater initially which aspired to produce a great product but at the same time at lower
costs for the cost conscious customers. These are the following market strategies adopted by
Xiaomi [6]. 3.3 Innovating the products Xiaomi always believed in a system in which there is
continuous innovation not only for their operating system but also for their marketing strategies
and programs. The products mainly smartphones manufactured by the company are of superior
quality and their aimed to provide value for money proposition to their customers its sub brands
known as MI and Redmi have been delivering great value for money smartphone models. Some
of its famous mobile phones were 4S, MI 4 and Redmi Note 3. These mobile phones had rocked
the market with huge sales and continue to do with their latest upgraded models being released

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regularly by the company. Redmi Note 3 as per IDC was the highest shipped device in the
history of online smartphone industry with more than 2.4 million within 6 months.

2. Marketing Mix of Xiaomi

Marketing mix model is a practical way of conceptualizing how you should in a business. The
framework of this model is based on the parameter of 4Ps:Product, Price, Place and Promotion.
This framework helps in understanding what is offering and how it is offering to its target
audience and target market. So let us know go the first 4Ps in the comings section concerning
Xiaomi’s offerings Marketing Mix of Xiaomi.

Marketing mix model is a practical way of conceptualizing how you should approach marketing
in a business. The framework of this model is based on the parameter of 4Ps:Product, Price,
Place and Promotion. This framework helps in understanding what a bring and how it is offering
to its target audience and target market. So let us know go the first 4Ps in the comings section
concerning Xiaomi’s offerings

2.1 Place Distribution Strategy of Xiaomi

Xiaomi is now present in over 100 countries with an affordable range of smartphones,

smart TVs, laptops, wearable and gaming devices. With a global footprint, great at competitive
prices, the company is expanding its reach to various new

markets every year . Most of the sales are done online rather than offline which has also proved
to before the manufacturer and as well as the consumers. However, it has shifted focus towards
expanding into offline markets as well.

3. Promotion Strategy of Xiaomi

In its starting years, Xiaomi relied very little on marketing. But now, it has shifted to a more
active approach in promotional activities as it focusing on key regions like the US and Europe,
India as well as China itself. Xiao’s strategy changed dramatically around 2016. The company
realized that it needed to expand beyond just selling its products and started focusing

specifically on India and China — two countries with large populations but limited disposable
income.

4. SWOT Analysis of Xiaomi

A SWOT (Strength, Weakness, Opportunities and Threats) analysis is used to identify strategic
opportunities and weaknesses within a company for management to take effective action. It
basically represents a clear picture of problems, opportunities and helps in implementing a
prospective change.

4.1 Strengths of Xiaomi

• Xiaomi is one of the largest smartphone makers in today’s time

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• Sells the products at very affordable and low prices

• Variety of products on the shelf to offer

4.2 Weakness of Xiaomi

• Online sales have proved to be beneficial but also has been a weakness for the company
because not everyone trusts buying from online platforms

• Xiaomi misses the chance to reach high-income customers as it has created an image that tells
the audience that its products are made for middle-class customers.

4.4 Opportunities The brand has started focusing more on its offline stores which can increase
their sales

and bring in more revenue

• Creating strong research & development like that of Apple & Samsung will help Xiaomi

to adapt to various technological changes quickly

5. Threats for Xiaomi

• Xiaomi’s biggest threat is the presence of numerous competitors within the industry

• Misinformation and rumours about the brand

• in the market can also be a huge threat. This is why people should be well informed

about the brand and the products it offers.

• Controversies are a huge risk to any brand. Xiaomi should be extremely cautious while

getting associated with any type of controversy.

With this, the comprehensive case study on Xiaomi comes to an end, let us now go

through the final thoughts in the coming section.

5.1 Analysis of Cultural Environment

Xiaomi executives must consider the marketing mix before attempting to increase market share
in India. In doing so, it is important to address cultural considerations related to foreign
expansion. Due to rapid technological advances in India, consumers are receptive to products
that help them save time and effort. Indians also value products that make it easier to complete

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specific tasks. In Indian culture, views of material comfort are shifting rapidly. In the past, Indian
consumers felt they were living in material comfort if they had more things than other people.
They now feel that they are living in material comfort if they have higher-quality items than
other people. Indian consumers also tend to value youthfulness, but they believe youthfulness is
about acting young regardless of age. It is important to distinguish between the views of rural
Indian consumers and urban Indian consumers. In urban India, consumers are more receptive to
smaller products. Rural consumers still cling to the belief that bigger items are better than
smaller ones. Xiaomi executives must also respect gender norms in the Indian culture. Although

6. Competitive Strategy

Xiaomi has a distinct competitive advantage over Apple and Samsung in terms of product appeal
in the Indian market. Middle-class consumers are not interested in purchasing expensive mobile
devices and upgrading them annually. Xiaomi’s competitive strategy should be to position its
products as affordable alternatives to devices made by Apple and Samsung. Because Xiaomi
manufactures cell phones that do not need to be upgraded every year, the company’s product
offerings are more likely to appeal to consumers in the Indian market.

6.1 Performance

Xiaomi executives must measure marketing performance to ensure they are meeting their
objectives. Hellenes describes several methods of objective measurement. Sales by market
segments, sales growth rates, market share, and return on investment are some of the measures of
performance related to the product aspect of the marketing mix. In this case, it makes the most
sense to measure performance according to market share. The initial objective was to increase
Indian market share by twenty percent within three years. If executives determine that market
share has increased by twenty percent or more, they have met their objective. Price changes
relative to sales volume and price relative to competitor are two measures of performance related
to the pricing aspect of the marketing mix. Xiaomi should use price relative to competitor as a
measure of success because the company’s competitive strategy is based on pricing

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6.2. Consumer Condition Analysis

The consumer condition analysis will be conducted using UTAUT2, the extension of UTAUT l
which stands for The Unified Theory of Acceptance and Use of Technology, this method will
answer what factors that affect consumer behavioral intention in using Spotify as music-
streaming service. Based on a review of the extant literature, Denktash et al. (2003) developed
UTAUT as a comprehensive synthesis of eight prior technology acceptance research for example
TRA, TAM, and TPB. UTAUT2 has seven key constructs, performance expectancy (PE), effort
expectancy (EE), social influence (SI), facilitating conditions (FC), hedonic motivations (HM),
price value (PV), and(H), that influence behavioral intention to use a technology and/or
technology use. Figure 2.1 The UTAUT2 Modeling this research, the population is the millennial
residents of DKI Jakarta and West Java province aged 18-37 with the total amount of around 19
million (Baden Posit Statistic 2017 and 2018) as a subset of individuals chosen randomly from a
larger set using a simple random sampling. This statistic technique is used due to the limited time
of conducting the research. Each respondent has the same probability of being chosen at any
stage during sampling process11, but still has the same standard because all respondents are
given the same screening question. The sample in this research will be determined using Solving
formula. With margin of error rate is 10%, and N = 19.000.000.

7. Strategy and Evaluating Marketing Appointment

Since its operation in 2010, MI has adopted new mode of operation. Under the condition of zero-
stock cost, MI lowers the prices significantly in order to capture the market. Adopting concentric
diversification can help to strive for more users, control product design and sales operation.
Outsourcing hardware production and assembly can drastically reduce fixed costs of enterprise.
With the expansion of operation team, MI begins to turn single products into diversified
products. Acknowledges of the products

8.Conversational Marketing Targeting

▪ PRIORITIZE POSTS THAT WERE MADE WITHIN THE PAST 3 HOURS.

▪ AIM FOR 20-30 RESPONSES PER HOUR. DO NOT EXCEED 50 POSTS PER DAY ON ANY INDIVIDUAL
CHANNEL.

▪ 70% OF TIME SHOULD BE SPENT FINDING THE LEADS, 30% REPLYING.

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▪ ACCORDING TO COMPETITOR ANALYSIS OF SAMSUNG AND HUAWEI WE RECOMMEND 40% OF INITIAL
SOCIAL MEDIA EFFORTS TO BE ATTRIBUTED TO YOUTUBE, 35% TO FACEBOOK, 20% TO INSTAGRAM, 5%
TO FORUMS.

▪ FOCUS ON CONVERSATIONAL ENGAGEMENT WITH POSTS COMPLAINING ABOUT COMPETING

TECHNOLOGY. EXAMPLE BELOW:

9. Marketing Collaterals

The following items will be necessary for your promotion and should be developed prior to the
commencement of making.

▪ Social media content – covering all 3 social channels for month 1

▪ Social media imagery – cover the major verticals I discussed

▪ SEO content – at least 8 articles for the first month of distribution

▪ Email funnel – as covered above.

10. Conclusion and Finding

• Xiaomi has become one of the most valuable startup from valued currently at US 50 Billion
Dollars. It made huge success in the smartphone selling business by implementing mix market
strategies which have proven highly successful in the global as well as domestic markets.

• Xiaomi has marketed itself in the lower and mid-tier of the market and has not established or
tried to establish itself only a premium product manufacturer which has become one of its
biggest strength.

• The strategy of creating the buzz of a company which has also been adopted by top tier brands
like Apple and Samsung has been successfully created by Measurement.

. Which means music streaming platforms are in a safer position when there is an abundance of
suppliers.

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11. Conclusions

There are two research questions in this research, first is “What factors affect free and premium
users’ behavioral intention in using Spotify?”, and the second is “What marketing strategy
should be applied to keep their current free and premium users and gain more potential user?”.
To first research question, there are two analyses conducted, internal analysis using STP and
4Ps, external analysis using competitor analysis and Porter 5 Forces, and consumer condition
analysis using factors from UTAUT2 which resulted that there are differences on factors
affecting the behavioral intention in using Spotify between free and premium users. For free user
respondents, the factors that can predict behavioral intention in using Spotify is Facilitating
Condition (FC) and Habit (H). This means that free user respondents are affected by the
resources and support are available touse Spotify and they believe that using Spotify is
automatic. For premium user respondents, the factors that can predict behavioral intention in
using Spotify is Hedonic Motive (HM), Price Value (PV), and Habit (H). This means that
premium user respondents are affected by their experiences, enjoyment, and pleasure from using
Spotify. Because they paid some money in exchange of premium features, they are also affected
by the price value where they measure the benefits of using supply the monetary costs. Lastly,
Habit as the strongest factor affects premium users as they believe that using Spotify is
automatic. The results from the analyses are made into a SWOT analysis evaluating Spotify’s
strengths, weaknesses, opportunities, and threats. After that, TOWS matrix is generated to create
the proposed business solution. From 7 alternative strategy from the TOWS matrix, there are
some alike strategies that can be aligned into one comprehensive plan resulting in total 5
proposed marketing strategy for Spotify

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Reference

[1] J.L. Dong, “CHEN Juan. Xiaomi Business Model Innovation: Redefining the Relationship
Between a Manufacturer and Its Customers,” China Soft Science,vol.8, pp22-33, 2015. [2] S. W.
Zing, P. Li, “The timing of latecomer firms’ market entry based on disruptive innovation”,
Studies in Science of Science, vol. 34,pp.122-131, 201.

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