Xiaomi Development in China: Chinese Iphone

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【MARKETING IN CHINA】

Topic: Xiaomi Development in China: Chinese Iphone

Date: 2nd January 2013

List of Exhibit

Exhibit 1 Xiaomi Developed HistoryPage 3

Exhibit 2 Xiaomi Price____________ Page 4

Exhibit 3 Market Price AttentionPage 4

Exhibit 4 Xiaomi Product AnalysisPage 5

Exhibit 5 MIUI _____ Page 6

Exhibit 6 Mitalk Page 6

Exhibit 7 Xiaomi Post Sales Service Distribution Page 6

Exhibit 8 Xiaomi AdvertisementPage 7

Exhibit 9 Smartphone Development HistoryPage 8

Exhibit 10 Worldwide Mobile Device Sales to End UsersPage 9

Exhibit 11 Smartphone value chain Page 9

Exhibit 12 Global Smartphone System Market SharePage 10

Exhibit 13 Global Phone MarketPage 10

Exhibit 14 2010-2015 Smartphone Market in ChinaPage 11

Exhibit 15 2011 Q3 Smartphone in ChinaPage 12

Exhibit 16 what are the top factors that drive a purchase?Page 15

Exhibit 17Xiaomi SpecificationsPage 15

Exhibit 18 Hyundai’s Capability Development through Product SequencingPage 19

1. About Xiaomi
Xiaomi is a Chinese mobile phone company founded by Lei Jun in 2010. Mi phone was the first Smartphone Xiaomi Tech developed and launched to market in September 2011. The company also developed MIUI, a custom firmware for mobile phones, based on Android system. Xiaomi sells most smartphones online, in limited quantities and by batch to batch. According to the founder of Xiaomi, Lei Jun, the company is focusing on long-term moneymaking potential among Mi owners who watch, shop and surf on their handsets, in other words, they focus on the future Internet business, not Mi sales. Therefore, there's no plan to offer the Mi in shops. By heading in this direction, Xiaomi was quite success in the sales of Mi phone, using a combination of short supply and high-quality, with a low‐pricing strategy. The Xiaomi MI phone had many features similar to phone produced by Apple and Samsung, however, it was offered at only half the price. Due to the potential growth in value, Xiaomi had so far done three times of capital rising, received investment of over USD500 million from international investors. 300,000 phones were pre-ordered in the first 34 hours of online pre-order section, total of around 500,000 phone was sold as of Jan 2012. The company intentionally limits production of the device to capitalize on the consumers’ wants and monitor surpluses. On 20th of December 2011, the company announced a partnership with Chinese telecommunications firm China Unicom, by offering one million custom Mi-one models at 2699 RMB ($421) at Unicom stores on various two to three year term contracts. Exhibit 1 Xiaomi Developed History

2. Xiaomi Existing Marketing Strategy
Xiaomi is a new brand in the market with only 2 years history. We firstly examine how Xiaomi is performing in the market now and then study the smart phone market, competitors and consumer behaviour, which can help us understand more about this interesting new brand and its prospect. 2.1 Positioning

Xiaomi positions itself as a “low price, high quality” brand. Instead of becoming a smart phone manufacturer, Xiaomi wants to build up its own brand. In other words, what Xiaomi sells is not only “product or service” but also a “concept”. 2.2 Pricing strategy

Xiaomi has set the price range of the Xiaomi phone ranged between RMB1500 to RMB2500, which is almost at its cost line. This strategy aims not to earn from margin of selling the phones but to attract more buyers/increase its penetration. For instance, the first version Xiaomi phone 1S was only priced at RMB1499 and newly launched Xiaomi phone 2 is merely at RMB1999.

Exhibit 2 Xiaomi Price
Exhibit 3 Market Price Attention

Exhibit 3 Market Price Attention

According to the survey conducted by ZDC in 2011, this medium-/low-end market has...
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