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Xiamoi: China’s new handset player

August 20, 2012

Xiaomi is one of the most interesting brands in China right now, founded by the charismatic 43 year-old Lei Jun, who controversially models himself on Steve Jobs and made a bunch of money selling a company to Amazon.

Jun’s company, while modeling himself and some aspects of his phone design on Apple, is trying hard to be more than a copycat player.

Evidence of this can be seen in last week’s media launch of its M2, which boasts a 28-nanometer quad-core processor from Qualcomm Inc., a 4.3-inch display, and an 8-megapixel backside camera.

The big threat to other players in the market is the pricing; Xiaomi’s M2 is going to sell for 1999 Yuan (about $311), which is less than half the price of equivalent models from the likes of HTC and Apple.

This is a phone with the technical specs to rival the world’s leading smartphones and some Chinese manufacturers have already taken note and are selling fakes.

Xiaomi’s M2 is building on the success of last year’s M1 which sold 300k phones in a two day period ( 3million total) using the same aggressive pricing strategy and it was very successful in online channels.

There’s more than aggressive pricing behind the company’s success, it has a localized OS called MIUI; based on Android and sent out in weekly software updates to users. The combination of these elements and the high profile of the founder has turned Xiaomi into a recognizable brand in just over a year.

While the brand has achieved significant success in the short-term, its still a small player and in a market dominated by Samsung, has only a 5% share.

The M2 will be made available to the public in October and looks set to grow Xiamoi’s brand awareness and market share.

Xiamoi is interesting because while it’s certainly learning from Apple’s playbook, but instead of merely copying, it’s using an intelligent marketing strategy, to build a distinctive brand.



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