The Xiaomi Mi5 has quite liked among the community. It is certainly the most complete and best finish terminal Chinese manufacturer specifications we consider high – end yet maintains a price (between 300 and 400 dollars) which is far from the usual in the segment. What is the trick Xiaomi to offer a smarpthone this level with such a price? Why do not other manufacturers?
In addition, you anticipate that you should not illuminate Xiaomi because the case is almost unique and there are a number of circumstances that allow you to have those prices and that are not common in the industry. Neither possible currently. Its case is one of the few examples that exist that sell cheap can bring benefits and growth in a company, but with 11 peculiarities that only Xiaomi has and add one after another to get a team like MI5 has a price it is almost half that offered by Samsung, Sony and Apple, among others.
Its main markets are untapped
No presence in markets such as Dollarpe or the US, Xiaomi continued to grow last year at a good pace and exceeded 70 million smartphones sold, representing 14% compared to sold in 2015, the actual year of the launch of the company. The secret is that their large fiefdoms are powerful and huge growth markets such as Russia, India, Brazil and China. In its native country redmi Note 3 was the best selling in the last quarter of 2015 terminal, and in total, the company already has more than 15% market share there. It is the leading company.
However, any cut in the growth of any of these markets is a sharp pullback also for Xiaomi. China passed IDC 20 to 1.2% in sales growth between 2014 and 2015, which meant that estimates of 100 million units was expected to be placed on the market in less than 70 remain.
Services that provide benefits
MIUI is the operating system that comes standard with Xiaomi smartphones. It is a fork of Android that has made the Chinese company and which includes services, applications, themes, advertising and games, among others. With an established network of more than 100 million users MIUI basis , the movement in its application store is over 35 million apps per day, with profits games only about 30 million dollars a month.
Here is certainly one of the keys Xiaomi: you can cut profits at its terminals because it compensates with other fronts their accounts at the end of quarter.
Without traditional advertising
Faced with huge budgets for marketing and advertising that manage large electronics (Apple, Samsung, Microsoft, Lenovo, LG … almost anyone you can think of), Xiaomi focuses its efforts on alternative media that give satisfactory results to be found there much of its potential audience.
Social networks, forums, online stores and word of mouth are its logistics centers to be known. In total figures, investment in advertising Chinese company is hovering around 4%, light years ahead of what drives a giant electronics in the West.
Few models is very widespread
The new Xiaomi Mi5 arrived this week and is the natural successor to the previous “high end” of the company, which was presented in the second quarter of 2014. Nearly two years ago. Hard to imagine any other traditional electronics company taking two years to renew their best smartphone. In addition, the company does not have an exaggerated or full catalog of models and configurations.
The own CEO, Hugo Barra, consider this one of the keys to the success of your company: small catalog, very controlled production, and a very long life for each product. They can reduce the price of equipment on several occasions, get better prices by volume and time, and of course profitable investments in each model. Perhaps the beginning of the life of a new model is not the use of the latest components profitable, but eventually that margin improvement for Xiaomi, ensuring while valid enough hardware to get in a position to the next generation, though pass on average between 18 and 24 months.
Precisely in order to maintain the same model almost two years on the market without suffering, Xiaomi cares about the software and updates. Its policy in this regard is strict, still very frequent new releases and upgrades, which is something not very common in today’s market and draws on the community; on the other hand, it is possible and faithful of this care in the details related software Xiaomi.
A loyal community
Perhaps only Apple can boast of a legion of faithful as having Xiaomi. We do not talk about numbers but in attitude and continuous activity.
Since its inception in 2009, forums, social networks and web platforms have been different places for information exchange and which has created a community of users and followers of the company. We all remember the exclusive sale in 2012 of some terminals in the giant social network Weibo, a success.
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It is an assembler expert, little innovative
Few manufacturers followed to the letter the idea of assembler. If something, a smartphone of the company is to integrate premium components and features reputable manufacturers. One example is the last E5, leading Sony, Samsung memories and processors Qualcomm.
Own little innovation you see in the terminals Xiaomi that department because the company does not have much travel today at the hardware level.
Not in major Western markets
Without a significant burden on innovation and limited to assembling very successful way, Xiaomi is difficult to jump into markets such as Dollarpe or the US. Its lack of patents would force him to make a huge investment that would make it almost impossible to continue offering prices so tight in such good terminals. Their presence in the larger western markets is limited to a range of accessories.
A good component integrated into their handsets, Xiaomi adds an attractive and tempting design. Inexpensive is not associated with at any time not correctly finished or common design in the case of Xiaomi products. In addition, that idea keeps in its entire line of devices and accessories. Here, as happens when assembles its devices, there is little innovation in the design and interface of your operating system or in the manufacturing of their equipment. Another savings for the company.
Direct sales, online and flash
Xiaomi, without reaching the ends of OnePlus has a peculiar way of getting your products. The sale is direct, without intermediaries online usually. Extra costs and agreements with third parties are avoided. We also have to add its flash sales system, criticized by many but allow more aggressive price adjustments have controlled the production and maintenance costs without stock.
Ecosystem of products that create brand
In certain markets, it is not possible to buy directly smartphones Xiaomi but some of its best-known accessories such as bracelet, headphones, speakers, cameras action or batteries. Most of these products meet the good, nice and cheap, and that helps the company to create brand. A total of 16 product categories which can have Xiaomi.