Why is Xiaomi So Popular?

Have you ever wondered why Xiaomi is so popular? You see them on ads, software, online shopping platforms, and of course, (if they don’t already have one) on a lot of people’s bucket lists as well. But, the Chinese giant wasn’t always like this. What gave them their claim to fame?

Xiaomi is a relatively young company in the smartphone industry. Founded in 2010, a large part of their success derived from the spread of their mobile OS, MIUI. The first MIUI OS was based on Android 2.2 Froyo and was initially developed for the Chinese market. They added some apps to the basic framework, including their Notes, Backup, Music, and Gallery apps — and people liked it! MIUI was then translated and ported to unofficial versions in other languages by independent developers.

A year later, they released their first smartphone, the Xiaomi Mi 1, which had the MIUI OS out-of-the-box. Again, people liked it. Xiaomi then quickly emerged to become China’s top smartphone brand in 2014, making Samsung only second best. Fast forward to today, and Xiaomi, along with its sub-brands, continues to be one of the best selling smartphone brands, even surpassing Huawei in terms of smartphone sales (as of Feb 2020 – Strategy Analytics report).

And I”m sure there are a lot of reasons that we can say about how Xiaomi became so well-liked. But to keep things short, let’s just break it down into three:

Low Markups

Xiaomi has always aimed to give consumers amazing products with honest prices. A big reason why they are able to maintain their low price is because of their cost-cutting strategy in terms of how they sell their physical products. Instead of having a major network of its own physical stores with staff, the majority of their sales are sold directly to customers through e-commerce. They also limit the number of units they produce per model to make sure that they are able to sell all their units without having an excess. This looks pretty effective on the company’s end as most of its products are usually sold out upon release.

Another factor for Xiaomi’s affordable price comes from its long term business model. Rather than looking at immediate profits from hardware, they care more about the recurring revenue streams over many years. So, instead of placing a premium price tag on their products, they focus more on connecting smartphones and IoT devices by developing software and services like apps, online videos, and themes.

Ecosystem-centric Sales Strategy

As I mentioned, Xiaomi is not just a smartphone company that sells smart home products. No, they’re more than that. They needed good quality and reputable hardware as a base, but they didn’t bank on just that to ensure their success. They also began to focus on what they intended to do in the first place: build a vast mobile ecosystem. Sounds familiar, right? But I guess that’s not a surprising thing anymore given the fact that they are also widely regarded as the ”Apple of China”. With the way they’re moving, it looks more like an Amazon strategy to me in terms of how they released low-priced Kindles to make consumers buy more of their digital content.

Xiaomi has since introduced several categories under its MIUI Smart Living system, which includes Mi Work, Mi Health, Mi Go, Mi Home, and Mi Game, which all work hand in hand with their respective devices (i.e. smartwatch, smart bulb) pretty well. Surprising how they’re only a decade old company, right?

To paint a bigger picture, if other big Chinese companies like Alibaba and Tencent are pushing their efforts on e-commerce and social networking respectively, Xiaomi has invested largely in 5G and AIoT execution (Artificial Intelligence Internet of Things). And with the Chinese giant expanding their reach by developing other products to be able to interact with their phones, it looks they’re looking to be one of the pioneers in this domain.

And although most of their revenue still comes from smartphone sales, Xiaomi believes that this will all change in the coming future.

Variety of Products

The last reason, which might be the first thing you noticed about the brand, is the variety of products they’re offering. Xiaomi made sure to leave consumers with a plethora of choices, from entry-level devices to flagship-grade phones, all of which are considerably more affordable than their respective competition.

But I’m not talking about just that. Apart from smartphones and wearables, you may have noticed that Xiaomi makes other consumer products as well such as smart bulbs and vacuums for your home, smart rice and induction cookers for your kitchen, smart TVs for your living room, even going as far as developing electric scooters for the urban streets.

And while some of you might think it’s crazy for a smartphone company to be making these products, others might just think it’s crazy good. I mean, I wouldn’t even be surprised anymore if someone told me that they’re developing a Xiaomi car with Mi Apps!

It’s clear what Xiaomi wants to achieve: to create a reliable and versatile platform for consumers packaged in an all-in-one virtual environment, the MIUI Smart Living system. Think of a smart home that you can control from your phone even from a far off remote area. Or perhaps, moving to another place and having all the settings from temperature to light dimness from your old home easily carried over with just one app. That is the vision Xiaomi has. Their goal is to create a system where the software is just as important as the hardware – if not more.

I always appreciate a company that thinks one step ahead, and Xiaomi is precisely that. They know that focusing solely on smartphones will not put the company’s name on the map. That’s what sets them apart from the rest and what makes them popular. They’re already thinking of the long haul—the future where every living space is enhanced and codependent on customizable software. While the fusion of technology and homes may sound a bit too futuristic, it’s not hard to imagine, especially with Xiaomi devices. Just wander into a Mi Authorized Store and see it for yourself.