Xiaomi Tops Chinese Smartphone Market

Just last year, Xiaomi was a relatively obscure Chinese handset maker. But last quarter, Xiaomi was the top smartphone seller in the largest handset market in the world: China.


A report published on Monday by Canalys, the technology research company, highlighted Xiaomi’s remarkable growth, surpassing giants like Samsung and Lenovo to become the top player in China. Because of its huge growth in China, Xiaomi became the fifth largest smartphone maker in the world.


Canalys said that over the second quarter, Xiaomi shipped 15 million smartphones in China, up from 4.4 million in the same period a year ago. Xiaomi beat Samsung, which sold 13.2 million smartphones in China last quarter, down from 15.5 million in the same period a year ago, according to the report.


Over all, Xiaomi grew 240 percent, compared with the second quarter last year, to take 14 percent of the Chinese smartphone market. How did that happen so fast? Chris Jones, an analyst for Canalys, said that while most Chinese handset makers competed on price, Xiaomi took a different path to its branding, marketing and sales strategy.


To lure customers, Xiaomi focuses on offering special software that customers cannot get with other Android devices. The company offers a customized version of Android, called Miui, which customers can help design by giving feedback online; the company releases a new version of the operating system every Friday to keep fans excited.


Xiaomi sells its phones for nearly the same amount it costs to buy and assemble the materials. But it sells the phones for up to a year and a half, giving time for the components’ price to fall. To make money, Xiaomi focuses on selling apps, games and special Android themes and Internet services.


For marketing, Xiaomi runs festivals to show appreciation to so-called Mi fans. Its chief executive, Lei Jun, who has been nicknamed by Chinese media as the Steve Jobs of China, has helped generate a lot of attention for the company.


“They’ve really changed the look of the Chinese market,” Mr. Jones said. “These guys did something different.”


Mr. Barra, who was a vice president for Google’s Android division, has used his industry clout to help Xiaomi form new partnerships with carriers and expand into other markets, he said. The company this year announced plans to expand into 10 new markets, including Malaysia, the Philippines, India, Indonesia, Brazil and Turkey.


In the global smartphone market, Samsung Electronics and Apple are still by far the dominant players. While Apple is continuing to increase iPhone sales, Samsung’s smartphone sales are shrinking in China, in part, because of the intense competition from price-cutting rivals like Xiaomi and Huawei.


Source: nytimes.com