Xiaomi is currently the number one smartphone manufacturer in China and placed third in the world. This company has been extremely successful lately and it seems like there’s no stopping for them. They have conquered their home market, China, and are doing great in India thanks to their “Flash Sales” via Flipkart and are planning an expansion to South America and Russia, both of which are amongst the biggest markets in the world. All of this wouldn’t be all that weird if this company isn’t only 4 and a half years old. Xiaomi was founded in April 2010 and is already causing problems for the world’s most popular companies. Xiaomi will probably target US and Europe at some point as well, but they have to succeed in South America and Russia first. Xiaomi has a rather particular marketing system and general business model which works perfectly in Asia, but will it work outside of it? Well, I don’t think so, there are several reasons Xiaomi will have to implement different practices and adapt in other markets. Let’s see what obstacles might this company face soon.
Xiaomi had huge success in emerging markets thus far, markets like China and India. They used certain principles to sell their phones there, those markets are more prone to handsets which cost less and aren’t all that picky when it comes to branding, or at least weren’t in the past while Xiaomi was getting popular over there. It will be different in other markets where certain manufacturers are already well-known brands and consumers care somewhat less about pricing. The second obstacle Xiaomi might face has to do with social networking. Xiaomi has a huge following on Weibo, the Chinese social network. That’s not the case in other social networks, compared to Weibo of course, besides, consumers in other countries are used to different approaches and are used to seeing huge billboards and TV commercials everywhere they go. It will be interesting to see how well Xiaomi adapts to different markets.
Patent wars are yet another concern for the company. Things are done differently in other markets, Xiaomi might face lawsuits all over the place if they enter US and European markets for example. It’s not exactly a secret that Xiaomi’s handsets as well as their MIUI OS are Apple-inspired and I’m rather certain Apple will sue them if they enter certain markets. Apple is not the only threat though, Xiaomi should consider a lot of things before launching their products abroad. Talking about software, we come to a fourth obstacle, Google services. While MIUI is based on Android and some Google services are available, some of them are not. Some Google services are actually banned in China and Xiaomi might have to alter MIUI in order to cater to consumers abroad. Another thing Xiaomi might have problems with is certification, well, it’s better to say certifications. There are a ton of governing bodies all over the world which will have to approve Xiaomi’s handsets before they can enter the market.
Xiaomi might be a huge company in Asia, but there are a ton of things this company needs to consider before entering countries outside of Asia. Things are done differently there and it will be a real challenge for this company. If Xiaomi manages to overcome those obstacles, they could become the world’s number one manufacturer one day. Hugo Barra will quite probably play a huge role in Xiaomi’s expansion, as he was basically hired for that purpose and we all know he has tons of experience which he acquired while he was working for Google.
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