The Chinese technology company Xiaomi has released its smartphone “Mi Note” on ‘January 27th, which received more than 220 million reservations and was sold out in just 3 Minutes. The “Mi Note”, considered “the Apple of China”, is one of the hottest smartphones on the market that cannot be purchased in the U.S -- it is sold in China, India, Indonesia, Mexico and Pakistan -- basically every market but the U.S. and Europe.
The Mi Note has its own Android-based software ecosystem which happens to look a lot like Apple’s iOS. It has better hardware features than iPhone 6 but is only selling for half of the price - it starts at 2,299 CNY ($370), while the iPhone is $749 for the lowest-spec option. By offering an iPhone trade-in platform, Xiaomi targets to converting the dedicated users of Apple in China into its fans. In 2014, both Samsung’s and Apple's market shares in China have been wiped out significantly due to the 61 millions Mi Notes sold. The Xiaomi company is aiming to sell 100 million devices in 2015, a substantial jump of more than 30% from last year.
Xiaomi imitates Apple's previous approach of "scarcity marketing" in China - heavily advertising its product first and then deliberately restraining its supply way below the frenzy public demand - with the goal of increasing sales through pressure placed on the excited Chinese consumers in fear of missing out. The "hunger strategy" also makes sure no excessive products will be left in stock and depreciate in value.
Interestingly, Xiaomi actually sells its device at a loss. Instead, the company makes money through applications and services, many of which are specific to Chinese consumers, some with a touch of English. However, the system language can be configured to English. Although Xiaomi does not sell its smartphones or tablets in the United States yet, it will be exploring the western market by opening an online shop to sell its brand of headphones and other accessories. Founded in 2010, Xiaomi is clearly a competitive and emerging company with unlimited upside potential in the global market. Keep an eye out on Xiaomi and see when it initiates its IPO. Wait for a Xiaomi phone to be launched in the U.S - its design and price range will make it the biggest rival of Apple and Samsung.
-- Miranda Wang