Xiaomi Corporation

Company Background:

Xiaomi Corporation was founded in April 2010 and listed on the Main Board of the Hong
Kong Stock Exchange on July 9, 2018 (1810.HK). Xiaomi is an internet company with
smartphones and smart hardware connected by an IoT platform at its core. With the vision of
being friends with its users and being the “coolest company” in the hearts of its users, Xiaomi is
committed to continuous innovation, with an unwavering focus on quality and efficiency. The
company relentlessly builds amazing products with honest prices to let everyone in the world
enjoy a better life through innovative technology. Xiaomi is currently the world's fourth-largest
smartphone brand, and has established the world's largest consumer IoT platform, with more
than 150.9 million smart devices (excluding smartphones and laptops) connected to its platform.
Currently, Xiaomi products are present in more than 80 countries and regions around the world
and have a leading foothold in many markets.

1.) Strategic Intent

Xiaomi’s strategic intent is to capture a greater market share in the smartphone industry
or the tech industry in general.

2.) Strategic Mission

Xiaomi’s Mission statement is ‘MAKING QUALITY TECHNOLOGY ACCESSIBLE
TO EVERYONE.”

3.) Strategies that are aligned to the strategic mission

Rather than a strategy, the company started its business with a philosophy: “first get big,
and then get good.” In order to achieve this, the company had an idea to produce
smartphones similar to iPhones of Apple, price them to significantly undercut other
phones while earning positive margins for the sale of each device.
 Now the company’s main strategy in the market is to:
1.) Gathering and utilizing a large fan base.
- By using word-of-mouth marketing strategy, they reduce their advertising and
marketing expenses by relying on their customers to make their brand grow
2.) Designing great products at a reasonable price
- They design phones that rivals the flagship smartphones of big company like
Samsung and Apple at a price that is competitive in the mid-range market
3.) Constant optimization of products through eco-chain.
- They release new iteration of their smartphones at an average of 6 to 12 months
with a better hardware and/or software of the previous iteration.

4.) Implementation of the strategies

They mostly use the internet to sell their phones via their own website or via 3rd party
buy-and-sell websites/apps such as Lazada, Shoppee and Amazon which reduces their selling
cost significantly by minimizing advertising cost. They sell their phones at competitive price
while maintaining a premium feel of a more expensive phone. They also create scarcity of
their products so that to reduce wastage and making their customers urge to buy their
products due to its limited supply.

5.) Evidence that the company achieved above average returns after the
implementation of the strategy
In their 2018 financial reports, they incur revenue from their smartphones alone around
113.8B CNY or roughly 870.57B PHP. Compared to 2017’s revenue of 80.6B CNY or
614.978B PHP, that is a 41.56% increase of revenue from their smartphones.
Their market share in the world at the end of 2018 is at 8.44% of the total world-wide market
and 7.1% at the end of 2017.
REFERENCES:

https://www.mi.com/global/about/

https://globalnetwork.io/perspectives/2017/11/success-without-strategy-xiaomi-
paradox

https://research-methodology.net/xiaomi-business-strategy-competitive-costs-and-
large-ecosysem/

https://www.techinasia.com/10-strategies-xiaomi-secret-sauce

https://www.reuters.com/finance/stocks/income-
statement/1810.HK?stmtType=INC&perType=ANN

http://i01.appmifile.com/webfile/globalweb/company/ir/meeting_us/2018_Annual_Result.pdf

https://www.idc.com/promo/smartphone-market-share/vendor

http://gs.statcounter.com/vendor-market-share/mobile