In the last two decades many technology startups were created and according to statistics, less than the 10% succeeded. A success story is Xiaomi, a company founded in 2010 in China which in less than 10 years has become a hi-tech giant with a revenue of over 20 billion dollars.
Xiaomi is now the world’s fourth-largest smartphone manufacturer but it also develops a wide range of consumers electronics.
Xiaomi’s founder and CEO Lei Jun, about the company’s name meaning stated that “Xiao” is referred to the Buddhist concept that “a single grain of rice of a Buddhist is as great as a mountain,” suggesting Xiaomi wants to work from the little things, instead of starting by striving for perfection, while “mi” is an acronym for Mobile Internet and also Mission Impossible, referring to the obstacles encountered in starting the company.
Xiaomi’s rapid growth is due to some key factors:
- High quality at a low price: Xiaomi sells its high performance and quality products as cheaply as possible and, increasingly, to as many people as possible worldwide.
- Innovation: Xiaomi back up their quality products with continuous innovation, right from their own Operating systems, to their advertising scheme.
- Advertising strategy: this is probably where Xiaomi has really made a huge difference, in fact, they spend little on advertising and use the money saved on improving their quality. They rely on word of mouth and social media hype to advertise their products for them. With frequent updates on social media, they manage to stay in touch constantly with Mi-fans.
- Loyalty program: being a Xiaomi VIP means getting points with each new purchase and as well as for discounts on future purchases. VIPs are also invited to special events.
- Diversification: Xiaomi created an ecosystem of some 100 startups as partners to provide Xiaomi with other Internet-connected home and tech products (such as rice cookers, smart watches, air purifiers, and the new Mi Home) that would draw customers to its stores.
The company has grown so fast in the past year that research firm Strategy Analytics says Xiaomi could overtake Huawei and Apple in the next year to become the world’s second-largest smartphone vendor, behind Samsung.
by Daniele Yang