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A company started just eight years ago has now become
one of the world's largest smartphone makers.
I'm talking about Xiaomi. It's opening stores and now rapidly expanding outside of China.
So what's behind the growth of this massive Chinese tech company?
Xiaomi is the fourth-biggest smartphone player in the world.
It's India's top-selling smartphone brand and one of China's top players.
But its breadth is much more than that.
It's present in 74 markets around the globe,
with nearly 15,000 employees
and more than 300 million people
are using its products or services.
While Xiaomi may be a foe for Apple, it's
somewhat of a friend to Google and Microsoft.
Xiaomi smartphones run a version
of Google's Android operating system
and the Chinese tech company is partnering
with Microsoft to collaborate on artificial intelligence.
The company makes about 72% of its revenue
from China, and 28% from the rest of the world.
Xiaomi generates most of its revenues from
smartphones, but it's also expanded into
other products like music
and video streaming, too.
The Beijing-based company wants its smartphones to be just the start
of an entire device ecosystem for its users.
Which may explain why it's sometimes referred to as the “Apple of China.”
When the company was first started, Xiaomi only sold its products online
in an effort to reduce overhead costs.
It avoided spending money on advertising
and relied on brand loyal customers to spread the word.
Xiaomi's selling point was simple.
Offer high-quality devices, but at lower prices than competitors.
And it worked.
Xiaomi became China's number one smartphone in 2014.
But the success was short-lived.
Sales fell in 2016, pushing Xiaomi down several spots to number five in China.
New low-cost players were entering the market, and the company learned that by selling its
phones online directly to consumers, well, it made it difficult to reach new customers,
like those in China's smaller cities.
So Xiaomi began to change up its strategy.
Recently it's been getting into the brick-and-mortar game,
opening a large number of stores like this one in Hong Kong.
It plans to open 2,000 stores worldwide by 2019 with just about half of them in China.
It's expanding its footprint outside of China, opening retail stores in Spain and Italy
and forming retail partnerships here in the U.K.
And while Xiaomi isn't in the U.S. yet,
Xiaomi's head of its international business says they do have plans to enter the market.
It's not just a smartphone business.
Xiaomi also makes things like smart watches, headphones, speakers, pillows,
VR headsets, air purifiers, rice cookers, kitchenware, luggage, hats and wallets.
That's on top of selling online content, entertainment and financial services.
In 2017, Xiaomi's sales grew more
than 67% from the year prior,
leading some to call it 'China's Phoenix.'
Product launch events for its new products can draw up to thousands of fans.
And while companies like Samsung have used
Kanye West and Bruno Mars to pump up fans for new products,
Xiaomi events are usually headlined by well, the company's CEO Lei Jun.
As one of Xiaomi's co-founders, he has a net worth of more than 12 billion dollars.
He worked in technology and as an angel investor before starting the company in 2010.
So what's next?
Smartphone shipments in China suffered their largest decline ever in the first quarter of 2018.
And global smartphone sales declined last year for the first time since 2009.
While the industry news is concerning for massive smartphone players,
Xiaomi actually had an 88% increase in the number of phones
they sold globally in the first quarter of this year.
That's compared to a slight decrease by Samsung and slight increase by Apple.
Xiaomi's growth was largely because of its previous ho-hum performance though.
So the question remains.
Will “China's Phoenix,” so dependent on its hardware business, fly to new heights?
Or will it return to the ashes?
Hey, guys, it's Uptin. Thanks for watching.
For more of our videos check out 'The rise of the Chinese smartphone' here
and my day at Huawei's campus in China here.
We're also taking suggestions for future CNBC Explains, so leave your comments in the section below
and while you're at it, subscribe to our channel.
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什麼是小米? (What is Xiaomi? | CNBC Explains)

686 分類 收藏
Samuel 發佈於 2018 年 7 月 3 日    Judy Huang 翻譯    Samuel 審核
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