Xiaomis International Venturing

Question: Describe about the Xiaomi's International Venturing. Answer: Introduction Xiaomi Inc. is a Chinese electronics company, dealing in designing, developing and sale of smartphones, mobile apps, and other related consumer electronics. In the year 2015, Xiaomi had a global market share of about 5% and surveyed as 5th largest smartphone maker company in the world. Xiaomi employs about 8,000 employees in Mainland China, Singapore, and Malaysia. The company is working out strategically to expand its business to other countries like India, the Philippines, Brazil, and Indonesia (Culpan, 2015). Any company that is planning to enter the international market prefers to analyse the market factors of that country and then decides the best mode of its entry into the market to leave a positive impact on the company. Xiaomi has also entered the Indian market after a proper survey. It has started doing its business in India on July 15th, 2015. It entered the Indian market the exclusive sales tie-up with Flipkart. This turned out to be a very successful venture for both Xiaomi and Flipkart as they sold around 1, 00,000 sets in just seven days of launch. After about eight months of exclusive sale of Xiaomi products on Flipkart, Xiaomi entered into partnership with Amazon and Snap deal. With it, they started selling their accessories in Airtel Stores and Mobile stores. Once the company marked its share in the smartphone market, it launched its own Xiaomi Mi online app store which now sells the Xiaomi products and accessories (Dou, 2016). This way Xiaomi entered the Indian market through a joint venture and later on, creating its own e-commerce brand outlet to sell its products and accessories. Findings There are many factors that come into a challenge for a company to set its business in a market. They can be controllable or uncontrollable factors. Any marketing strategy of a company revolves around these factors (Ganesh, 2016). Controllable Factors The analyses of two controllable factors for Xiaomi in the global market are as follows:- Product- Xiaomi have always believed in providing the best quality product at low prices, which has helped such new company to become one of the largest smartphone selling companies so quickly. It is famous for China made product that if they cost low, then their quality will also be low, but not in a case of Xiaomi. Xiaomi has kept its phone prices lower than its biggest competitors Samsung and Apple. Xiaomis strategy to rule the global market if to provide good quality phone at lower prices. The Smartphone launched by the company includes a high-resolution screen, reasonable battery, good quality, robust case and runs on the Android-based operating system called MIUI. With the option of customization, it has more special features than any other Android Smartphone available in the market within the price range. Its software is the key to success rather than its hardware (Mahapatra, Mohanty, and Patajoshi, 2015). Price- Xiaomis market strategy for another market factor that is pricing is to sell the product at a lower price to gain tomorrow. Xiaomi has used the method of e-commerce for selling its products in the global market by getting into exclusive tie-ups with online products selling portals like Flipkart, and Amazon. This method of selling products reduces the cost of opening stores, inventory keeping, hiring staff, and various other miscellaneous expenses. This allows Xiaomi to sell its phones at a price which help only to cover the device cost rather the cost of production, and this strategy is not a sustainable strategy for a long term. Xiaomi will sell its phone at a lower price today to earn profit from other contents like services, accessories, and application. This will help the company earn the profit for themselves (Pandurangarao, 2015). Uncontrollable Factors The analyses of two uncontrollable factors for Xiaomi in the global market are as follows:- Economical- People nowadays prefer to purchase the maximum amount of operations at a minimum amount of price. Xiaomi offers the same kind of offer to the public. In India the most demanded segment of smart phones lies between five thousand rupees to twenty-five thousand rupees. The person who is purchasing the phone costing five thousand will want all the features that a twenty-five thousand rupees worth smart phone has, which is a major challenge for a company to fulfill. It is important for the company to have a tie-up with the local networking and software operators which is going to help the company in further reduction of the costing of the product (Seo and Kim, 2016). Technological- Nowadays the usage of the internet has become an important part of a persons life. It is estimated mated that more than 70% people will start using internet by 2017. Therefore being technologically advance is a necessity for the company to have its feet secured in the current market scenario which demands new and advanced technology. All the phone companies are coming up with upgraded software to promote their brand. Xiaomis future profits depend on the strategy of up gradation of applications and software thus; it becomes necessary for them to use technology in their favour (Tanz, 2016). Visuals of Mind Map of Xiaomi Recommendations Conclusion Xiaomi can localise the content and software to reduce costing Xiaomi needs to identify the weaknesses of local competitors Serve and educate the new segments of smart phone users Xiaomi needs to develop long-term on-ground capabilities (Yang, Park, and Lim, 2015). Xiaomi is a company that has in very short time created a solid position for itself in the home market and now developing strategies to enter the global market to further increase its business. Xiaomi prefers to take the different set of strategies to enter in a market from which the rivals are using. This gives the company a different identity, reduced costing as well as creates awareness amongst the consumers. Hence, I conclude that, Xiaomi is at present taking right steps to introduce itself in the global market and need to follow the new approaches as it comes in front of the company to continue its success path (Culpan, 2015). References Culpan, T. (2015).Xiaomi's $45 Billion Valuation Seen `Unfeasible' as Growth Cools. Dou, E. (2016).Rivals Try to Reinvent Xiaomi Business Model. Ganesh, V. (2016).Xiaomi charts out strategy for India operations. Mahapatra, D., Mohanty, A. and Patajoshi, A. (2015). India's Online Business Restructuring: A Case Study of Flipkart. Seo, J. and Kim, I. (2016). An Exploratory Study on the Sources of Competitive Advantage of XIAOMI and Its Limitations. Tanz, J. (2016).Xiaomis Smart Strategy to Design Phones for Everyone. [online] WIRED.