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The competition with the regular army has just begun.

Text/Daily Financial Report Yu Xiaoyu

It's not that Apple is unaffordable, but Xiaomi is more cost-effective. It's not that Porsche is unaffordable, but Xiaomi is more cost-effective. In the eyes of the outside world, Xiaomi has become the benchmark for cost-effectiveness. Is Xiaomi really so popular?

In 2011, the first Xiaomi mobile phone was launched. At the same time, the domestic smartphone market was surging. This year was a watershed in the mobile phone market. In addition to Apple, which shocked both China and foreign countries at that time, Huawei, Xiaomi, OPPO, and vivo all began to exert their strength in the smartphone market. It was also at this time that Lei Jun, the founder of Xiaomi, was given the title of "Lei Jun".

After 14 years of development, Xiaomi and many other brands have successfully eliminated many unknown brands and some old brands, becoming the top five in terms of shipments in the domestic market. After gaining a foothold in the mobile phone market, Lei Jun began to gradually move towards multiple brands, and the Xiaomi ecological chain in smart home appliances became the next step for Xiaomi.

Today, Lei Jun sees the market prospects of new energy vehicles. In 2024, the 10,000th mass-produced vehicle of Xiaomi will officially roll off the assembly line. On July 26, Lei Jun announced on Weibo that Xiaomi SU7 has been on the market for more than three months and has delivered more than 30,000 units, setting a new industry record. At present, the capacity increase has been completed, and the annual delivery target of 100,000 units is expected to be completed in November! The outside world no longer calls Lei Jun "Lei Busi", but "the god of marketing."

It took Xiaomi two years to achieve revenue from zero to over 10 billion, seven years to break through 100 billion, and in the eighth year it entered the Fortune Global 500. Even in 2020 and 2021 under the epidemic, it still achieved rapid growth, especially in 2021, with revenue of 328.3 billion, ranking 266th on the Fortune Global 500, becoming the fastest growing technology company in the world at that time.

From Lei Jun to the God of Marketing, Xiaomi's Business Secrets

In the wave of rapid technological evolution, Xiaomi has set off a revolution in the global market with its unique marketing philosophy and performance growth. From smartphones to smart cars, every step of Xiaomi seems so precise.

In the first quarter of 2024, Xiaomi Group delivered an impressive report card: revenue reached 75.5 billion yuan, a year-on-year increase of 27%; adjusted net profit reached 6.5 billion yuan, a year-on-year increase of 100.8%. In the global smartphone market, Xiaomi ranked among the top three with a shipment volume of 40.6 million units, and its market share reached 13.8%.

According to the latest report released by Counterpoint, in the global smartphone market sales rankings in the second quarter of 2024, only one Xiaomi phone made the top 10 list, and the others were all Apple and Samsung products.

The success of Xiaomi smartphones is due to its cost-effective product strategy and precise market positioning. Driven by the high-end strategy, Xiaomi has not only established a firm foothold in the domestic market, but also achieved significant growth in emerging markets such as the Middle East and Latin America. The active user group of the MIUI community has become Xiaomi's most valuable asset. They are not only product users, but also loyal fans of brand communication.

Xiaomi's high cost-performance strategy has enabled it to quickly gain market share in the mid- and low-end markets. By comparing its products with those of its competitors, it has magnified its cost-performance ratio so that more consumers can understand it. By paying tribute to the technology and design of high-end brands, it has optimized its image in the minds of consumers and gained their recognition.

Xiaomi's achievements in IoT and consumer products are equally impressive. The smart home appliance business grew by more than 46% year-on-year, tablet shipments grew by 93% year-on-year, and TWS headsets ranked first in the Chinese mainland market and ranked second in the global market. Behind these achievements is Xiaomi's unremitting pursuit of innovation and deep insight into user needs.

The most noteworthy thing is Xiaomi's layout in the automotive field. At a time when traditional cars and new car-making forces are fighting fiercely for new energy vehicles, Xiaomi also announced its entry and successfully released the SU7 series. Since its release, the market response has been enthusiastic. As of April 30, 2024, the cumulative number of locked orders has reached 88,063. This figure not only shows the market potential of Xiaomi Automobile, but also indicates a bright future for Xiaomi in the field of smart cars.

The success of Xiaomi Auto seems to be no surprise to everyone. Xiaomi has extended its brand influence and loyal fan base accumulated in the smartphone field to the automotive market. This transfer of brand loyalty provides the basis for the market acceptance of Xiaomi Auto.

Xiaomi's marketing strategy has demonstrated its unique advantages in both the smartphone and automobile fields. In the smartphone market, Xiaomi has established its market position through strategies such as high cost performance, Internet thinking, fan economy and rapid iteration. In the automobile market, Xiaomi has successfully gained a share in the new energy vehicle field through strategies such as brand extension, innovative product features, integrated marketing communication, cross-border cooperation and user participation.

From smartphones to today’s automobiles, every leap forward is a new journey. And every new journey has been a success, and Xiaomi Group’s marketing methods and capabilities are beyond doubt.

Even I, who used to live in a fifth-tier city, couldn't help but buy Xiaomi mobile phones, Xiaomi home appliances and many other products because of Xiaomi's slogan "Born for Enthusiasts". In comparison, the quality of Xiaomi's mobile phones is not good, but other home appliances are guaranteed to be better than those of other brands.

Xiaomi has won the favor of consumers through its high cost-effectiveness, innovative design, smart connectivity and high-quality after-sales service. However, from the overall evaluation, the coordinated development of Xiaomi's quality and sales should be paid attention to.

Xiaomi's quality and sales

First of all, as a domestic mobile phone brand, Xiaomi's development this year has attracted much attention. As for the quality of Xiaomi products, some people think that Xiaomi products are cost-effective, while others think that Xiaomi products have quality problems.

We have seen some information on the Internet. For example, some people have said that there are problems with the Pengpai OS system of Xiaomi mobile phones, the system maintenance progress is not good, and it does not solve the pain points of users, and sometimes they will even be blacklisted. In addition, the MIUI system is also full of bugs, and the surprises brought by the update are far less than before the update. In addition, problems such as phone freezes, black screens, and restarts have also caused many Xiaomi users to quit the Mi circle.

There is also information about Xiaomi's high-end mobile phone products. For example, the Xiaomi 11 series mobile phones have motherboard problems, black screen and cannot boot. In the high-end market, the price-performance ratio that people value seems to be useless at this time. The price is too high, and the performance and configuration do not meet user expectations, which has caused dissatisfaction among many users.

The second is Xiaomi cars. Since they were launched, car owners and the media have frequently reported various quality problems, such as brake failure, high-speed assisted driving failure, insufficient battery life, slow charging, etc. These problems not only seriously affect the user's car buying experience, but also pose a threat to life.

According to media reports, in May, a car owner in Leiyang, Hunan, who had just bought his Xiaomi SU7 for less than a month, encountered a thrilling scene of brake failure. During the parking process, the car's brakes failed and lost the damping feeling. An alarm sounded inside the car, and the car screen displayed four abnormal messages, including "brake system failure", "automatic parking failure", and "uphill assist function abnormality".

Finally, there is the Xiaomi ecological chain. In terms of the current development of the domestic ecological chain, the Xiaomi ecological chain is relatively complete. However, some netizens have revealed that they have purchased products from the Xiaomi ecological chain and frequently encountered product quality problems during use. Among them, the ecological chain humidifier has a design defect, causing users to suffer from respiratory diseases during use.

The emergence and development of the ecological chain is to bring more convenience and happiness to the fast-paced life. However, due to the frequent quality problems of ecological chain products, they need to be replaced or re-purchased. How should users choose?

The competition with the regular army has just begun

On the mobile phone side, the domestic market has basically maintained the pattern of Xiaomi, Huawei, vivo and OPPO. These brands have formed a relatively stable market share with their strong R&D capabilities, brand influence and market penetration. As long as there are no major accidents, their position is difficult to shake. These companies not only continue to make breakthroughs in product innovation, but also continue to optimize market strategies and user services to consolidate and expand their market position.

However, in the automotive sector, the competition situation is more complex and changeable. The current competitive situation in the automotive market is fundamentally different from that in the mobile phone market. First of all, the entry threshold of the automotive industry is relatively high, requiring not only huge capital investment, but also long-term technology accumulation and brand building. This makes new entrants face greater challenges. Although Xiaomi has taken the first step with its advantages, the new energy market is currently surging. There are many bankrupt manufacturers. Last year, WM Motor, once one of the "Four Little Dragons" of new car-making forces, went bankrupt. Its national sales and service centers were closed one after another, and the after-sales service of 110,000 car owners became a problem. On July 28, Evergrande Smart Car was filed for bankruptcy reorganization, which once again put new energy vehicles at the forefront.

Secondly, consumer demand in the automobile market is more diversified. From economy to luxury, from traditional fuel vehicles to new energy vehicles, the competitive landscape in different market segments is different.

Although Xiaomi is trying to replicate its successful experience in the field of mobile phones and smart hardware in the automotive industry, the competition between Xiaomi and the regular army has just begun. This is not only a competition of technology and capital, but also a competition of innovation and user experience. While maintaining the high cost performance of its products, Xiaomi needs to conduct in-depth research and development in the intelligentization and electrification of automobiles to meet the growing market demand.

In addition, Xiaomi's competitors in the automotive field include not only traditional automakers, but also electric car brands such as Tesla, as well as many domestic and foreign companies dedicated to the research and development of new energy vehicles. These competitors have their own advantages in technology, brand, market, etc. If Xiaomi wants to gain a foothold in this field, it must work hard in product strength, technological innovation, brand building, etc.

In general, the competition between Xiaomi and regular players in the automotive field is an all-round competition. This not only tests Xiaomi's ability to integrate resources, but also tests its grasp of market trends and its deep understanding of consumer needs. Only by continuous innovation and continuous transcendence can Xiaomi gain a firm foothold in this competition and achieve its long-term development in the automotive field. The final result still needs to be verified by the market.

Daily Financial Report

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