They say if you are just imitating something, you cannot overtake it. However, it is not always the case in China. Xiaomi, a Chinese version of IPhone, is often condemned for imitating Apple’s product launches. According to Rosemary Westwood’s blog, Xiaomi has eclipsed Apple’s products sales in the Chinese market. Two years after launching its first phone, Xiaomi accounts for 5% of smartphone sales comparing to that of Apple (4.8%).
Price has always been a potent factor that contributes to huge sales of Xiaomi’s products. The price of a Xiaomi smartphone is $285. Given the average salary in Beijing is around $870, clearly Xiaomi has a its price as a competitive advantage comparing to IPhone 5s’s price as high as $757. Indeed, Xiaomi’s sale’s strategy is actually the antithesis of Apple—partly the secret of its success. Apple earn fat margins off hardware and services, while Xiaomi is almost selling its phones at cost, according to Iris Mansour.
A larger sales volume does not guarantee a larger profit. Apple still beat Xiaomi in terms of profit gained. And the questions come to me is, although Xiaomi has beat Apple in China, can it win over the rest of the world by using the same strategy?
Reference:
http://www2.macleans.ca/2013/09/26/chinas-apple-clone/
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