why xiaomi is called apple of china

Xiaomi is called the “Apple Of China” as a compliment and also as an insult. Advertising accounts for 55% of the revenue in the segment, with Value added services accounting for the rest. The mobile OS aside, Xiaomi has developed a range of mobile apps which are extremely popular. In 2017, their self-operated Mi Home stores generated the second highest average sales per square meter amongst retail store chains globally. For example, in each of India, Indonesia and Russia, on our smartphones, our Mi Music app ranked number one in the music category, in terms of MAU in March 2018, our Mi Browser app ranked number two in the browser category and our Mi Video app ranked number two in the video category. After creating an image in its home, Xiaomi partnered up with Mobility, a wireless cell phone distributor, to sell its devices in countries like United States, United Kingdom, Australia, and New Zealand. Xiaomi is most famous for its flagship Android phone line called the MiPhone and its founder and CEO Lei Jun, an extroverted character who has been called "China's Steve Jobs." Xiaomi, which was founded by a group of 8 engineers and designers in April of 2010, is a Chinese internet company which manufactures smartphones and other electronics. MIUI has over 190M MAU which use it for 4.5 hours/day on average. Today, MiUI as it is known is the default OS that powers Xiaomi phones and is tightly integrated with their hardware. S&M, G&A and R&D are just a combined 7–9% of revenue, meaning that Xiaomi has a positive operating margin of 5% on its core business. “At this point, I would like to pledge to our existing and potential users: starting in 2018, Xiaomi’s hardware businesses’ overall net profit margin will not exceed 5% per year. Xiaomi’s MIUI is eerily, similar to iOS. In addition, there was a drop in smartphone sales in 2016, but Xiaomi has been able to turn that around in 2017, which is pretty impressive. Because of its strategy, Xiaomi has often been dubbed the "Apple of China." In the design category, Xiaomi shows no innovation. Their mission is to build amazing products with honest prices to let everyone in the world enjoy a better life through innovative technology. Xiaomi started off selling their phones via a direct online sales channel. So how much money did they make from this? Most people think that Xiaomi began by selling phones. To better answer this question, lets first understand Xiaomi. As one might guess given Xiaomi’s strategy discussed above, the hardware is pretty low margins. They make products for elites who would like to show them off. Xiaomi was founded only four years ago, in April 2010, by eight partners, including Jun Lei, CEO, and Bin Lin, President. Adding this back to their operating margins more than doubles the operating margin from 4.8% to 10.4%! So in China MIUI works with: (1) Xiaomi's own services, including contacts, calendar, SMS, notes, photo album, etc., very similar to Apple and Google services; and (2) Xiaomi's own app/content store called Mi Market. Xiaomi is often referred to the “Apple of China”. Just how accurate is that? Or maybe Xiaomi is just Xiaomi — a unique entity both in China and beyond. In my mind, Xiaomi is more than a smartphone company. It has made over 210 investments including the number one powerbank, electric scooter and air purifier companies globally, and they also own sizable stakes in gaming, virtual reality and IoT hardware companies. Lei is fast becoming one of China's most celebrated and famous entrepreneurs. Finally, entering the world of smartphones in the year 2011 with its Mi1 and Mi2 devices that Xiaomi offered at very cheap prices but with good specifications, it created a buzz around the nation. Growing exponentially throughout the year, Xiaomi finally entered India through the online shopping website Flipkart which helped them to distribute their devices nationwide. How do they monetize these services, you might wonder? The craze caught up with the people and started to drive them crazy about the software that Mi was providing. (TBD). Though Xiaomi makes most of its revenue from hardware, they don’t view themselves as just a hardware company, but rather as an innovation-driven internet company. And people actually did that, because it was faster and a better user experience than Android at the time. Xiaomi Apple of China and India – Xiaomi Corporation, a multi-billion dollar Chinese smartphone maker headquartered in Beijing, China. It’s worth discussing Xiaomi’s global ambitions, particularly as it has been of the more successful Chinese technology companies in going global. Additionally, they use their online channels to also help partners sell. Xiaomi is marketing Mi MIX as a concept device (like Apple … That’s why Xiaomi is most successful in places like China and India. But the philosophy of Apple and Xiaomi are very different. Lin was previously worked at Microsoft, before becoming VP of the Google China … Founded by serial entrepreneur Lei Jun in 2010 and headquartered in Beijing, Xiaomi announced its first smartphone in 2011. In fact, they’ve taken a pledge to never make more than 5% net margins from their hardware products. Xiaomi makes money from sales of its devices and services. Together, they have over 100M connected devices, making them the largest IoT platform in the world. Xiaomi is better known globally as China's answer to Apple Inc, an image that billionaire Lei Jun has fostered since he founded the company in 2011 by dressing in … Here are two reasons why the purchase of Xiaomi by Apple would make sense. Some say Xiaomi is China’s Apple. Introduction: Founded in early 2010 by Lei Jun (current CEO and owner) along with his 8 like-minded teammates, Xiaomi is treading forth to beat the … Why Xiaomi is killing its rivals in China Xiaomi's robust sales in China are also fueled by two other factors -- national pride and perceived price gouging by foreign companies. They view their as a source of users into their ecosystem which they hope to monetize via services. All rights reserved. The last bit left is to look at operating costs. Aggregate gross margins are at 13%. Later, in 2013, Xiaomi launched its smart TV followed by their new Mi3 and Mi4. How much money does Xiaomi make? 'Xiaomi is the Apple of China.' It also has a “cool factor” about it, and a very loyal fanbase. Essentially their philosophy is as follows: Each of these is worth going deeper into. Our answer is that users have always expected amazing products at honest prices. Their mission is … But in terms of its business strategy, it diverges from Apple quite a bit. The fever of Xiaomi has never left India since then, hence making it a sensation worldwide. One important point to note is while they do make a bulk of their revenue today from hardware, they sell the hardware as close to cost as possible. "Apple has the capability and resources to look at innovation from all different angles," Peng said. First, it would eliminate a competitor in the world’s largest and fast growing marke t, … These investments are generally passive equity stakes in companies that develop products related in some way to the Xiaomi ecosystem and include consumer goods companies, IoT companies, and so on. And let’s not forget about their investments — over 210 investments in a wide variety of companies the gains on which which have contributed to over half their operating profit. So there you have it. As Xiaomi continues to progress, we ask ourselves: what has remained constant in the ever- changing business world? They manage an ecosystem of over 90 companies which produce additional smart hardware and lifestyle products. Even the name, Xiaomi, is a nationalist reference. Xiaomi and MiUI have attracted a large fan base, who provide feedback and inform the future product development of the OS. During its initial launch, Xiaomi sold about 100,000 devices in mere 4.2 seconds. On being called the Apple of China The reason why Xiaomi is known as the Apple of China is because both companies are hugely innovative. Known as the 'Apple' of China, Xiaomi entered the Indian market on July 15 2014 with an exclusive sales tie-up with Flipkart for smartphone Mi 3. The beta OS is updated every week, and the avid fans provide feedback/feature requests and spot bugs which are often fixed by the next release the following week. One of the things that Apple and Samsung have in common is a fear of emerging super-brands from China, and none is more fearsome than Xiaomi. In 2015 and 2016, the gain on the investments were almost $2.5B RMB each, and in 2017 they were $6.4B RMB. It was in the last year of this decade when he finally decided to start up his firm which would produce custom ROMs for android devices initially, making them do things that they didn’t usually do. "Xiaomi is such a small company, they are mostly focused on user experience." At the beginning of its establishment, Xiaomi focused on technology, building good products, and focusing on user experience. On the smartphone side, for which they are most well-known, they are the fourth largest vendor in the world behind Samsung, Apple and Huawei. Xiaomi isn’t just another Chinese mobile company, it is the most valuable mobile company in China commonly referred to as the Apple of China.It successfully took Apple’s place in China by producing well designed, quality Android devices and took the low end market from Samsung by bringing the price even lower than expected. Xiaomi is like the Apple of China. If the net margin exceeds 5%, we will return the excess to our users.” — Xiaomi’s Chairman Lei Jun. The New York Times article In China, an Empire Built by Aping Apple is almost a year old, and it makes some debatable claims, but it shows a popular perception of Xiaomi in the States. Moreover, they copy the software UI too. They now have offline channels as well, but they’ve made sure too not reduce their efficiency while increasing accessibility. We are absolutely not Apple in China. Most of the Xiaomi phone design is not unique. Xiaomi’s “triathlon” business model combines three things — innovative hardware, new retail and internet services. Xiaomi is set to launch one of the most anticipated IPOs of the year in Hong Kong within the next few weeks, with numerous sources touting an expected valuation of $100 billion USD that would make it the biggest first-time listing anywhere in the world since 2014.. Lei Jun is the founder and CEo of a firm called Xiaomi which the Chinese media have nicknamed the “Apple of the East." However, an internet company with ~200M MAU isn’t really worth $80-100B by itself…, Curious about technology, economics, and business. In 2017, Xiaomi made over RMB30 billion globally (up over 200% from 2016) which represented almost 30% of their revenue. I see a lot of potential room for growth for Xiaomi globally. I went through their prospectus and below are some of the things that stood out on their business model, financials and strategy. While Apple does have a growing services business, it’s fair to say that the main way Apple makes its profits is through its hardware, which tend to have gross margins of 60%. On the services side, today they primarily make their money in China but have a sizable untapped user base in India and Indonesia as evident from the excerpt below which presents a good growth opportunity. A couple of years later, Xiaomi started facing patent sue for its designs and user interface which slowed down the company’s run towards the ultimate glory and making them accept that they grew way too fast than the others. It has entered over 70 countries and is the number one in India in terms of smartphone market share and among the top 5 smartphone companies in 15 countries. The Business Case for Supporting Low-Income Women. The Book Industry: The War That Never Was. In some ways, they view their phones and other hardware as a source of users¹ into the Xiaomi ecosystem, which they will then monetize through services (and also through investments in other companies which they allow into the ecosystem).
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