Individual Case Study Report (For Xiaomi Corporation)
Assessment 2 PART A MGF5961 S1-2020 ASSESSMENT VERSION: ASSESSMENT 2 PART A NAME: VISHAL KAMLESH PATEL STUDENT ID: 30321999 SEMINAR DAY & TIME: THURSDAY, 09:00 HRS Page 1 Xiaomi Corporation, headquartered in Beijing is a Chinese consumer electronics company founded in April 2010. On July 9, 2018, It was listed on the ‘Hong Kong Stock Exchange’ Main Board. Xiaomi’s vision and commitment is towards building a better life in the world through developing innovative technology at honest prices with a steady focus on quality and efficiency (Mi Global Home, 2020). The company mostly leads its business through four segments, namely - Smartphones, Internet of Things & in-house lifestyle ecosystem products which includes smart TV/smart set-top, network routers, laptops, smart webcam, robotic vacuum, etc, The provision of internet services, and finally, Investment business. As of now, Xiaomi distributes its products domestically and internationally in more than 90 countries around the globe with a main solid footing in numerous business sectors. Xiaomi is at present the world's fourth-biggest cell phone brand, and has set up the world's biggest shopper IoT stage, with more than 213.2 million shrewd gadgets (barring cell phones and PCs) associated with its foundation. Xiaomi’s core product comes from its popular smartphones segment. Xiaomi produces smartphones in various categories of MI series. Where “MI” stands for ‘Mobile Internet’ or interpreted as ‘Mission Impossible' because the company believes it has achieved some remarkable feats as a young startup. The different range of smartphone series Xiaomi offers are Mi Series, Mi Note Series, Mi Max Series, Mi Mix Series and Redmi Series. Out of which ‘Redmi’ smartphone has been the company’s core flagship product. Redmi phones utilise the Xiaomi MIUI user interface on Android. The most huge contrast in Redmi from other Xiaomi smartphones is that it utilises more affordable components and in this manner have lower costs while holding higher specs. Xiaomi focuses on the youngsters in quickly developing middle class who try to purchase items close to top brands at a reasonable cost and constantly desires to have up-to-date experience by tweaking their phones to the most newest features. This gathering turned into Xiaomi's huge client base that filled its development. They became an asset as well as energetic sales reps for Xiaomi, promoting their products to loved ones for nothing. Xiaomi suppliers include Sharp, Foxconn, and Wintek one of the world’s most profoundly touted hardware manufacturers. Xiaomi’s demand-driven strict manufacturing policy is backed by its ecosystem of suppliers and reliable manufacturing partners, designed to keep the inventory and up-front production costs as low as it could reasonably be expected. Xiaomi costs the phone nearly at bill-of-material costs, without compromising the component quality and performance compared with other premium cell phones by keeping its products in the market longer, eighteen months instead of the half year standard followed by numerous cell phone brands (Treadgold, Alan; Reynolds, Jonathan, 2016). Page 2 In order to create customer value the main determinants are product quality, service quality and price which are measured on the value dimensions of Reliability, Assurance, Responsiveness, Tangibles, Empathy. A company uses any one of the determinant strategy or all of three determinants simultaneously to deliver breakthrough customer value. Mobile phone ventures have been seeing a fast development and especially in this last decade that have seen mobile phones getting more smarter and stylish than its initial days when the idea of having a mobile phone was absolutely misjudged by the majority. The long established brands such as Apple & Samsung and the home grown Chinese rivals like Oppo & Huawei are there, it was very difficult for Xiaomi to make an entry in the market. For which Xiaomi decided to use Product quality, Service quality and a Low-price approach to create its customer value. This strategy of winning combinations of product and service benefits and price emerged from a precise evaluation of the target market’s needs and desires (outside-in approach) (Duchessi, 2002). Xiaomi first centered around making a functioning mobile phone community called "MI Talk", in which individuals could examine their user experience, how to tweak their android system, and what capacities they truly need in their next smart phone. A half year after the community was propelled, there were more than 3 million active users in the network. Once enough customer feedback was generated, Xiaomi built up a specialised group to profoundly redo the Android framework, and distribute its improved portable working framework as MIUI on line. Thus, building on trust & reliability amongst its users by being responsive to their expectations. In the first month itself, more than 300 thousand customers downloaded MIUI. Four months later, Xiaomi officially launched its smartphone series “Redmi”. Thus, assuring customers of quality product at low price by demonstrating true knowledge and dependance. Xiaomi exclusively sells most of the Redmi smartphones on virtual stores i.e. on the internet through its famous limited availability online flash sales. It helps Xiaomi to ensure that supply never outstrips demand and promote its products heavily on social media. Apart from this Xiaomi keeps ‘Mi Fan Festivals’ which proved to be the correct way for the company as nurturing of the fan community meant more customer retention and loyalty. Also, “Orange Fridays” are weekly releases of developer software updates where Mi fans get an opportunity of dialogue with the company and can provide suggestions or feedback, thus, showing empathy towards customers. Page 3 References: • Mi.com. 2020. Mi Global Home. [online] Available at:
. • Treadgold, Alan; Reynolds, Jonathan (2016). Navigating the New Retail Landscape: A Guide for Business Leaders. Oxford: Oxford University Press. p. 128. • Duchessi, P., 2002. Crafting Customer Value. West Lafayette, IN: Purdue University Press, pp.81-91. Page 4