Amazon not only sold $2.5 billion worth of goods, it introduced Prime members to new services. How should rivals compete in 2017?
Xiaomi, which hired Google’s Android chief last year, is targeting six Asian countries plus Russia, Turkey, Brazil and Mexico.
Xiaomi Inc. dropped a broad hint last summer that it planned to expand beyond China when it hired Hugo Barra, Google Inc.’s head of product management for its Android mobile operating software. Now the Beijing-based company has outlined its program for selling directly to online shoppers in other countries.
After testing the international market in Hong Kong, Taiwan and Singapore in the past year, Xiaomi has announced plans to expand online sales in 10 countries, six in Asia and two each in Europe and Latin America. While the United States is not on the list, it is on the roadmap for Xiaomi, which designs its own brands of smartphones and web-connected TVs.
“This year we plan to expand into 10 countries and market via the cross-border e-retail model, and we have spent $3.6 million to acquire a short domain name, mi.com, to promote our brand globally,” Xiaomi founder and CEO Lei Jun told followers on the Weibo social network, China’s equivalent of Twitter. “We will enter U.S market in the future, but now we still need more time to prepare for that day.”
At mi.com, a consumer can select her country and go to sections of the site localized for her language and currency. There are currently four sub-domains that offer products for sale: for consumers in mainland China, Taiwan, Hong Kong and Singapore. “MI” is commonly used in China to mean mobile Internet. The word “xiao” means small in Chinese.
The “cross-border model” Lei refers to means Xiaomi plans to ship products from China, rather than building fulfillment centers in the markets where it will sell.
The countries Xiaomi plans to sell to this year are:
Asia: Malaysia, India, Indonesia, Thailand, the Philippines and Vietnam.
Europe: Russia and Turkey.
Latin America: Brazil and Mexico.
Xiaomi says it will introduce products tailored to the new markets it is entering.
Founded in 2010, Xiaomi’s web sales grew 134.5% in 2013, when its sales surpassed the sales of Amazon China, according to the Internet retailer China 500, which ranks Chinese retailers by their online sales. Xiaomi ranks No. 3 in the China 500, with web sales that reached $4.8 billion in 2013. Amazon China ranks No. 4.
Analysts say Xiaomi has succeeded by turning consumers into fans and encouraging fans to promote Xioami through social media. For example, Xiaomi’s product managers are famous for closely following users’ feedback on Xiaomi.com and making quick adjustments to products as a result. Xiaomi products are built by Foxconn, a major consumer electronics contract manufacturer that also makes Apple Inc.’s iPhone.
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