Author(s): Raghu Gopal
Xiaomi's star burned bright early on. About three years after it began selling smartphones, the Chinese phone-maker became a top-five brand, coming to market with solid, affordable devices and flash sales that caused online stampedes. Products sometimes sold out in seconds, and scarcity — perhaps artificial and engineered — became a powerful brand-building tool. The world was Xiaomi's oyster. But in 2016, it seemed possible that its appeal was fading, as momentum turned toward even younger Chinese brands.
That was last year. During the past few quarters, Xiaomi has shown that it has its groove back, with sales at record levels and its ambitions of being a global smartphone brand back on track. Shipments in the third quarter of 2017 are estimated at 28 million smartphones, making Xiaomi once again the fifth-biggest smartphone maker in the world. The company recently revealed that it sold more than 10 million phones a month in September and October, and we expect it to continue to do so for the rest of 2017.
Yesterday, Xiaomi hosted its Change the Game event in Madrid to celebrate its launch into Western Europe. At the event, which was live-streamed on YouTube, the company's senior vice president, Wang Xiang, took to the stage to formally introduce Xiaomi and its Android products for the Spanish market.
This is Xiaomi's first official foray into Western Europe, and if the market likes what the company is selling, Spain will be a springboard for its greater European ambitions. The country is Xiaomi's third major market, joining China and India.
The Chinese company quickly became a top brand in its home market by selling devices that appeared to mimic some flagship phones being sold, but at a fraction of the price. Xiaomi's global expansion moves began with its arrival in India late in 2014, a successful debut by all accounts. It learned to adjust to the local market by partnering with major online retailers and then opening its own Mi Home stores, which propelled the brand's popularity.
Spain is a good starting point for Xiaomi in Europe. Over 80 percent of smartphone sales in the country are Android devices, the majority are sold unlocked and outside of operator channels, and there's strong demand for inexpensive phones.
A range of products will be available in Spain from today. Consumers will be able to buy phones and accessories from Xiaomi's site as well as through several other channels including Amazon, MediaMarkt, Phone House and Carrefour — all providing Xiaomi with a strong presence. Phones on sale include the Mi Mix 2, a sleek device with slim bezels, along with the Mi 6 and Mi A1. The lower-end Redmi series will also be available. The move will enable Xiaomi to take part of the market's entry- and mid-level smartphone sales and even challenge some flagship devices. The manufacturer will also release products such as its Mi Electric Scooter and Android TV Mi Box, building out an eclectic product portfolio.
For Xiaomi, this is the next step in its long-term expansion plans, which aim to transform the company from a self-described start-up, into a globally recognised brand. The scale of the Spanish launch shows it's serious about making it a success and not just dipping its toe in the water. Mr Xiang described Xiaomi's strategy well, saying the company won't bite off more than it can chew, and "In order to be focused, we want to make the Spain launch successful first. And then we can think of other markets and countries. We want to learn from the customers about the taste of European people". This is a wise approach. In the past, Xiaomi allowed its global ambitions to be a distraction. Now it has learned that taking small steps is the best approach.