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Infographic: As Xiaomi Starts to Expand, Does its Reputation Precede the Device?

June 14, 2014 - Written By Cory McNutt

As China’s homegrown smartphone, Xiaomi, begins to expand beyond its borders to several international markets in 2014, we have to wonder how the potential customers view Xiaomi in terms of quality.  China is known for many ‘white box’ devices – those designed somewhere else, but made in China because it is cheaper to do so or just “off-brands” built in China and shipped with no brand name…but can anything of real quality come out of China?  For so many years, “Made in China” was synonymous with cheap – however, those days are long gone…just take a look at the Lenovo (IBM) ThinkPad that I am using to write this article.

Another such company that is quickly gaining a good reputation is the new and exciting, Xiaomi.  Headquartered in Beijing and founded by CEO Lei Jun in just 2010, it has already become one of China’s biggest electronic manufacturers.  They released their first smartphone in 2011 and have already surpassed Apple as the number three smartphone in China, which is no small feat.  Xiaomi has been called China’s Apple and its founder and CEO Lei Jun has been compared to Steve Jobs with his likeness for blue jeans and dark shirts.  However, he compares Xiaomi more to Amazon – a company that sells through their website, hoping to make its money on all of the accessories and services a customer will buy along with their smartphone.

As Xiaomi begins the challenge of expanding beyond its safe borders, Jana – a company that specializes in gauging the public opinion in emerging nations – conducted a poll of 750 people in India, Indonesia, Philippines and Vietnam from May 2 -4, 2014.  They wanted to find out what their opinions were on Xiaomi, even though the product is not yet available in those countries.  In other words, how do they perceive the Xiaomi brand – when they hear it, do they think of quality, or when they think of quality, what China brands come to mind.  This study asked the participants three questions: How much will you pay for your next smartphone – Which of the following do you know as China’s highest quality smartphone – and lastly, Which brand do you associate with low-cost, high-quality smartphones…and the answers were very enlightening.

When asked – HOW MUCH WILL YOU PAY FOR YOUR NEXT SMARTPHONE – the answers were all over the place depending which of the four markets you looked at.  The customers from more advanced India were willing to pay more for their next smartphone – only 8-percent were going to pay less than $100, while 16-percent said that they would pay $101 – $150, and 28-percent said $151 – $200, while almost a third at 31-percent said they would pay $201-$400, and a full 17-percent said they would pay over $400 on their next smartphone.  Those percentages for the more expensive phones dropped off dramatically in the lesser developed nations, which makes sense since money is much tighter.  While a total of 48-percent in India would be willing to spend $201 – $400+ for their next smartphone, only 36-percent were in Vietnam, 29-percent in the Philippines, and only 17-percent in Indonesia were willing to spend that much. Xiaomi offers two devices that fall into the price range of the majority of respondents – the Xiaomi Redmi falls into the $101 – $150 category and the Xiaomi MI3, priced at $270, offers specs equivalent to devices costing $300 and over.

When asked – WHICH OF THE FOLLOWING DO YOU KNOW AS CHINA’S HIGHEST QUALITY SMARTPHONE – respondents from Vietnam ranked Xiaomi number one in quality and on par with the likes of LG (which is not a Chinese company), Oppo, Lenovo and Huawei.  Indonesia picked Xiaomi as third best, topped by Oppo and Lenovo, as did the Philippines topped by LG and Lenovo.  Reading this, we must keep in mind that Xiaomi smartphones have never been sold in any of these countries, yet three areas picked them in the top three of “China’s highest quality smartphone.”

When asked – WHICH BRAND DO YOU ASSOCIATE WITH LOW-COST, HIGH-QUALITY SMARTPHONES – Several participants mentioned Xiaomi and described them as: “Xiaomi phones are Chinese phones but of good quality” by a 20 year old male from India.  “Fake Apple from China” by an 18 year old female from Indonesia.  “Good smartphone with a neat exterior design” by a 27 year old male in Indonesia.  “Affordable and fashionable” said a 24 year old male from Vietnam, and “The quality is excellent and an affordable price” from a 23 year old male from the Philippines.

It is interesting to see just how much of an impact the name Xiaomi has made in such as short time frame, especially in countries that do not even sell the product. If Xiaomi does a little advertising and promotion, their name and reputation may spread like a wildfire. According to Hugo Barra, Xiaomi will make its U.S. debut sometime in 2015 and I know I am excited to see what they bring to the U.S. market. Please let us know on our Google+ Page if you are interested in the Xiaomi brand – or have you even heard about it – what is your perception of their quality and value…as always, we would love to hear from you.