How BBK Electronics is countering Xiaomi in India

  • Realme has been a product-focused company since inception and listens to its users. Instead of spending heavily on marketing, the brand and its employees directly reach out to the user via social media, events, and meetups. It lets the product do a majority of the talking.
  • The brand has been quick to roll out fixes and improvements and just recently announced opening up of bootloaders for a wide range of devices. It has also been reaching out to developers to improve its software and indirectly encouraging the XDA community to support Realme. All these points ultimately provide the user with more options and improve confidence.
  • Though the brand has been limited to the affordable segment and shows no sign of breaching the Rs 20,000 mark. That being said, almost all the products it has in the price segment have very strong specifications something Xiaomi has been known for.
  • OnePlus started out as an affordable brand, but smartly kept on increasing the price and within no time, it transformed into a “premium” player. To justify the price rise, it had some unique technology offerings like Dash Charge (now Warp Charge), this was something completely unheard of a couple of years back and every other brand was scrambling to offer a similar solution. Secondly, it understood that Android wasn’t as responsive an OS as iOS when it started so it worked with CyanogenMod in its early days and then developed Oxygen OS as Android user experience which is now known to be even better than stock Android.
  • All this while, Xiaomi did try to enter the Rs 30,000+ space but failed time and time again. The Mi-series never took off in the beginning due to basic shortcomings like lack of 4G on the Mi 4, buggy UI, and illogical memory configurations on the Mi 5. It later tried with the MIX series, but sales failed to take-off. So much so, that aside from the Android One based Mi series of smartphones, Xiaomi has pulled its Mi branding in India from phones and reserved it for other products like TVs. Xiaomi was a victim of its own success as it became the Maruti of smartphones in India and struggled to move upwards in the food chain as its branding prevented it from being a maker of premium consumer electronics. In part because of its branding and mass-market image and in part because of product stumbles and lack of differentiation at the high end, Xiaomi has struggled to operate in the high margin premium segment of the market.
  • Both stuck to one segment and understood the buyer. Realme portrays itself as a young brand that’s leading a rebellion. Its user base comprises of college students who are on a strict budget. While OnePlus is a premium brand that’s built for those who get things done in the boardroom. Their marketing is also adjusted accordingly and it’s no surprise to see Rober Downey Jr become OnePlus’ brand ambassador.
  • The two also know how to build a brand. On one side we have OnePlus organising a music festival with leading artists like Katy Perry and Dua lipa, and on the other, we have Realme, who’s sponsoring college fests with popular stars like Guru Randhawa and Divine as a part of its Sundowner’s.
  • And lastly, both of them are product companies. Investing more in the phones, than marketing. With a long-term outlook, they aren’t making the same mistakes that OPPO and Vivo did.
  • Xiaomi is finding it difficult to breach the 30% mark because the market is very saturated and there are a lot of other players like Samsung, LG, Asus, Nokia, Moto, Honor, Huawei, Meizu, Vivo, OnePlus, Realme and OPPO involved. Despite so many brands, Xiaomi managed market leadership pushing 30% of market share. And almost all of this was achieved at the sub Rs 30,000 segment of the market. This means while Xiaomi has a lot of users, but none of them is high paying customers. Xiaomi has very low margins and it has almost saturated its growth in the sub Rs 30,000 segment of the market. That’s why Xiaomi is aggressively expanding to other product categories like TVs and smart homes to fuel its growth in India because it knows unless it starts selling expensive smartphones, it wouldn’t have a lot of room for growth in India with phones.

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warpcore

Serving communities on the intersection of technology, indie music and culture, the warp core is a think tank founded by technology journalist Sahil Mohan Gupta