Can Xiaomi Repeat Its Smartphone Success Story With Its Televisions?
Xiaomi has consistently tasted success and hit the right chords by offering premium features at extremely affordable prices.
Xiaomi came to India in 2014 as a small smartphone company, offering quality smartphones at affordable prices. Since then, things have radically changed and today, Xiaomi rules the Indian smartphone market. But one thing that hasn’t changed is the affordable prices.
Xiaomi has come a long way from four years ago. Now the Chinese company wants to repeat the same success story with its televisions. The number one smartphone brand in India recently launched three televisions within a span of three weeks, and now targets to be the number one television brand in India by March 2019.
To start with, Xiaomi has got all the basics right. It’s now an established brand in India, has a ready market and most importantly it has a lot of value to offer, with very aggressive pricing. All the three Xiaomi televisions have one thing in common, they feature top-end specifications at a pocket-friendly price, as much as half that of the top three television brands in India – LG, Samsung and Sony.
The Strategy Of Disruptive Pricing
India is a price-sensitive country. Xiaomi has consistently tasted success and hit the right chords by offering premium features at extremely affordable prices. It took the market by storm after launching their smart televisions at such disruptive price points, a strategy which has served them extremely well in the smartphone market.
The company is selling the televisions at throwaway prices and is looking to shake-up the pricing strategy in the Indian television market. Exactly like Reliance Jio did in the Indian telecom space.
Xiaomi’s 3 Smart TVs; 32-inch, 43-inch and 55-inch
Xiaomi’s 32-inch TV vs. LG/Samsung/Sony
The 32-inch Mi TV 4A costs Rs 13,999/-. The prices for the other 32 inch televisions from these top TV companies start at Rs 24,000/- with similar specifications. Xiaomi has a clear price advantage here. But the others are well-established brands with years of expertise and an extensive service network.
But again, the 32-inch Mi TV 4A offers excellent features and unbeatable value for money for first-time smart TV buyers.
Xiaomi’s 43-inch TV vs. LG/Samsung/Sony
The 43-inch Mi TV 4A is available for Rs 22,999/-. Whereas the prices for other 43-inch televisions from the top companies start at Rs 36,000/- with a similar set of specifications. Things are not so clear-cut here. Xiaomi’s 43-inch Mi TV 4A has only full HD resolution. Other brands at least offer the option of 4K resolution in the same screen size, albeit at higher prices.
Typically, buyers like to have choices when it comes to buying bigger-sized TVs.
Xiaomi’s 55-inch TV vs. LG/Samsung/Sony
Specifications-wise, this is the best Xiaomi is currently offering. The 55-inch Mi TV 4 is available at Rs 39,999/-. The prices of the other 55-inch televisions from these top companies start around Rs 75,000/- with a similar set of features and specifications.
This is where Xiaomi has a clear advantage over the others. The 55-inch 4K LED display can stand up to the others quite easily. Xiaomi says this is the thinnest smart TV in the word. The extremely thin form-factor and its piano finish certainly give it a premium look that belies its price.
The Potential Downfall: Flash Sales & Low Supplies
Xiaomi is applying its smartphone strategy to its televisions by maintaining low inventories and focussing on flash sales. The company is known to create a buzz by making consumers anxiously wait for its products. This is one of the primary reasons that Xiaomi’s products always seem to be in demand.
The company plans to start selling its televisions in their Mi Home stores soon, but there too, the supplies will be limited. This is one Achille’s heel plaguing all Xiaomi’s in-demand products. People are growing tired of jumping through the proverbial hoops just so they can buy these products. Even OnePlus did away with their elitist invitation system and people thanked them for it.
It seems Xiaomi is never in control of their supply and this has turned many people away from the brand.
Xiaomi is clearly focusing on the price-conscious consumers’ segment and soon will also eat into the share of smaller television brands like Vu, Kodak, BPL, Micromax and others. Till now, the market of the big three was not affected by the other low-priced models from small brands. But the market dynamics may soon change with Xiaomi’s new models.
For the time being, Xiaomi will follow the flash sales model for selling its televisions, offering 4,000 to 5,000 units per sale. If Xiaomi can successfully keep up the pace with the demand, it can achieve its target of becoming the largest television brand online by March 2019.
Amidst the rising competition, the big players seem to be ready for Xiaomi’s challenge. At the same time, smaller TV brands are planning similarly priced models to compete against Xiaomi. Kodak has already launched a cheaper 50-inch 4K Android TV at Rs 34,999/-.
Smart TVs is going to be the next battleground for the pricing war. Xiaomi may successfully change the dynamics of Indian Television market, as it is difficult for other companies to match Xiaomi’s aggressive pricing strategy. But, the other companies have the advantage of robust, well-established service networks, where Xiaomi is a total newbie in this industry. It may take time, but Xiaomi has to ensure that it creates their own extensive service network if it wants to retain its customers. After all, a good customer experience doesn’t just stop at the sale.