Xiaomi faces test in Taiwan
November 28, 2013 Category Uncategorized
Xiaomi Technology, the Chinese maker of cheap iPhone lookalikes that is reaching offshore for the first time, will find it tougher to establish a customer base in Taiwan than at home, analysts say. Beijing-based Xiaomi, founded just three years ago, has become China’s fifth-most popular smartphone brand, with 7.19 million units sold last year. It began selling its handsets in Taiwan about six months ago. Taiwanese customers will be harder to please as they normally stick with older, trusted brands, consumer electronics analysts say. Some look down on mainland products because of perceptions of poor quality and Xiaomi’s fate in Taiwan is expected to offer clues about how well the brand might sell in other offshore markets. “I think there’s some audience that’s interested in Xiaomi’s offering, but definitely that group is not as big as the same audience in China,” said C.K. Lu, Smartphone Analyst with market researcher Gartner. “In Taiwan, brand is the concern, and not everyone knows Xiaomi, or it’s not the brand everyone trusts.” Its Android smartphones, which sell for as little as USD320 on the mainland, eating into the market share of rivals Lenovo and ZTE, would attract cost-conscious Taiwanese consumers who liked to customize their phones, Lu said. Analysts expect Xiaomi will build up a following among poorer Taiwanese and eventually in emerging markets beyond Greater China but to receive less enthusiasm elsewhere. “Xiaomi has limited distribution channels outside China, its smartphone designs are not yet significantly different from most other Android competitors, and the Xiaomi brand is hard for Western consumers to pronounce, spell or remember,” said Neil Mawston, Wireless Device Executive Director at Strategy Analytics in Britain. Xiaomi has been offering phones through Taiwan’s No 3 mobile carrier, Far EasTone Telecommunications, which gives them out free of charge with new service accounts. Far EasTone would not disclose figures for Xiaomi, but a company publicist called sales “feverish”. Chinese media say Xiaomi has targeted Brazil, India and Russia for future sales growth.
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