Xiaomi initially started as a software company founded in April 2010 by ex-Kingsoft CEO Lei Jun, creating a new custom ROM based on Google’s Android. MIUI, the ROM which the team created, ramp the technology and achieved a huge success which was ported to many devices.

Xiaomi team members

As of 2014 MIUI can be downloaded and installed to over 200 devices in both English and Chinese, even non developers can easily install MIUI to their phones using the MIUI Express APK. As of the end of 2013 Xiaomi had over 30 million MIUI users worldwide! Very impressive for such a young company! The founder and CEO, Jun Lei is supposed to be “the Steve Jobs of China”. The most interesting fact is that Xiaomi is also called the “Apple of China”.

Xiaomi expansion

In 2012, Xiaomi shipped a total of 7.2 million smartphones and in 2013 the number rose to 18.7 million. Also, in the first quarter of 2014, Xiaomi had shipped over 11million smartphones, which was more than they sold in the entire year 2012. Demand continued to increase because of its low price and high specification hardware embedded.

Xiaomi had continued its expansion out of China with the high-profile hiring of Hugo Barra (ex-Google android executive) whose job was to discover new markets for expansion. Sales had been started in the overseas countries like Malaysia, Philippines, India, Indonesia, Thailand, Vietnam, Russia, Turkey, Brazil and Mexico.

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Xiaomi is not limited to phones only

Xiaomi also deals in devices other than mobile phones. Smart TV, power banks, Wi-Fi router, tablets, band and cases are the items with which Xiaomi deal with. Xiaomi had shipped over 60 million units worldwide by the end of the year 2014.

Even with their huge international fan base and great popularity, it is to see if Xiaomi can stay in the competition and how much their marketing style will cut the mustard in more mature markets.

About Xiaomi – How Xiaomi became most valued startup across the world

Funding of $1.1 billion in December 2014 made Xiaomi most valuable startup across the world leaving Uber on number 2. The current valuation of Xiaomi is over $46 billion exceeding Uber by $6 billion.

Moving few years back and looking in 2011, Facebook was on top of the list with valuation of $50 billion, which was more than the current valuation of Xiaomi but Facebook went public since then and Xiaomi slid on to the first position in the privately-backed company category.


Lei carefully cultivated the image of Steve Jobs even in his outfit by wearing jeans and black shirts and was very much ambitious in creating his brand into one of the World’s Top 500 Best Companies.
Started steadily in the Chinese market on April 6, 2010, Xiaomi swiftly tightened its reach in the Chinese smartphone market and current scenario said that Xiaomi is the third largest smartphone maker in the whole world.

As mentioned earlier, the company that was founded just 5 years back in 2010 has overtaken the twin giants of mobile market Samsung and Apple in China. This all was made possible through its unique marketing strategy which involves offering cheap but high quality hardware embedded in the phones. It is expected that around 500 million smartphones will be sold only in China in the year 2015, which will be more than three times as many as will be sold in the United States.

Till date, the company has raised 6 round of funding for its expansion and product development plans. Xiaomi is now the third largest smartphone maker in the world followed by Lenovo and LG at fourth and fifth place respectively. Samsung and Apple hold the first and second positions respectively.

Why China is moving out of i-phones?

Here are the reasons why China is moving towards Xiaomi and i-phone is getting out from there. Xiaomi is top over other mobile brands in sales.

• Xiaomi users can send files to other smartphones using Bluetooth while Apple users cannot.

• Xiaomi’s MIUI is much more customizable than Apple’s UI.

• Apple’s iOS store has got many apps which are sold at high prices while they are free on
Playstore (e.g. Ankidroid is an application costing 1500 INR in Apple’s while it is for free for Xiaomi and android users).

• A used Xiaomi can be sold at a price more than its MRP while this is not the case with apple.

• Xiaomi phones have the greatest Value for money in the market.

• Above all Apple is way more costly than Xiaomi.

Top 7 tech startups in the World based on its current valuation:

1) Xiaomi : $46 billion
2) Uber : $41.2 billion
3) SnapChat : $16 billion
4) Palantir : $15 billion
5) Flipkart : $10 billion
6) Space X : $12 billion
7) Pinterest : $11 billion

7 P’s which led Xiaomi as a successful brand:

Product: The Company offers high quality phones at unbelievable low price. The product consists of high quality hardware and the final price was very low as compared to other brands.

Pricing: The product was traded on its cost price and this makes it quite cheaper in the market. To reduce overhead costs the phone was sold via online platforms without the involvement of any mediator.

Place: Xiaomi had hired Hugo Barra (ex-Google android executive) to discover new markets for expansion. Xiaomi selected its market wisely and had continued its expansion out of China.

Promotion, Word of mouth: The Flash sales created a sensation and was being talked everywhere. It helped Xiaomi to gather a huge popularity.

Promotion, through social media: Xiaomi has a great advantage of promotion through social media and online forums. Engineers speak directly to consumers and gathered feedback to refine software and remove the bugs.

Promotion, dedicated brand promoters: Xiaomi actively participating in the discussion on social media has succeeded in generating a dedicated fan base of millions of users. Mi-fans are always present at Xiaomi’s product launch where they are known for loud cheering and applauding.

Promotion, CEO as the face of the brand: Last but not least, Xiaomi’s magnetic head, Lei Jun, did a great job in making his brand look cool. He put a face to the brand. Lei Jen’s is quite similar to Steve Jobs in the way he talks about the brand.

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Marketing Strategy of Xiaomi:

Xiaomi has utilized the social media platform quite efficiently and wisely for brand promotion. Xiaomi didn’t spend even a single penny on traditional advertising. The company employs over 2000 people over social media and online forums to manage its online community. These community managers actively follow the discussions on forums to identify new features and bug fixes for next release.

The popularity of the brand can be assumed from the fact that on July 22, 2014, the first stock of Xiaomi Mi3 was completely sold in 39 minutes. Although the site was down with the unexpected high traffic but later it was resolved and taking a lesson from this, website was improved for better user experience and its result was seen on July 29, 2014, the entire inventory vanished in just 5 seconds and on August 5, 2014, the entire lot of Xiaomi Mi3 went out of stocks in merely 2 seconds.

However, Xiaomi had worked with its own unique marketing strategies which landed the brand name on the top rank in the most valuable startup of the world. Here are the strategies adopted.

Strategy 1: Earning revenue from its software

Xiaomi  Revenue Growth

Xiaomi’s earns from its software which is highly customizable MIUI firmware based on android with 30+ million users. Its monthly earning is over $4.9 million from apps, games, and theme customizations installed on MIUI.

Net result= A lot cheaper phone + A great hardware = A happy buyer.

Strategy 2: Zero investment on Traditional Advertising

Unlike other phone brands, Xiaomi didn’t spend even a single penny on the traditional advertisement and has saved a ton of cash and had deployed very much innovative and unique marketing strategy for the brand promotion. The brand only focused on social media marketing and had done great. So you might be thinking how a company can succeed upto this extend with only social media marketing. So here is the answer to your question. Have a look at it.

Step 1: Build a tech fan base

Initially Lei Jun started the company with a single product that was MIUI operating system. Lei Jun was not in the mood to spend money on advertising and marketing, so he along with his squad started to build brand awareness through online forums. They all worked very hard and spent a lot of time on forums, making comments, sending posts and advertising. They used the same method to do marketing with zero budget, they set up MIUI mobile phone forum, which became the base camp of “mi fan” with over 1 million registered users.

Step 2: Engage with fans and make them ‘trustworthy’

Every week, Xiaomi collects feedback from its hardcore users and implements it in the next release whichever is required. Every week, a new version of MIUI is released which is again then analysed by a few hundred thousand hardcore users. “Mi fan” participated in product research, development; test, spread, marketing and public relation. Fans also organized offline city gatherings.

Step 3: Sell directly to your fans and let them promote your brand name

Naturally, the 1 million “mi fan” users became the first buyers of MIUI smartphone. At the same time, Sina Weibo (China’s top twitter like micro blogging platform with 400 million members) grew more and more popular. In December 2012, Xiaomi announced that it will sell phones directly from Sina Weibo.


The unmatched marketing approach proved successful and within two days of the announcement, Xiaomi had sold 50,000 smartphones in five minutes, with 1.3 million additional reservations.

Currently, the company uses Flipkart, Snapdeal and Amazon as online platform to sell its products.


A unique blend of innovative business strategies has really transformed the business of Xiaomi and this brand in just within 5 years of its inception has been ranked number 1 valued startup all across the world.

“In the next five to 10 years, Xiaomi has the opportunity to become the world’s number 1 smartphone company,” Lei Jun told the Chinese-organised World Internet Conference.

“The trick for Xiaomi is that they have managed the cost so well. But if they bring in multiple distribution channels that will increase cost and dilute their cost-competitive advantage.”

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