Xiaomi Corporation is a Chinese multinational company in the electronics industry, which is founded in the month of April 2010. The headquarter of the company is located in Beijing with different regional offices across the world. The company mainly deals with smartphones, mobile applications, laptops, trimmers, earphones, television, fitness products, and bags (Xiaomi, 2019). The Ansoff analysis of Xiaomi would be helping to identify the success of the company in such a short period of time. The Ansoff for the company is provided below with details.
Market Penetration
The revenue of the company for the year 2018 is 25.4 billion USD, with an increment of 52.6 percent as compared to 2017. The total market shares of the company in the Chinese market for the year 2018 is 12.8 percent of such a massive market. These two factors are clearly indicating the successful market penetration strategy of the company. The company has been focusing on gaining a large market share in the presence of giants like Huawei, Q Mobile, and Oppo. The company resisted with its market penetration strategy and came at 3rd rank in terms of market share. The focus of the company towards market penetration is one of the reasons for its such a maverick success within nine years of its operations (Delventhal, 2019).
Product Development
According to Tan & Zhan (2017), product development is the art of culture in Xiaomi as the focus of the company is high on technological innovation and creativity. The company has developed a culture in the organization which fosters and promotes the employees’ innovation and creativity in order to bring continuous development of the highest value to the products of the company. This is the reason that the company has a range of products in its portfolio to put this aim of products developed into a practical strategy. The company offers a range of versions within the same products line, such as mobile and laptops. The smartphones of the company start from cheaper to high priced smartphones, and the case is no different for the laptops. Therefore, the company has kept a high focus towards product development to achieve unprecedented success.
Market Development
Hyun (2017) mentioned that market development is beneficial for the company in different ways, such as increasing the probability of aching the economies of scale and diversifying the customer base. Xiaomi understood the importance of injecting the approach of market development in its strategic planning to put the company on the path of international success. The company started in China in 2010, and the initial success in the country did not provide a sense of contentment to the company, but they were highly motivated to become an international brand. As a result, the company expanded and identified the new regional markets all over the world. Currently, the company and its products can be found in 90 countries of the world, which speaks volumes of its successful implementation of the market development approach. Despite having initial success in the biggest and most populated country, the company set an ambition to expand in different countries to achieve economies of scale and become an internationally successful brand.
Diversification
Xiaomi focused on all aspects of growth, and diversification provides exceptional growth to the company if it is done strategically. The selection of business is important in case of diversifying the businesses; otherwise, the whole reputation of the company can be haunted. Xiaomi has such a culture of growth that it has enabled to implement the related and unrelated diversification in the company successfully. The company started as a smartphone company that diversified to laptops and mobile applications (Greeven & Wei, 2017). The company also diversified unrelatedly, such as bags and routine life-related products. Xiaomi now owns 55 companies that are in the same and different business as of the company. This diversification strategy has laid the foundation for the company for such a maverick success within nine years of operations.
The case of Xiaomi clearly advocating the importance and relevance of growth strategies for the purpose of growing and sustaining internationally. All four growth-related strategies have been adapted by Xiaomi, which has intensified the growth of the company over the years.
References
Delventhal, S. (2019). How Xiaomi makes money. Available at: https://www.investopedia.com/news/how-xiaomi-makes-money/
Greeven, M. J., & Wei, W. (2017). Business Ecosystems in China: Alibaba and Competing Baidu, Tencent, Xiaomi, and LeEco. Routledge.
Hyun, J. H. (2017). Emerging Multinationals in Emerging Markets: Xiaomi Experience in the Indian Smartphone Market.
Tan, K. H., & Zhan, Y. (2017). Improving new product development using big data: a case study of an electronics company. R&D Management, 47(4), 570-582.
Xiaomi. (2019). About us. Available at: https://www.mi.com/global/about