October 23, 2014 by ...
A survey of college students in China is floating around the net. The survey was about their opinions on various smart phone brands. Unfortunately for Xiaomi the results were painful. For example, when asked why they bought Xiaomi, the vast majority replied that it was due to its cheap price. In and of itself this is not a bad thing, but what followed was worse. The students were also asked if they actually ‘liked’ the brand Xiaomi and only 23% said yes. One must keep in mind that these are Xiaomi’s current customers; they are familiar with the phones. When compared to customers of other brands Xiaomi, users were less than enthusiastic. In what can only be described as a cringe moment for Xiaomi, 70% of all Apple and Samsung owners surveyed said that ‘really’ liked their respective brands.
From what I’ve seen in interacting with Xiaomi users here in China is that there are two primary reasons for their disenchantment with Xiaomi. The first is that they regard it as ‘shanzhai’ or fake. In fact just the other day when I asked two different people about Xiaomi they both said ‘I don’t buy knockoff phones.’ Both were women in their twenties which is a crucial segment of the Xiaomi market.
Another problem stems from quality related issues. Xiaomi has been in China for a few years now but you don’t see three year old Xiaomi sets. Iphone 4’s abound and even older Nokia units, but it seems as if the first and second generation Xiaomi phones have all died. This is true for the very first generation Xiaomi phone which I purchased myself. That handset lasted for nearly 12 months and was struggling the last three months of its life. Many Xiaomi users share similar experiences; Xiaomi phones are not built to last.
Associated with this is poor customer service. Xiaomi seems more concerned with getting new clients as opposed to satisfying their current ones. Indeed this seems to be a big part of their business model.
One can extrapolate from the data and see that things do not look rosy for Xiaomi in terms of brand loyalty. People purchase those handhelds due to
Low price and good specs but see Xiaomi as an entry level phone. Once they have more money these customers will move upstream to Apple and or Samsung. Quality concerns coupled with Xiaomi’s lack of originality are hurting it in its home market. Will the same be true of other places such as India a few years down the road?
Xiaomi’s rock bottom pricing model may hurt its long term prognosis of ever truly becoming the Apple of China.