Marketing Group Assignment: Xiaomi Enters Brazil

International MBA Program, Renmin University of China

Lecturer: Dr. Jing Jiang
Due Date: 25/12/2014

Group Six Marketing Consultants

Anna Liu

Organizational Structure, Budget, Execution Strategy, Evaluation

Alex Fu

Products Overview, Pricing Strategy, Promotional Strategy

Cian ODowd

Concept Website Build, Questionnaire, Project Final Edit

Julie Fu

Introduction, Company Overview, Company Strategy

Mikheili Songulashvili -

Background Analysis, Promotional Strategy, Keynote

Introduction
In this project our group will aim to use our diverse knowledge and expertise to develop a marketing
plan for the launching of a new product in a new market for a local Chinese firm. We aim to
practically apply the lessons contained within our Marketing module to develop a custom plan for
how our firm can successfully launch this product into that market using innovative and cost-effective
marketing practices. We will confront the challenges which the firm may face in entering this market
and offer advice as to how they may overcome these.
Our focus text for this assignment was Kotler and Armstrongs Principles of Marketing1. Globally
recognized as the bible of marketing education this textbook offers a solid introduction in the field
of Marketing. As some of our group had not studied Marketing before this easy-to-read book was a
good point of reference. We found it in particular useful when developing our Pricing and
Promotional Strategies.
When selecting a firm for this project our group agreed on three criteria; the firm needed to be local
(Chinese), it needed to be known as a firm which developed innovative products and had a track
record of using unique marketing strategies. We also agreed that it should be a sector in which all
members in the group shared a common interest, after an hour of discussion we came to only one
answer, mobile phones.
Eventually our group decided to pick Xiaomi. We did so as Xiaomi is a very local firm with its
headquarters located a stones throw from Renmin in Zhongguancun. Xiaomi is an incredibly young
Chinese firm that met all our criteria for a firm and has used fun, creative marketing to capture cold
hard market share. Less than five years after its creation it is now already the worlds third largest
smartphone manufacturer2.

Company Overview
Founded in 2010 Beijing Xiaomi Technology Company Limited, trading as Xiaomi is a
manufacturer of Smartphones, Smart TVs, Tablet Computers and other electronic devices. Xiaomis
devices use an in-house developed variant of Googles Android operating system that Xiaomi calls
MIUI OS.

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
!Kotler, P. and Armstrong, G. (2012) Principles of Marketing 14th edn. New Jersey: Pearson Prentice Hall.!
Gibbs, S 2014, China Rising: Xiaomi becomes worlds third largest smartphone manufacturer, The Guardian, 30 October. Available at:
http://www.theguardian.com/technology/2014/oct/30/china-xiaomi-third-biggest-smartphone. [28 November 2014].
1
2

In selecting Xiaomi the main disadvantage for our group was that Xiaomi is as of yet not a publicly
traded company and thus does not issue Annual Reports. The firm is privately owned by a investor
group including its CEO Lei Jun, the Singapore Governments investment body Temasek Holdings
and Chinese venture capital fund IDG Capital3.
Xiaomi has successfully delivered its growth by focusing on Asian markets such as China, India,
Singapore and Malaysia. However Xiaomi executives have spoken openly about entering Western
markets such as the United States, Europe and South America4.
Initially our group assessed several potential markets for Xiaomi to expand into next. When exploring
other developed markets such as Europe and America our group identified a key barrier to entry for
Xiaomi could be legal action by competitors such as Apple and Samsung. Both firms in the past have
taken patent and design infringement actions in US and European courts to have products removed
from the shelves and in recent months press have pointed to similarities in Xiaomi and Apple
products. In October 2014 Jonathan Ives, Head of Design at Apple when referring to claims that
Xiaomi copies Apple designs said5 It really is theft and its lazy. And I dont think its OK at all.
The Brazilian market is sufficiently distant to avoid Apples wrath and lacks the sufficient copyright
legislation to facilitate such action against Xiaomi.
Company Strategy
Since launching its first product in 2011 Xiaomi has followed a cost-differentiation strategy offering a
products with high specifications at highly competitive pricing. It has innovatively used E-Commerce
as its main sales medium as opposed to a traditional bricks and mortar retail network which would
have cost the young firm a considerably sum to develop6.
For Xiaomis most popular products it chooses to sell them on selected days only in what Xiaomi
calls Flash Sales. This occurs due to two reasons: current global demand for Xiaomi devices means
stock shortages are constant and would make managing a constantly operating e-commerce operation
very difficult to manage. Also, by dispatching devices in bulk on particular days this enables Xiaomi
to negotiate discounts from its logistics partners and requires less staff in its warehouse.

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
3

Wikipedia (2014), Wikipedia- Xiaomi. Available at http://en.wikipedia.org/wiki/Xiaomi [Accessed 28 November]

Ibid 3.
Kan, M 2014, Chinas Xiaomi defends itself from Apple copycat claims. Macworld, 29 October. Available at
http://www.macworld.co.uk/news/apple/chinas-xiaomi-defends-itself-from-apple-copycat-claims-3583101/. [28 November 2014].
6
Xiaomi Global Site (2014), Xiaomi About Us. Available at http://www.mi.com/en/about [Accessed 28 November]!
4
5

Background Analysis
SWOT Analysis - Strengths of Xiaomi When Entering Brazil
Emerging Market Favors Xiaomis Cost Model
Xiaomi usually favors entering rapidly developing emerging markets where income levels are rising
but are not yet at Western levels. Such markets find Xiaomis price competitive devices highly
attractive. To date Xiaomi operates in China, India and Russia, by entering Brazil it would be in all
the BRIC nations.
The Hugo Barra Factor
A major incentive for Xiaomi to enter the Brazilian market is that its highly charismatic Vice
President for Global Markets is Brazilian. Recruited from Google Hugo Barra enjoys a huge social
media following and has become the face of Xiaomi outside of China. Having a popular local face
would be a huge advance for Xiaomi when entering the Brazilian market.

Hugo Barra pictured at a recent Xiaomi event in Beijing (Source - Xiaomi.cn)

Brazilian E-Commerce Strength

Research from Forrester Research has claimed Brazils e-commerce market is the largest in South
America and is three times the size of Mexico and Argentinas e-commerce markets combined. In the
past five years it has grown 250% and this receptive e-commerce environment will support Xiaomis
e-commerce focused business model.

SWOT Analysis - Weaknesses of Xiaomi Entering Brazil

Brand Recognition Is Low
A major weakness of Xiaomi when entering the Brazilian market is that its brand is not very
recognizable in this market. While Techies may be aware of it and be eager to purchase its product
the brand is not well known amongst the general public and will require sustained marketing efforts to
build.
Made In China
Unfortunately for Xiaomi many customers in foreign markets still perceive Made in China to mean
poor quality and service. Dispelling this perception will be a major challenge for Xiaomi, especially
when selling its higher tier products.
Absence of an Establish Retail and Service Network
Xiaomis typical business strategy and our strategy for entering Brazil favors an E-Commerce focused
model. However the absence of bricks and mortar retail and service centers could create challenges
for Xiaomi.
SWOT Analysis - Opportunities for Xiaomi when entering Brazil
High Growth Market
Today, Brazil is home to one third of mobile phone users in Latin America and the Caribbean7. This
astounding performance is forecast to continue as the country expands its investment in high-speed
4G mobile phone signal. Euromonitor8 forecasts volume smartphone sales in Brazil to increase by
103% from 2013 to 2018.
Prepaid Customers Dominate The Brazilian Market
Local market research by Teleco has said that of those surveyed 82% of Brazilian mobile users
favored Prepay plans (without singing Contracts). In Q3 2014 76.8% of all Mobile connections in
Brazil were Pre-paid9. This requires customers to pay the full price of the device up-front and thus
favors Xiaomis direct to customer (B2C) e-commerce model while also giving its cheaper priced
devices a natural cost advantage.

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
7

Budde Communications [2014], Brazil Mobile Market Insights. Available at http://www.budde.com.au/Research/Brazil-Mobile-MarketInsights-Statistics-and-Forecasts.html [Accessed 28 November]
8
Euromonitor [2014], Mobile Phones in Brazil. Available at http://www.euromonitor.com/mobile-phones-in-brazil/report [Accessed 29
November]!!
9
Teixeira, M 2014 Brazil Mobile Market, Tech in Brazil. Available at http://techinbrazil.com/recharging-prepaid-mobile-plans-in-brazil.
[Accessed 30 November]

Consumer Products Tax Reduction

In 2013, the Brazilian Government reduced the standard rate of taxation on consumer products such
as mobile phones and tablets to stimulate economic growth. This has made these products more
attainable to millions of low and middle-class customers.
SWOT Analysis - Threats for Xiaomi when entering Brazil
Threat posed by Microsofts Lumia Range
Microsoft (previously known as Nokia) represents a major threat to Xiaomi in the Brazilian market.
Microsofts Lumia range of Windows smartphones offer strong specifications at competitive
pricing. This model is proving particularly popular in developing markets. However can count this
threat by emphasizing its use of Android that is a far more popular operating system amongst
consumers.
Legal Threats by Competitors
While less of risk than in North American or European Markets the threat of legal action does exist
for Xiaomi. Entering new markets intrudes on its competitors and may encourage rivals to take
action against Xiaomi should they feel its infringing on patents or designs. This month Ericsson was
granted an injunction in India against Xiaomi for alleged patent infringement10. Xiaomi was banned
from selling its devices in that market until the issue is resolved.
Products Overview
When selecting the products to market for our project we looked at Xiaomis existing range available
in China11. While the products were extremely impressive and offered exceptional specifications at
competitive pricing their Operating System was the main let down for foreign customers. Due to
Chinas ban on Google products the Xiaomi MIUI operating system has all Google applications
removed. Outside of China tech conscious consumers view applications such as Google Play Store,
YouTube, Google Chrome and Gmail as essential. As a result our new products for our project
are four products from the Xiaomi range with a pure variant of Googles latest Android Lollipop
operating system installed. Each device will naturally have a Brazilian Portuguese pre-installed and
will support the Brazilian 700Mhz 4G frequency. For detailed information on each of our four
products please see Product Overview in the Appendix.

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
10

Bhargava, Y Forced to suspend sales, Xiaomi assessing legal options The Hindu. Available at
http://www.thehindu.com/business/Industry/forced-to-suspend-sales-xiaomi-assessing-legal-options/article6689231.ece [Accessed 13
December 2014]
11
Xiaomi China (2014). Mi. Available at: http://www.mi.com/index.php [Accessed 28 November 2014]

Pricing Strategy
Pricing will play a major role in Xiaomis brand model in Brazil and in forming our marketing
strategy. As illustrated in the graphic below Xiaomi devices have a substantial price difference versus
rival devices of similar specification. This will enable Xiaomi to pursue a strategy of Market
Penetrating Pricing which Kotler and Armstrong12 describe as when companies set a low initial
price to penetrate the market quickly and deeply to attract a large number of buyers quickly and win
a large market share.
Table 1 - Price Comparison of Unlocked Smartphones & Tablets in Brazil
Device Type

Device Name

Device Cost (No Contract)*

Entry Level 4G Smartphone

Xiaomi Redmi M1

BR$ 299 (USD$116)

Entry Level 4G Smartphone

Apple iPhone 5C 8GB

BR$ 1,499 (USD$584)

Entry Level 4G Smartphone

Nokia Lumia 930

BR$ 1,049 (USD$409)

Large Screen Smartphone

Xiaomi Redmi Note

BR$ 369 (USD$143)

Large Screen Smartphone

Apple iPhone 6S Plus

BR$ 2,653 (USD$999)

Large Screen Smartphone

Samsung Galaxy Note 4

BR$ 1,999 (USD$789)

High-End Smartphone

Xiaomi Mi 4

BR$ 849 (USD$325)

High-End Smartphone

Apple iPhone 6

BR$ 2,180 (USD$850)

High-End Smartphone

HTC One M8

BR$ 1,357 (USD$529)

High-End Tablet

Xiaomi MiPad

BR$ 629 (USD$249)

High-End Tablet

Apple iPad Mini 2

BR$ 1,399 (USD$529)

High-End Tablet

Samsung Galaxy Tab S

BR$ 1,152 (USD$449)

Graph Guidelines
* Xiaomi prices are an estimate (Chinese retail prices plus 10%).
~ Prices shown are retail prices for devices sold unlocked (without contract) in Brazil.

Promotional Strategy
In order to ensure sufficient market penetration in such a large market our team will recommend
several mediums to market our new product range. However throughout our priority will be to
minimize cost and maximize innovation.
E-Commerce Strategy and Flash Sales
At the heart of our groups marketing strategy is E-Commerce. E-Commerce offers a cost-effective
alternative to traditional retail networks and allows Xiaomi to sell directly to the Consumer (B2C)
without Retailers and thus substantially increase profit margins. Due to occasional shortages in
Xiaomi stock due to high global demand products will be sold on a time-limited basis via events
known as Flash Sales this means that particular products are only sold on a set day each week, that

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
12

Ibid. 1

day does not change to enable word of mouth to promote the activity. This will create an air of
exclusivity with our products and in doing so increase customer demand. This also enables Xiaomis
Social Media channels to generate interest ahead of these Flash Sales.
MiPop Events
One of Xiaomis unique marketing tools are MiPop events13. These events are held when Xiaomi
launches a new device or enters a new market, it enables Xiaomi to build relationships and spread
awareness of products to local mobile networks, journalists, developers and loyal customers. Key
Xiaomi staff attend these events and the public have the opportunity to try new devices and give
feedback on their experience. The addition of a pure version of Android Lollipop to our Brazilianvariant of the Xiaomi range would likely ensure the popularity of our events with developers and
techies. Our group recommends holding several of these events with Hugo Barra presenting across
several of Brazils largest cities. These events can be run at a relatively low cost but act as highly
targeted PR activity and attract a considerable amount of social media and press coverage.
Something Wonderful Social Media Campaign
Another cost-effective and innovative way of marketing our new products in Brazil is social media.
Social Media is a highly effective medium of promoting products in Brazil. In 2014 remarkably Brazil
was Facebooks second largest market with over 65 million accounts, the worlds second largest
market for Twitter (41.2 million accounts) and the worlds second largest market for YouTube by
unique visitors14. Some international companies have been successful in using Brazils social media
action to spread brand awareness; a noticeable success story in this was Diageos We Are Social
campaign for its Smirnoff Vodka brand15. Over a four-month period Smirnoff Brazil asked customers
to post on its Facebook page photos, videos, songs and stories which embodied the brands Be
There slogan. Over the four-month period the number of fans on Smirnoff Brazils Facebook page
increased by 427% to over one million making Smirnoff the third most popular brand on Facebook in
Brazil. Leslie Orsioli, Managing Director of the We Are Social Campaign said it engaged
customers, encouraged them to engage with the brand and helped them create a bond with Smirnoff,
all this was achieved at minimal cost to the company. Our group suggests Xiaomi follows a similar
strategy surrounding its company motto of Always believe that something wonderful is about to
happen. After launching Xiaomi Brazil Facebook, Twitter and YouTube profiles we would start a
three-month campaign to get users to share their own Something Wonderful via photos, videos and
stories a weekly winner winning a Xiaomi smartphone and tablet. Social Media is also a highly

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13

Xiaomi China Blog (2014).

. Available at http://bbs.xiaomi.cn/thread-10919264-1-1.html [Accessed 28 November]
Holmes, R 2013 The Future of Social Media? Forget about the US, Look To Brazil. Forbes, 9 December. Available at
http://www.forbes.com/sites/ciocentral/2013/09/12/the-future-of-social-media-forget-about-the-u-s-look-to-brazil/. [28 November 2014]
15
Moth, D 2013 10 Innovative Digital Marketing Campaigns from Diageo Brands. E-Consultancy, 16 October. Available at
https://econsultancy.com/blog/63593-10-innovative-digital-marketing-campaigns-from-diageo-brands. [28 November 2014]!
14

measurable marketing medium thanks to web analytics tools such as Google Analytics and Adobe
Omniture that can provide up-to the minute traffic data on these sources and enable Xiaomi to quickly
gauge the effectiveness of these strategies.

Organizational Structure
Following our policy of cost-effective marketing Xiaomi Brazils marketing team structure will be
based on function. Our group is confident that the aforementioned objectives can be achieved with
local team of thirteen staff. During major product launches headcount could be increased in a
temporary basis if additional promotional staff are required. Due to Xiaomis bulk shipping policy
linked to Xiaomi Days and the fact that E-Commerce for Xiaomi will only operate on selected days
we do not require round the clock E-Commerce staff nor do we need several staff to handle logistics,
this will further contribute to Xiaomis cost-savings.
Head!of!
Marketing!
(Brazil)!

Senior!Management!
Public!
Relations!
Manager!

Team!Managers!
Staff!

PR!Rep!

Brand!
Ambassador!

Social!Media!
Manager!

Event!
Planner!
(MiPop)!

Social!Media!
Promoter!

Customer!
Care!Rep!

Creative!
Manager!

Graphics!
Designer!
(Print)!

EF
Commerce!
Manager!

Web!
Developer!

Graphics!
Designer!
(Web)!

Execution Strategy
When developing our plan to enter Brazil our team concluded that there should be a focus on
minimizing cost and external activity. By keeping marketing options in-house we can minimize delay
and run operations using a small team of our own dedicated staff. Below we have put together a GTM
Timetable (Go-To-Market) based on the perception that Xiaomi wishes us to launch the website just
before Christmas.

Table 1 Go To Market (GTM) Timetable for Xiaomi Brazil Marketing Plan

Go To Market Timetable For Xiaomi Brazil Marketing Plan
Week One

Week Two

Week Three

Week Four

Week Five

Week Six

November 10th - 16th

November 17th - 23rd

November 24th - 30th

December 1st - 7th

December 8th - 14th

December 15th - 21st

Design Planning

Graphics Designers with Teams plan site/social media designs

Event Planning

First MiPop Event venue booked in Sao Paulo.

Site Build Commences

Website construction begins based on pre-agreed designs

Social Media Pages Launch

Social Media Team launch pages, upload content and images

Event Planning

Prepare venue layout for MiPop event, invite Press & Bloggers

Site Build Nearing Completion

UI Testing, SEO Testing via Google Analytics & Adobe Omniture

Social Media Pages Launch

Social Media goes live, first posts - shows product graphics

Event Planning

Offer limited tickets to MiPop event for social media subscribers

Xiaomi Brazil Website Goes Live

Frontend live but E-Commerce not launched

Social Media Pages Go Live

Something Wonderful' Social Media Competition launches

Event Planning

Final preparations ahead of MiPop event, rehearsal of activities

First Post from Hugo on Website

First Post from Hugo's Blog ahead of first Flash Sale in Brazil

Social Media Promotes Hugo Post

Daily countdown to pre-orders, coverage of MiPop event

Event Planning

MiPop Event - Friday 14th, Hugo attends - Social Media Presence

Our First "Flash Sale" in Brazil

Pre-orders taken on Monday 15th, bulk dispatches occur 17th-18th

Social Media Promotes Xiaomi Day

Strong Social Media Activity - launch and dispatch days celebrated

Event Planning

Next 'MiPop' event announced for Rio De Janiero & Brasilia

Budget
Through adopting an E-Commerce and Social Media focused Marketing Strategy our group is able to
deliver a project to Xiaomi that achieves sales objectives at minimal expenditure. By adopting the
Flash Sale strategy these cost-savings can also be continued in the logistics side of the business. As
Social Media activity forms the majority of our advertising activity we enable Xiaomi to avoid costly
print media and television advertising costs.

Website Build

$2,000 USD

Server Hosting

$5,000 USD P.A.

MiPop Event

$30,000 USD

Forecasted Marketing Expenditure

$37,000 USD

Evaluation
Xiaomi today represents a Chinese company at the forefront of technology and innovation. It is thus
only right that they have a Marketing Strategy for entering new markets that reflects this stance. In
selecting a target market our group decided that copyright and intellectual property laws played a
major role in where Xiaomi could go and was the deciding factor in why the company could not enter
the North American or European Markets. Brazil represented a good market due to its ambiguity
surrounding foreign copyright protection, its high growth economy, recent adoption of 4G and strong
E-Commerce sector. When deciding our marketing strategy for Brazil our group felt it was essential
that we developed a strategy in line with the existing Xiaomi brand but yet was also sensititive to the
intricacies of Brazilian culture. In general we feel our strategy represents a strong entry plan for
Xiaomi highlighting its innovative culture and offers optimum customer reach at minimal cost.
Xiaomis existing E-Commerce-focused business strategy coupled with its bulk dispatches and
limited sales days have proven to be a highly effective model. It generates customer demand for
products and creates a perception of rarity while at the same time achieving optimal use of logistics
and staffing. We felt that continuing with the E-Commerce focused strategy was the best way forward
and offered considerable cost savings versus a traditional retail strategy. The rapid growth of ECommerce within Brazil suggests that our faith in E-Commerce is likely to prove successful.
Recognizing the popularity of Social Media in Brazil our plan prioritizes this area as a cost-effective
means of encouraging customer interaction and affinity with the Xiaomi brand. The outstanding
success of past Social Media-led marketing campaigns in that market gave us confidence and
precedence in which to follow16. While in its home market due to Government restrictions Xiaomis
activity in Facebook, YouTube, Twitter and Instagram has been low key we would recommend a
dedicated Social Media Team to target these mediums.
When looking at execution our proposed strategies could be rolled out in a very short period of time
with minimal staffing. Whilst traditional marketing mediums such as Print Advertising and Television
would require the involvement of third parties and take a longer timescale to roll out our strategies
could be launched entirely from within Xiaomi.

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
16

Ibid. 13

Marketing Group Assignment: Xiaomi Enters Brazil

International MBA Program, Renmin University of China

Appendix, Bibliography and Presentation Slides

Products Overview

Product One Entry Level 4G Smartphone - Xiaomi Redmi M1

After our group analyzed this product we concluded that its competitive specs and pricing made it an
ideal choice for the Brazilian market. Adding a pure variant of Android Lollipop into the mix makes
this a high spec device at a very affordable price point. Its 4G support would make it an attractive
option for Mobile Networks to purchase as they attempt to encourage 4G adoption. Marketing for this
device would target young consumers and focus on the Red M1s super-fast quad-core processor, 4G
support, Android Lollipop support and variety of colors.
To Market Price in Brazil 299 Brazilian Reals (USD$116)
Product Two Phablet Phone/Tablet Smartphone Xiaomi Redmi Note
Our group concluded this would be a strong competitor in the phablet segment of the Brazilian
market as a substantially cheaper alternative to the Apple iPhone 6 Plus and Samsung Galaxy Note 4.
Our marketing would target 18-35 year old consumers and would focus on cost, the phones fast
eight-core processor, 4G support and impressive 13-megapixel camera.
To Market Price in Brazil 369 Brazilian Reals (USD$143)
Product Three High-End Smartphone Xiaomi Mi4
This device again offers superior specifications and high-quality construction at an affordable price.
Our group would focus marketing for this product on cost as it has a highly competitive spec which
could rival the likes of iPhone 6 and Samsung Galaxy S5 and yet is also less than half the retail price
of those devices. The target audience for this device would be middle-aged professionals aged 25-50.
To Market Price in Brazil 849 Brazilian Reals (USD$325)
Product Four Tablet Device Xiaomi MiPad
To capitalize on the growing Tablet Computer market our group selected the Xiaomi Mi-Pad to also
enter the Brazilian market. The MiPad offers a near identical specification to the Apple iPad Mini but
costs USD$200 less. Coupled with our additional of Android Lollipop we are confident this would be
a very strong seller in the Brazilian market. At an attractive price point we would target a broad range
of customers with this device and our marketing activity would focus on price, the availability of
colors and the addition of Android Lollipop.
To Market Price in Brazil 629 Brazilian Reals (USD$249)

Questionnaire
Our team conducted a survey to determine insights into the young Brazilian consumer today.
Unfortunately due to our current location our survey was restricted in scale and was conducted with
ten young Brazilians living in Europe.
Sample Questionnaire As E-Mailed To Participants
Thank you for participating in our survey regarding Xiaomi selling products in Brazil. For Question
Six please rate your answer according to the scale of one to five. One being Highly Unlikely to Five
being Highly Likely.

Question One - Have you heard of the brand Xiaomi before?

Question Two If you answered Yes to Question One, given what you know about Xiaomi already
would you buy a Xiaomi device?

Question Three If you were to use three words in English to describe Xiaomi what would they be?

Question Four After looking at Table One concerning the price differences between Xiaomi and
other manufacturers in Brazil would you be more inclined to buy Xiaomi.

Question Five Would you prefer to buy your next phone online on in-store?

Question Six After viewing our website would you be interested in purchasing Xiaomi?

The results of the Questionnaire were quite insightful, unfortunately only five out of our ten
participants had heard of Xiaomi before but four out of those five said they would consider buying
such a product. The two key terms that arose from Question Three were Chinese and Android
thus our decision to adopt a new pure Android variant for Brazil is likely a wise decision. Question
Four received an emphatic response from those surveyed with ten out of then saying they would be
more inclined to purchase Xiaomi after looking at our price comparison table, this result guided us to
make price a key focus in our marketing. Question Five gave us faith in the Xiaomi strategy with only
one person saying theyd rather purchase in-store than online, yet another example of the success of
E-Commerce in Brazilian society today. Finally, in Question Six, four out of our ten participants said
they would be Highly Interested in purchasing Xiaomi after looking at our website while three out
of the ten said they would be Interested in purchasing Xiaomi after looking at our site.

Bibliography
Textbooks

Kotler, P. and Armstrong, G. (2012) Principles of Marketing 14th edn. New Jersey: Pearson Prentice
Hall

Online Articles

Gibbs, S 2014, China Rising: Xiaomi becomes worlds third largest smartphone manufacturer, The
Guardian, 30 October. Available at: http://www.theguardian.com/technology/2014/oct/30/chinaxiaomi-third-biggest-smartphone. [28 November 2014].

Wikipedia (2014), Wikipedia- Xiaomi. Available at http://en.wikipedia.org/wiki/Xiaomi [Accessed 28

November]

Bhargava, Y Forced to suspend sales, Xiaomi assessing legal options The Hindu. Available at
http://www.thehindu.com/business/Industry/forced-to-suspend-sales-xiaomi-assessing-legaloptions/article6689231.ece. [Accessed 13 December 2014]

Kan, M 2014, Chinas Xiaomi defends itself from Apple copycat claims. Macworld, 29 October.
Available at http://www.macworld.co.uk/news/apple/chinas-xiaomi-defends-itself-from-apple-copycatclaims-3583101/. [28 November 2014].

Teixeira, M 2014 Brazil Mobile Market, Tech in Brazil. Available at

http://techinbrazil.com/recharging-prepaid-mobile-plans-in-brazil. [Accessed 30 November]

Holmes, R 2013 The Future of Social Media? Forget about the US, Look To Brazil. Forbes, 9
December. Available at http://www.forbes.com/sites/ciocentral/2013/09/12/the-future-of-social-mediaforget-about-the-u-s-look-to-brazil/. [28 November 2014]

Moth, D 2013 10 Innovative Digital Marketing Campaigns from Diageo Brands. E-Consultancy, 16
October. Available at https://econsultancy.com/blog/63593-10-innovative-digital-marketingcampaigns-from-diageo-brands. [28 November 2014]

Research Documents

Budde Communications [2014], Brazil Mobile Market Insights. Available at

http://www.budde.com.au/Research/Brazil-Mobile-Market-Insights-Statistics-and-Forecasts.html
[Accessed 28 November]

Euromonitor [2014], Mobile Phones in Brazil. Available at http://www.euromonitor.com/mobilephones-in-brazil/report [Accessed 29 November]

Company Publications

Xiaomi Global Site (2014), Xiaomi About Us. Available at http://www.mi.com/en/about [Accessed
28 November]

Xiaomi China Blog (2014).

[Accessed 28 November]

. Available at http://bbs.xiaomi.cn/thread-10919264-1-1.html

Meet Our Team

?
A?D .

C AB

CB

? BD C

Project Brief

Complete a marketing plan for a hypothetical

product that your group creates for a selected
company.

Choosing Xiaomi

Company should be Chinese (It is!)

Company should be local (Its based in Haidian!)

Company should be involved in a sector of

common interest (Everyone loves Mobile Phones!)

Xiaomi is one of Chinas most innovative and

fastest-growing companies!

Company Overview

Founded in 2010 in Beijing

Owned by CEO Lei Jun, IDG Capital and

Temasek Holdings

Manufacturer of Smartphones, Tablets & Other

Technology Products and Accessories

Allegations of copying Apples designs - It

really is theft and its lazy - Jonathan Ives, Apple

Company Overview

Has successfully deployed its MIUI OS

operating system - a Chinese variant of Android
without Google functionality

Within four years has gone from producing its

first device to being the Worlds third largest
Smartphone brand

VP of Global Business - Hugo Barra, Former

Head of Android at Google

Meet Xiaomi

Company Strategy

E-Commerce Rather Than Retail

Design Focused On Ease of Build

Bulk Price Negotiations with Manufacturers

Advertise Via Social Media Only - No TV/Print

Flash Sales

Background Analysis
Strengths

Background Analysis
Weaknesses

Emerging Markets Favour Xiaomis Cost Model

Brand Recognition is low

The Hugo Barra Factor (Hes Brazilian!)

Made in China

Brazilian E-Commerce Strength

Absence of an Established Retail Network

Background Analysis

Background Analysis
Threats

Opportunities

Microsoft Lumia Threat

High Growth Market

Growth of Chinese Rivals (Huawei, ZTE etc.)

Prepaid Customers Dominate Brazilian Market

Threat of Legal Action by Apple, Samsung, HTC

Consumer Products Tax Reduction

India Injunction by Ericsson

Similar action in Brazil unlikely to succeed

Product Overview
Xiaomi Redmi M1
Key Changes with new Brazilian variants

Replace Chinese MIUI OS with Android Lollipop (Most

recent version of Googles OS) - A new strategy for Xiaomi

Add Portuguese language functionality for Brazilian market

Update antenna specifications to support Brazilian 4G

frequency (700Mhz)

Change charger type to support Brazilian power supply

Xiaomi Redmi Note

Specifications
5.5 Phablet Device
Now with Android Lollipop
Quad-core Processor
8GB Internal Storage
Target Market
Targeted at 18-25 year old Brazilian
consumers
Heavy internet users attracted to the
larger screen for browsing
experience
Low to Medium Income

Specifications
Entry-Level Xiaomi Phone
Now with Android Lollipop
Quad-core Processor
8GB Internal Storage
Target Market
Targeted at 18-25 year old
Brazilian consumers
Low to Medium Income

Xiaomi MiPad

Specifications
7.9 Tablet Computer
Now with Android Lollipop
Nvidia Tekra K1 Processor
16GB Internal Storage
Target Market
Targeted at 21-35 year old
Brazilian consumers
Low to Medium Income

Pricing Strategy
Xiaomi Mi4

Specifications
Premium-Level Device
Now with Android Lollipop
High Build Quality
16GB Internal Storage
13MP Camera (with 8MP front)
Target Market
Targeted at 21-35 year old
Brazilian consumers
Medium to High Income

Table 1 - Price Comparison of Unlocked Smartphones & Tablets in Brazil

Device Type

Device Name

Entry Level 4G Smartphone

Xiaomi Redmi M1

Device Cost (No Contract)*

BR299 (USD$116)

Entry Level 4G Smartphone

Apple iPhone 5C 8GB

BR1,499 (USD$584)

Entry Level 4G Smartphone

Nokia Lumia 930

BR1,049 (USD$409)

Large Screen Smartphone

Xiaomi Redmi Note

BR369 (USD$143)

Large Screen Smartphone

Apple iPhone 6S Plus

BR2,653 (USD$999)

Large Screen Smartphone

Samsung Galaxy Note 4

BR1,999 (USD$789)

High-End Smartphone

Xiaomi Mi 4

BR849 (USD$325)

High-End Smartphone

Apple iPhone 6

BR2,180 (USD$850)

High-End Smartphone

HTC One M8

BR1,357 (USD$529)

High-End Tablet

Xiaomi MiPad

BR629 (USD$249)

High-End Tablet

Apple iPad Mini 2

BR1,399 (USD$529)

High-End Tablet

Samsung Galaxy Tab S

BR1,152 (USD$449)

*Xiaomi prices are an estimate (Chinese retail prices plus 20%).

~ Prices listed are for devices sold unlocked (without contract) in Brazil.

Promotional Strategy
E-Commerce Strategy

Business to Consumer (B2C)

No Retail Network (No Retail Costs)

Dont sell to Retailers or Mobile Networks

Flash Sales Strategy

Lower Logistics Cost

Sense of Exclusivity

Flash Sale Explained

Promotional Strategy
MiPop Events

Reach Out To Press, Corporate, Techies

Generate PR in Traditional Media

Create Brand Loyalty

Promotional Strategy
Using Social Media Instead Of Traditional Media

Diageos Smirnoff Vodka brand in Brazil

We Are Social Social Media Campaign

427% Increase in Facebook Fans in just four

months - Over 1m - 3rd FB brand in Brazil

Promotional Strategy

Smirnoff Brazil We Are Social

Your Something Wonderful Campaign

Using Xiaomis motto Always believe something

wonderful is about to happen

Daily Give Aways - Media - Share Your

Something Wonderful - Daily/Weekly Prizes

Let Our Customers Advertise For Us.

Organisational Structure

Lean with Minimal Cost

Function-based

Execution Strategy

No Traditional Marketing

E-Commerce/Social - Short Development Time

Go#To#Market#Timetable#For#Xiaomi#Brazil#Marke3ng#Plan
Week$One

November$10th$1$16th

Week$Two

November$17th$1$23rd

Week$Three

Week$Four

Week$Five

Week$Six

Budget

Highly cost-effective marketing model

Far cheaper than Traditional Marketing strategy

Plan Budget (Estimated)

Website Build - $2,000 USD

Server Hosting - $5,000 USD P.A.

MiPop Sao Paulo Event - $30,000 USD

Something Wonderful Prizes - $3,000 USD

Total Plan Cost - In the region of $40,000 USD

November$24th$1$30th$

December$1st$1$7th

December$8th$1$14th

December$15th$1$21st

Design$Planning

Graphics$Designers$with$Teams$plan$site/social$media$designs

Event$Planning

First$MiPop$Event$venue$booked$in$Sao$Paulo.

Site$Build$Commences

Website$construcLon$begins$based$on$pre1agreed$designs

Social$Media$Pages$Launch

Social$Media$Team$launch$pages,$upload$content$and$images

Event$Planning

Prepare$venue$layout$for$MiPop$event,$invite$Press$&$Bloggers

Site$Build$Nearing$CompleLon

UI$TesLng,$SEO$TesLng

Social$Media$Pages$Launch

Social$Media$goes$live,$rst$posts$1$shows$product$graphics

Event$Planning

Oer$limited$Lckets$to$MiPop$event$for$social$media$subscribers

Xiaomi$Brazil$Website$Goes$Live

Frontend$live$but$E1Commerce$not$launched

Social$Media$Pages$Go$Live

Something$Wonderful'$Social$Media$CompeLLon$launches

Event$Planning

Final$preparaLons$ahead$of$MiPop$event,$rehearsal$of$acLviLes

First$Post$from$Hugo$on$Website

First$Post$from$Hugo's$Blog$ahead$of$rst$Flash$Sale$in$Brazil

Social$Media$Promotes$Hugo$Post

Daily$countdown$to$pre1orders,$coverage$of$MiPop$event

Event$Planning

MiPop$Event$1$Friday$14th,$Hugo$a\ends$1$Social$Media$Presence

Our$First$Flash$Sale"$in$Brazil

Pre1orders$taken$on$Monday$15th,$bulk$dispatches$occur$17th118th

Social$Media$Promotes$Xiaomi$Day

Strong$Social$Media$AcLvity$1$launch$and$dispatch$days$celebrated

Event$Planning

Next$'MiPop'$event$announced$for$Rio$De$Janiero$&$Brasilia

Summary

Our Product is innovative, attractive and has fit.

High-growth market with infinite potential.

Our Plan focuses on the non-traditional reflecting

our young brand. In using Social Media our
customers advertise for us!

This Plan can be implemented in just six weeks at

a cost which is a fraction of alternative strategies.

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