“Speed” is one word many people think of when they live in China. If you look at the startup culture in the Silicon Valley, speed and fast response to market are top reasons for success, along with passion and commitment. From launching new products to winning the hearts and minds of consumers, those principles work equally well in China. Speed of both design and production in China is one of the vital elements of Chinese impressive economic rise. Today, China’s speed is multiplied several times, largely because China has elements in its ecosystem (component suppliers, software developers and contract manufacturers) that can accelerate even further.
I have always been puzzled at how smartphone vendor Xiaomi has emerged from obscurity in few years to overtake Samsung as the most dominant smartphone vendor in China. According to IDC, Xiaomi has become the world’s third-largest smartphone vendor by shipments after Samsung and Apple in less than five years. The company shipped more than 17 million smartphones in the third quarter of 2014, mostly on the Chinese mainland.
If smartphones and tablets are what Xiaomi is best known for, the company is also on track to become a massive player in the wearable space. Xiaomi has already sold one million Mi Band fitness trackers in the three months since its launch (a hundred days exactly), making the device China’s top wearable tech product and possibly the world’s bestselling fitness tracker. I wouldn’t be surprised to see Xiaomi launching its own version of the Apple Watch sometime soon. The point is that Xiaomi is moving fast, ultra-fast, faster than Apple and Samsung thanks to some savvy marketing, unique crowd-sourced innovation technique, and continuous and incremental improvement. By executing its continuous improvement strategy, Xiaomi does seem to create not only the opportunity for rapid market entry and exit, but also perhaps more importantly, more value for its users.
In the battle of the Internet of Things, Xiaomi has also a clear lead in China. Last October, the company announced four new products as part of its own smart home lineup: a smart camera, a smart bulb, a smart socket, and a smart remote control center. Yesterday, Lei Jun, Xiaomi’s CEO, introduced a smart and sexy air purifier that sends its users real-time pollution updates. Expected to hit the market next week, the device will sell for only $145, a fraction of the cost of rival products with similar capacities.
Xiaomi’s diversification in the Internet of Things is no coincidence. Clearly, the company seeks to strengthen ecosystem lock-in and mimic its success with its smartphones with other hardware. Xiaomi’s air purifier and current smart-home devices might be just a warm-up for Xiaomi’s wider ambition with the Internet of Things. Investing in third-party startups and joining forces with other manufacturers to build the next-generation products are already on Xiaomi’s roadmap.
Ultimately, Xiaomi wants to sell a way of life to Chinese consumers and embracing the Internet of Things at “China Speed” might be the best way to pull off this ambition.