Xiaomi eyes e-commerce channels for computer sales as it battles decelerating growth in smartphone segment

By Zhang Ye Source:Global Times Published: 2016/7/27 23:03:00

People try out Xiaomi's first laptop during the company's press conference held in Beijing on Wednesday. Photo: Zhang Ye/GT



Xiaomi Inc, which is known for its online sales of low-budget phones, wants to expand that business model to the personal computer (PC) sector, as its core smartphone segment is experiencing slowing growth.

On Wednesday, the first Xiaomi laptop model, called Xiaomi MiBook Air, debuted at a press conference in Beijing.

Founder Lei Jun claimed that the device, offered in two models to attract gamers and office workers, has a larger display but is smaller overall than Apple Inc's MacBook Air.

However, it seems that Xiaomi's PC doesn't appeal to consumers like Shang Xin, a 30-year-old Beijing resident.

"I was looking forward to the launch of the Xiaomi laptop, hoping it would have many specifications at a low cost. But I'm disappointed," Shang told the Global Times Wednesday, noting the central processing unit on the Xiaomi laptop is too slow to run high-resolution games.

The price of the long-awaited gadget starts at 3,499 yuan ($524.7), which Shang said isn't much better than competing models.

Analysts also questioned the prospects of Xiaomi in the PC field, as that industry has matured and is facing slow consumer replacement.

Worldwide PC shipments fell 4.5 percent year-on-year to 62.4 million in the second quarter of 2016, International Data Corp (IDC) said on July 11.

"The sales channels and marketing of PCs are totally different from those of the mobile phone segment, meaning Xiaomi needs to spend lots of time and effort to carve out a position in the concentrated PC industry," Wang Yanhui, head of the Shanghai-based Mobile China Alliance, told the Global Times Wednesday. 

Wang said the online sales move likely ­reflected Xiaomi's goal of further ­diversifying its product range, with the company's smartphone sales growing sluggishly amid the slowing market and fierce competition.

Worldwide smartphone shipments reached 314.6 million in the second quarter, up  from 289 million in the first quarter, according to data from market ­research firm TrendForce.

During the first quarter, China's lesser-known smartphone brands OPPO and vivo displaced the previous No.4 and No.5 players Lenovo and Xiaomi, respectively, according to a report by IDC in April.

"The majority of phone purchases in China are still made through physical stores, a traditional sales channel where Xiaomi is weak while brands like OPPO have strength," said Wang.

To increase sales, Xiaomi decided to offer its latest smartphone, the Redmi Pro, online and offline simultaneously for the first time.

According to Lei, the dual-camera Redmi Pro, with a price starting at 1,499 yuan, will be available on August 6 in 2,149 physical stores around the world operated by its retailing partners.

Xiaomi is boosting efforts to develop and promote Redmi, a sub-brand of Xiaomi's smartphone lineup.

The company disclosed at the conference that it sold more than 110 million phones under the Redmi brand over the past three years.

Wang noted that if Xiaomi wants to substantially boost phone sales, it should establish a brick-and-mortar sales channel of its own.

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