We need to talk about Xiaomi: ‘China’s Apple’ counts on word of mouth to promote its phones

Don’t expect to see slick, glossy advertisements for Xiaomi’s mobile phones on public transport, billboards or even televisions near you: China’s top smartphone maker says it relies on satisfied customers to spread the word, not huge marketing budgets.

Often dubbed “China’s Apple”, Xiaomi’s rapid rise up the world smartphone rankings with its low-cost, high-spec devices has come about without a lot of the big spending  associated with the big names in the field such as the US company and South Korean giant Samsung.

 “I like to joke that, although many people see Xiaomi as a company that gets in the headlines a lot in China and does a lot of PR and marketing, the budget in the marketing department is actually very close to zero,” co-founder and vice president Kong Kat Wong said at a recent conference in Hong Kong.

 “We don’t rely on the traditional advertisement to sell our product, we actually rely on the products to sell themselves. If the product is attractive you can actually get a lot from word of mouth,” he told the Digital Entrepreneur Leadership Forum at the city’s Cyberport.

Wong said the company has chosen to pass on the savings on marketing to consumers to help keep prices low. Chatter about its smartphones on social media has allowed the brand’s name to reach down to China’s myriad of villages, which would normally be outside the scope of traditional advertising channels, he added.

That’s a far cry from Samsung’s approach, with media reports saying the company may have spent some US$14 billion on advertising and marketing globally last year, taking in billboards, TV ads, sports and arts events and even product placement deals in movies and TV programmes.

And one of Xiaomi’s domestic rivals, Xiamen-based smartphone maker Meitu, launched its M4 phone in Beijing earlier this month at an event attended by dozens of models and celebrities and complete with a background of cherry trees, said to allow for more artistic selfies. 

Meitu, which started life as a software developer, now has 440 million users of its photo-editing app Meituxiuxiu and aims its phones at dedicated takers of selfies.

Xiaomi’s approach appears not to have done it any harm, however. It sold a record 2.11 million handsets in a 12-hour sale to celebrate its fifth birthday earlier this month.

The event, entitled “Mi Fan Festival”, brought in 2.08 billion yuan (US$335 million) from the sale of smartphones and other accessories, breaking the record for the most number of smartphones sold in a single day. That was previously held by Alibaba, which sold 1.89 million on its Singles Day spendfest last November.