Inside Xiaomi’s Everything Store at Beijing's The Place
This post comes courtesy of our content partners at TechNode.
Have
you ever walked into a store, saw the products on display and thought
you entered the wrong place? That’s what happened when I visited Xiaomi’s store at The Place in Beijing ... until it dawned on me: I was exactly where I meant to go.
Sports
shoes, toothbrushes, and mattresses are not the kind of products you
would expect to find in a store selling high-tech consumer electronics.
But during the past year, Xiaomi has been churning out all kinds of
goods, from smart appliances to pillowcases.
The smartphone maker
seems intent on breaking the rules on what a tech company should look
like. Although the company was once dubbed the "Apple of China",
visiting one of 300-plus Mi Home stores across the country is now more
akin to a walk through Japanese retail store MUJI than an Apple Store.
There
is the already ubiquitous low-cost air filter, water purifiers, and
Roomba-style robot vacuum cleaners. There are smartphones, VR headsets,
smart TVs, and drones. There are electric bikes and self-balancing
scooters made with Ninebot, the Chinese company that bought Segway. And
then there are other things.
Xiaomi’s Mi Store at The Place shopping mall in Beijing
Xiaomi’s
product line now covers three areas – smartphones, smart devices
connected to Xiaomi’s IoT platform, and non-smart products. It’s the
“dumb” products that captured our attention – how does a company that
sells smartphones turn to selling sofas? More importantly, how does it
break the RMB 100 billion in annual sales threshold within just seven
years of existence and become the most anticipated tech IPO of the year?
“Xiaomi
had huge success with their phones but then they lost a lot of market
share in 2016,” Peking University professor and Chinese consumer
specialist Jeffrey Towson told TechNode.
During 2016, Xiaomi saw stiff competition from low-cost phone makers
Huawei, Oppo, and Vivo and decided to change its strategy. It opened its
Mi Stores.
“They made the decision to no longer be just a
smartphone company, they became a smart devices ecosystem company and
now they are making another advance into a more lifestyle company,”
Towson said.
Xiaomi has so far invested in 89 companies that make
items in the Mi Ecosystem beyond their core products such as
smartphones, smart TVs, and routers. According to the company, many of
those have been incubated by Xiaomi from their founding. This means that
Mi Stores, which suspiciously resemble Apple Stores, have been steadily
filling up with products and attracting curious shoppers.
Xiaomi’s Mi Store at The Place, Beijing
“Every time you go into a Xiaomi store there’s something new to discover,” said Towson.
Xiaomi
reminds Towson of the old days of Apple when he used to go see what
were the new products on display. But the similarities with Apple don’t
stop at that or even at the design of Mi Stores and Xiaomi products
(described as “simple, peaceful and humble” by senior director of
industrial design of Mi Ecosystem Li Ningning).
According
to Towson, Apple’s success was based on the relationship with its fans.
This is how Apple turned itself from a consumer electronics brand into a
luxury brand whose financials are not so different from Gucci and
Prada. As Warren Buffet would
put it, brands such as Apple own a piece of the consumer’s mind – they
get into our heads and make us think positively about them. Xiaomi is
halfway there, Towson believes.
Xiaomi fans or Mi Fans (米粉 mǐfěn which
translates literally to “rice noodles” in Chinese) have indeed played
an important part in Xiaomi’s growth. Mi Fans in China contribute to the
design of Xiaomi’s products and participate in tweaking MIUI, Xiaomi’s
smartphone operating system. They also participate in regular nationwide
and city-level events.
But what drew fans to Xiaomi is not just good quality for an affordable price. As Xiaomi fan and TechNode’s Creative Director Liu Teng put it, Xiaomi is China’s “shanzhai (山寨) terminator”, the one company that is stopping counterfeit consumer goods.
“That
is its biggest contribution to China’s manufacturing industry,” said
Liu. “In the past, if you wanted to buy a new category of products, like
a TV box or a Bluetooth audio converter, you would sometimes only have shanzhai goods.”
Liu
does not see Xiaomi as China’s Apple but China’s Belkin – a US consumer
electronics manufacturer that specializes in connected devices. He also
sees differences in how Xiaomi approaches its consumers.
Some
of Xiaomi partner products are designed with smart features. The
running shoes have a chip that helps track runners’ activity and the
suitcase can be located and opened via Bluetooth
“I
think Xiaomi is aiming for two types of consumers,” said Liu. “One is
young people that want a higher quality of life. They buy products which
are relatively inexpensive but have better design and manufacturing or
have intelligent functions added to traditional products. It’s like
China’s Belkin or China’s MUJI. Products such as rice cookers and
projectors, these are for students or workers that have a lower budget.
Xiaomi provides a better quality for products such as smartphones and
earphones but offers the same price as shanzhai.”
Will
the sofas sell, however? Liu believes that some of China’s Mi Fans are
not inclined to buy things like towels from a tech company. Other Mi
Fans have raised eyebrows over Xiaomi’s increasingly colorful product
palette. During the Chinese New Year holiday, Xiaomi presented the
latest products from its partners: a traditional Chinese lucky gourd
made of copper. Xiaomi’s big thing might not be cloning MUJI or Belkin
but selling fengshui, as Mi Fans have joked.
A lucky gourd made by Xiaomi’s partner Tong Shifu
For
now, Xiaomi does not offer all of its partner products in every
country. Its biggest market outside of China is India. Xiaomi has opened
its 25th store in the country called Mi Home Experience to test which
products besides phones might take off. The company also opened its
first store in western Europe (in Spain) in November last year and,
according to media reports, the US might be next.
Looking at
Xiaomi’s Indian success (in 2017 the company saw a 696% sales surge to
$1.3 billion), there is reason to be optimistic about the international
spread of Mi fandom: In China, companies such as Xiaomi have already
driven prices of high tech products down so much that the term
“cabbage-ification” (白菜化 báicài huà) has entered the Chinese
vocabulary. A recent viral video (see below) of a farmer in rural China
driving to her field on a Ninebot self-balancing scooter showed that
technology products that were once expensive and advanced have become as
widespread as cabbage. International shoppers may not say “shut up and
take my money” for the copper gourds but they won’t mind the
cabbage-ification of high tech.
Xiaomi Store 小米之家
Daily 10am-10pm. 1/F, 9 Guanghua Lu, The Place, Chaoyang District (5206 1012)
朝阳区光华路9号世贸天阶北街1层
Images: TechNode, mi.com, Xiaomi Forum
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