Xiaomi has made quite a name for itself in China, but the company wants to continue its success internationally. After all, selling in your own country may be impressive (in the same way that Apple’s US sales are), but the recognition most revered is to respect and acceptance by those who are not one’s countrymen. It’s the reason why Apple branched out internationally when it struck a deal with China Mobile, and it explains the reason as to why Xiaomi wants to become more than just a Chinese brand.
In a Bloomberg interview involving Xiaomi’s Hugo Barra, Barra was asked about Xiaomi’s plans to enter the US smartphone competition race. Barra’s response was that Xiaomi will need “at least one year plus” before it looks to arrive in the US market.
“I would tell you if I knew, but I don’t. We don’t have like a set date yet. You know, selling phones is a huge marketing undertaking,” Barra said. He talked with Bloomberg about the massive after-market sales, customer support, and other workforce members that Xiaomi would have to put in place in order to come to the US in formidable fashion. Barra responded by saying that “we’re working towards that.”
When asked about intellectual property issues being one major reason why Xiaomi hasn’t yet entered the US market, Barra said, “It takes time…and secondly, we’re building our own portfolio of patents for defensive purposes, because you’ve got to kinda have that, think about it as a war chest of sorts. We’ve filed over 2,000 patents, which is actually a lot. We’re acquiring patents. That’s perhaps one of many factors that determines when we’re ready to enter a certain market.”
While Barra cites their large manpower workforce here in the US alongside of intellectual property/patent issues, there are some additional reasons as to why Xiaomi has yet to arrive in the US: 1) the Apple-Samsung duopoly, which shows no signs of slowing down anytime soon; 2) the Xiaomi brand; 3) the impact of Xiaomi on American culture and Xiaomi’s incorporation of American culture into its brand, which is distinctly Chinese (the name is a dead giveaway), among others.
After these factors, Xiaomi will also battle the fact that it’s name is Chinese and will be a turnoff to some American customers who can barely pronounce the company name. After all, “Samsung” and “Apple” are not hard to pronounce, but “Xiaomi” is a name that most Americans know little about (and those that do have had to Google for a pronunciation a time or two). Americans, like the Chinese, are nationalistic, and Apple appeals to a number of individuals not because its products are better than its rivals (Samsung, for example), but because it is distinctly American.
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With its distinctly Chinese name, Xiaomi will have to go the distance and convince Americans that Xiaomi is not just “built by the Chinese for the Chinese,” but that it’s a truly global brand. And, if Xiaomi needs any wise counsel in this, which any new company looking to enter the US market does, it need only ask Samsung, who’s had to battle the nationalistic fervor in the US to overtake Apple recently in marketshare sales in Apple’s native country. For Samsung, as is the case for any future company that tries to battle Apple, it won’t be easy. It’s possible, yes, but not easy.
Xiaomi can also consider the recent Google-Huawei partnership with the Huawei Nexus as an example. Huawei has never infiltrated the US market as a recognizable brand, so the manufacturer is teaming up with Google, an American brand with brand recognition, as a means to penetrate was has proven to be an impenetrable market. Xiaomi will have to do the same.
In the end, it all comes down to the consumer because it’s a consumer-based market. How will Xiaomi distinguish itself with a unique smartphone or mobile experience when it does arrive in the US? I think that above the issues of patent licensure, manpower, and money, which are all key to establishing a global brand, Xiaomi’s got to discover how it intends to set itself apart from the other rivals that have already set up shop in the US. If the recent past is any indication of truth, Motorola, LG, Sony, and HTC, among others, have failed in their efforts to topple Apple and Samsung. Nice leather/metal/plastic/glass build quality, some 13MP camera sensors, Quad HD displays, fingerprint scanners, and octa-core processors are now standard expectations for smartphones.
Xiaomi can make it in the global market, but the greatest challenges to the company’s success lie ahead. Good is no longer good enough, and that alone may be the largest factor behind the US market delay.