Xiaomi In 2010, Lei Jun founded Xiaomi, an electronics company based in Beijing, China. The electronics company started as software and created MIUI ROM based on Google's Android. The idea behind building MIUI was to offer smartphone users more functionalities and a better User Interface (UI) than Android. In less than a year, the company got the popularity it deserved. In 2011, Xiaomi entered the hardware segment and introduced its first phone by launching the "Mi One Phone." Xiaomi positioned itself as offering quality technology at an affordable price. It is sold directly to consumers through its website. Because of the company's direct engagement with tech-savvy consumers, it created a significant cost advantage and increased the speed at which Xiaomi could reach its consumers. Demand outpaced production so much that the company could only open its e-commerce site one day per week, and stocks sometimes sold out within minutes. The constant and instant sell-outs led to social media storms, spreading the brand to an ever-wider audience, and stimulating further demand. After gaining a foothold in the tech-savvy, value-conscious segment in the top cities, Xiaomi began to expand into other segments less tech-savvy consumers and those living in smaller cities. Many of these consumers preferred an offline shopping experience, wanting to discuss their needs with a staff member or get a demonstration. Xiaomi built an offline retail infrastructure to serve these new customers, setting up hundreds of stores spanning major metros and small cities. Unlike other smartphone makers, Xiaomi set up its stores in locations with high foot traffic, like malls, where its new target consumers were likely to shop. Importantly, Xiaomi chose malls where existing high value at a reasonable price anchor stores could help reinforce its positioning. It also started offering different sub-brands (Redmi as an economical product line and Mi MIX for more advanced tech seekers), always ensuring that the features-to-price ratio of each new phone was more appealing than competing products. However, due to the Coronavirus pandemic, the smartphone company saw a decline in the first quarter of 2020. Despite the decline, Xiaomi has been declared the only brand among the top five (5) smartphone sellers to achieve comparatively sound sales in the first quarter of 2020. Xiaomi also intends to keep its focus on developing 5G smartphones and thus improve its position in the premium smartphone segment. Questions (4 items x 5 points): 1. What are some of Xiaomi's greatest competitive strengths? 2. In your opinion, what other attack or defense strategy could help Xiaomi expand its market share internationally? Explain. 3. Aside from the Coronavirus pandemic, what do you think are the potential challenges that could halt Xiaomi's globalization? 4. Compared with other smartphone brands, is Xiaomi a cloner, imitator, or adapter? Justify your answer.