In recent days, there have been many people who have followed the situation in Russia and Ukraine.
After the Winter Olympics, the situation in Russia and Ukraine occupied the hot search position of every social platform almost instantaneously. Attracted by such "world-class" hot events, a group of melon-eating netizens also have more understanding of Russia and Ukraine, two "familiar and unfamiliar" countries.
As we all know, since the "Crimea" incident, the relations between Russia and Ukraine have always been very tense, but they have never been so tense in the past. However, as the old saying goes, if a string is too tight, it will break one day. Some time ago, Putin signed orders recognizing the "Donetsk Republic" and the "Luhansk Republic," which completely intensified the contradictions between the two countries.
Overnight, two unaccounted for independent regions of unknown ownership appeared in the world, something that was unheard of. Even domestic netizens are also ridiculing that the most deeply injured in this incident is the Chinese men's football team, after all, the ranking of the national football team has to drop by two places.
In the face of ridicule, the situation in Russia and Ukraine remains highly tense. This morning, after Russian President Vladimir Putin announced special military action against the Donbass region of Ukraine, the Verkhovna Rada (Parliament) of Ukraine passed a decision to enter a state of war emergency throughout Ukraine. The Russian blitzkrieg operations instantly dragged Ukraine into the quagmire of war.
What everyone did not expect was that in this "blitzkrieg" launched by Russia against Ukraine, the most brutally "injured" was actually the domestic manufacturer Xiaomi. According to Xiaomi's official social account in Ukraine, Xiaomi originally planned to hold a local launch of Redmi Note 11 in Ukraine today, and warmed up for the arrival of this product in a comprehensive way.
In this regard, Zang Zhiyuan, marketing director of Xiaomi's international marketing department, can only spit bitter water on Weibo, no matter how well planned in the early stage, it is still unable to catch up with the changes after all.
For this accident, netizens showed sufficient curiosity. Just click on the comments section of this Weibo and you'll find that curious rice noodles have taken over here. What is the mobile phone market in Ukraine, which has been in turmoil for a long time? As a domestic mobile phone manufacturer, Xiaomi actually has business in Ukraine?
Mobile phone market in Ukraine
In fact, the origins of Ukraine and mobile phones may be more profound than we think.
On April 3, 1973, Martin Cooper, one of the Motorola engineers who developed the first mobile phone, made the first mobile phone call in downtown Manhattan, announcing the birth of the world's first mobile phone, the DynaTAC, a Jewish immigrant from Ukraine.
Despite its deep roots, it was not until 1992 that the first mobile operator "Укра нський моб льний зв'язок", one of the three major operators in Ukraine today - Vodafone Ukraine.
The emergence of this operator officially opened the prelude to the Ukrainian mobile phone market.
In the years that followed, mobile phones were extremely rare in Ukraine due to their high price, arguably the prerogative of parliamentarians, bankers, wealthy businessmen and members of criminal gangs. Even in 1996, the relatively reasonable price of motorola StarTac was listed in Ukraine, but due to the problem of call tariffs, the ordinary Ukrainian people still had no connection with mobile communications.
For Ukraine, an important stage in the development and popularization of mobile communications was in 1999. In the year, Mobile Ukraine launched the first starter package with prepaid tariffs, and it was from then on that the further growth of the number of users began.
The following year, Nokia's legendary product, the Nokia 3310, officially landed in Ukraine. Compact body design, durable product quality, enough cheap package tariff. Thanks to various factors, the Nokia 3310 has achieved great success in Ukraine, although the product itself has nothing revolutionary except simplicity, reliability and durability.
In the next few years, the Ukrainian mobile phone market is still evolving, Nokia, Siemens, Motorola and other overseas brands have shined in Ukraine, Nokia 3310, Siemens A60 and Motorola RAZR V3 became the labels of that era.
At the same time, Ukraine itself is also actively conducting relevant tests of domestic mobile phones. In 2004, Ukraine's first domestic mobile phone was born, although the developer Rostislav Bosenko is very confident in this product, but from the actual design point of view, this product has lagged far behind the mobile phone market at that time, there is no screen, the old shape of this product, and finally does not seem to appear on the market, but directly disappeared in the long river of history.
In 2006, which can be considered the beginning of the transition from semi-smartphones to smartphones in the Ukrainian mobile phone market, the HTC P3300, alias HTC Artemis, was introduced to Ukraine. Although only businessmen and professionals at the time would buy such expensive products, the advent of this product did make more and more Ukrainians begin to be exposed to the concept of smartphones.
The following year, the iPhone was born. This product, which combined the most advanced, successful and convenient technology at that time, not only changed people's concept of mobile phones at that time, but also showed the future development direction to other mobile phone manufacturers, driving revolutionary changes in the entire market.
In fact, the iPhone has never been the most popular phone in Ukraine because it is too expensive, but the birth of the iPhone has really made many manufacturers aware of what products users need. In the following years, thanks to the Android revolution set off by Google, a large number of emerging mobile phone manufacturers entered the Ukrainian mobile phone market, and a large number of reasonably priced smartphones quickly emerged on the market.
One of the most popular manufacturers is Xiaomi.
Soaring millet
In the third quarter of 2016, Xiaomi announced its entry into the Ukrainian market.
Xiaomi's first "weapon" into Ukraine was the Redmi 4A released in The country at the same time. As an entry-level product, the machine is equipped with a Qualcomm Snapdragon 425 processor, with 2GB of storage, 16GB of storage space, equipped with a 5-inch large screen on the front, using a metal back cover design, the price is only 2099 hryvnia, that is, about 450 yuan.
So where exactly is this price? For comparison, the Samsung Galaxy A8, also launched in 2016, is priced between 6500-12000 hryvnias according to storage configurations, which is about 1400-2500 yuan.
With its super cost performance, Xiaomi has developed rapidly in Ukraine. According to Canalys' statistics, less than a year after entering the Ukrainian market, Xiaomi already has eight official authorized stores in the local area and has more than 20,000 loyal rice noodle community audiences. Two years after entering the Ukrainian market, Xiaomi's market share reached 26.7%, and won the sales champion in the Ukrainian market, and since then, Xiaomi's mobile phone sales have been at the forefront.
The question is, why Xiaomi's cost-effective tactics can work, I personally think there are three main reasons.
First of all, ukraine's economic level is relatively average. According to official data, in the whole of 2020, the nominal GDP achieved by the whole society of Ukraine is about 4.194 trillion hryvnia, equivalent to 155.2 billion US dollars, and the per capita GDP is only more than 3000 US dollars, and the per capita consumption income. Obviously, the national economy of Ukraine is still in the ranks of low-middle-income countries, and the economic level is not high.
Secondly, Ukraine's disposable income is not much, according to relevant statistics, the average wage level in Ukraine is about 8700 hryvnia, equivalent to about 2500 yuan. In contrast, the average wage level on the mainland is around 4100 yuan, and the gap between consumption levels is not small, so there are only a very few Ukrainians who can afford high-priced flagship mobile phones.
Second, Ukraine's communications infrastructure is not doing well. To this day, the main communications network covering the whole territory of Ukraine is the 4G network. According to a statement by Alexander Komarov, president of Kyivstar, Ukraine's largest operator, will not have the possibility of achieving 5G networks until the end of 2022, and 5G networks may focus on business needs and will not be accessible to ordinary people at all.
Now let's take a look at it, it is not difficult to find that a variety of Xiaomi's main products, including Redmi 9 and Redmi 9A, are not only lower in price than the same price products of Samsung, Motorola and other manufacturers, but also have better hardware configurations and very prominent cost performance. Not only that, these products can generally only use 4G networks, which can be said to be a perfect fit for the Ukrainian market environment, and it is no wonder that Xiaomi can be so smooth in the Ukrainian market.
Interestingly, in addition to Ukraine, Russia is also one of Xiaomi's main markets overseas.
According to Russian media reports, xiaomi's products were quite famous in the minds of local consumers long before officially entering the Russian market. Just like we bought parallel goods products, Russian consumers at that time would also buy Xiaomi smartphones, tablets, notebooks and other products through various informal channels.
In June 2016, Xiaomi officially announced its entry into the Russian market. In April of the following year, Xiaomi held its first official press conference in Russia, and officially released three mobile phones of Xiaomi MIX, Xiaomi Note 2 and Redmi 4X at the meeting, which also became the first step of Xiaomi's high-end products in overseas markets.
In the fourth quarter of 2020, due to the second wave of COVID-19 in Russia, the share of online shopping in the market continued to rise, and Xiaomi, which is the main online market, successfully surpassed Samsung in the Russian market, with a staggering market share of 31.4%. According to the survey statistics of Russian e-commerce giant Yandex, Xiaomi has become the most popular smartphone brand in Russia in the past 4 years.
Nowadays, Xiaomi mobile phones have become the favorite brand of many European users. In the documentary "Greatly Damaged My Country" broadcast by CCTV, we can even see passers-by and foreign guys specializing in the work of xiaomi mobile phones for domestic residents, and the charm of xiaomi mobile phones overseas can be seen.
Where is Xiaomi's overseas strategic road
As mentioned above, Xiaomi's overseas strategy in the early stage is actually very simple and easy to understand. That is, with Lei Jun's magical appeal in the industry, seize the pain point of pursuing "cost performance" for the market, use various marketing means to expand influence, and finally successfully capture a large number of "rice noodles".
However, behind the high popularity, Xiaomi's overseas development actually has some problems. According to IDC's survey, in recent years, because the domestic mobile phone market tends to saturate, domestic smartphone brands are expanding overseas markets. For example, OPPO and Realme have entered the European market strongly, while vivo is also eyeing this piece of fat meat.
According to Data from Counterpoint Research, OPPO, Realme and Vivo all achieved very good growth in the European market last year. With favorable prices, realme has successfully laid its foundation in the European market, especially in Eastern Europe (e.g. Poland, Czech Republic, Ukraine) and price-sensitive Western Europe (e.g. Italy, Greece and Spain).
In addition to the increase in competitors, Xiaomi itself also has the problem of low product profits. According to aliExpress Russia's statistics, Xiaomi's products have successfully occupied seven seats in the list of best-selling models in Russia, of which Redmi Note 9, Redmi 9 and Redmi 9A are the models with the highest shipments, and other products are also typical cost-effective products.
Judging from Xiaomi's recent financial report, although the entire group is still adhering to the "high-end route" without wavering, the profit margin of smart phone products is declining. Considering Xiaomi's product strategy in China in recent years, the profit margin of a single product is obviously dragged down by overseas products that focus on cost performance, and how to solve the contradiction between market share and high-end products is a major problem that Xiaomi urgently needs to solve.
After more than a decade of development, the smart phone market has obviously fallen into a period of low new rate, and how to develop overseas is what mobile phone manufacturers value now. For Xiaomi, the biggest problem now is how to steadily promote the sustainable development of overseas markets in the face of more competitors, while improving its own brand image and brand value, so as to successfully enter the overseas high-end market and enhance the profit margin of its products.
Maybe one day, we can really see the domestic flagship King's Landing overseas market.
Some of the information refer to:
《In d Nokia to iPhone – page I mobile phone in Ukraine for 30 years in independence 》
《The first mobile phone in the production》