International Marketing Communication: Xiaomi Smartphone Brand launch in the UK (Essay Sample)

International Marketing Communication: Xiaomi Smartphone Brand launch in the UK
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Contents TOC \o "1-3" \h \z \u 1.0 Introduction PAGEREF _Toc426750371 \h 32.0 Contextual Analysis PAGEREF _Toc426750372 \h 32.0.1. Customer Context PAGEREF _Toc426750373 \h 32.0.2 Business Context PAGEREF _Toc426750374 \h 52.0.3 Internal Context PAGEREF _Toc426750375 \h 62.0.4 External Context PAGEREF _Toc426750376 \h 8Political PAGEREF _Toc426750377 \h 8Economic PAGEREF _Toc426750378 \h 8Social PAGEREF _Toc426750379 \h 8Technological PAGEREF _Toc426750380 \h 93.0 Summary of the Analysis PAGEREF _Toc426750381 \h 9References PAGEREF _Toc426750382 \h 11
1.0 Introduction
For several years now, Chinese products have been branded in the West. However, with the continued innovation of the Chinese brands, high-quality offerings have increasingly been produced, ensuring that brand leadership remains at the grasp of the Chinese. Several Chinese brands have proven to be successful by closing the existing gap between how consumers in different international markets perceive the Chinese brands and how the consumers also view global brands which are considered to be successful. Factually, Cendrowski (2015) suggests that Chinese producers and manufacturers are known to have a profound understanding of the desires and needs of the consumers in the market. This is based on the fact that the Chinese producers meet the desires and needs through leveraging experience gained through several decades of production to produce and market high product quality, which are also value-added under their own established brand names. Xiaomi, a Smartphone product brand has transformed from being termed as the iPhone owned by the poor people, to a technological brand which is not only disruptive and exciting. This paper outlines a contextual analysis part of a marketing communications plan for a Chinese Smartphone product brand, Xiaomi, to launch the brand in the UK.
2.0 Contextual Analysis
2.0.1. Customer Context
Despite the fact that the value terms and volume of smartphones have continued to grow in the UK, failure to have a significant innovation have contributed towards the replacement of cycle lengthening. A larger percentage of the smartphone manufacturers have majorly focused a considerate percentage of their productive efforts towards launching electronic products which are wearable in conjunction with the launch of smartphones. McCracken et al. (2015) implies that this is a way of ensuring the new customers in the market are enticed towards upgrading their phones, in opposition to reinvigorating the actual phone features. However, a considerate percentage of the market still values the old trend where all their desirable features within a smartphone are still available on a single device.
Moreover, it is also a fact that the demand for smartphones in the UK is on the rise. This is evident as Olson (2015) posits that the rate of sales for the large-screened smartphones is increasingly on the rise showing the huge appetite for the big smartphones such as the Xiaomi. Evidently, new data reveals that phones which are larger than 4.9 inches have accounted for approximately quarter of the sales made during the first quartile of the 2014 financial year. In support of this, "Xiaomi pilots unboxed & refurbished smartphone retail model with Overcart," (2015) indicates that a dramatic rise has been reported in the proportion as well as the number of sales made of smartphones with screen ranging between 4.9 inches and above in comparison to the sale of the iPhone 4 and 4S which are known to be 3.5inches as well as the iPhone 5, 5S and 5C which are known to be 4 inches. Evidently, the Xiaomi smartphone is known to be 5 inches which meets the preferences of the UK smartphone customer expectations.
The outlined data shows by fact that the UK smartphone market is dominated by a growth in consumer interest of large smartphones. Olson (2015) supports this further by indicating that shipments of smartphones with a screen of over 4.9 inches has continually increased from 7% during the first quarter of the 2013 financial year to 23% during the same financial period of the 2014 year. Moreover, a general decline was noted on the number of smartphone sales with a screen measurement of less than 4.2 inches. This includes all android phones as well as iPhones from 62% shipments during the first quarter of the 2013 financial year to 48% during the same period in the 2014 financial year.
The graph below outlines the customer trends in the UK for the large-screened smartphones.
Source: Olson (2015).
The customer segment in the UK for the Xiaomi product brand is mainly composed of individual aged between 16 and 60 years. This is prevalent as "Mobile Phones Industry Profile: United Kingdom”, (2015), reports that the take-up of smartphones in the UK has rapidly increased during 2013 with half of adults in the region owning a smartphone being estimated at 51% of all the mobile phone users in the region. Only 11% of individuals aged between 65 and 74 own a smartphone in the UK with a limited 2% of persons aged over 75 years.
2.0.2 Business Context
There are several major players within the smartphone industry in the UK which the Xiaomi smartphone is likely to go against. According to "Xiaomi plans R&D centre in India, Bangalore may host local centre for 'Apple of China'”. (2014), Samsung electronics limited, available in the UK, has continually lead the mobile phone business in the region through out 2013. This company recorded a 34% market share during the 2013 financial year, a percentage obtained through the business’ increased sale of smartphones. Samsung Electronics lead the smartphones category with a recorded 35%volume share during the 35% volume share. The company has achieved this through increased advertisements as well as promotional techniques of its available handsets which have been positively received within the UK smartphone market. Factually, the company’s S3 and S4 models have been positively adopted by the market contributing towards the company’s huge success. This is regarded as the major player forming a competitive business landscape that the Xiaomi brand will be up against within the UK market.
2.0.3 Internal Context
An internal analysis is also referred to as the SWOT analysis. This plays a considerable role in identifying the strengths and weakness which an organization faces. Looking at the strengths of Xiaomi, it is evident that the company’s brand is continually growing as a result of its implemented innovative online selling model. Prevalently, the model has acted in the benefit of the company and its brand with more benefits likely to be noted as the company extends its brand into the UK (Maiwen and Dan, 2014). As it is, the model will allow the Chinese brand to sell within the UK smartphone market without any financial constraints hence contributing towards the brand’s stronghold in the region. Pandey and Nakra (2014) implies that Xiaomi also implement stringent marketing promotion techniques forming a basis of the strengths that the company faces. Evidently, the company has adopted social media market which is a trend that is continually being adopted in the UK. As a result, a larger percentage of the target market will be reached during promotion, meaning that the company is more likely to sell its products in the UK against the competitors.
The major weakness facing Xiaomi brand is the fact that the competitors within the UK market have already taken a front row when it comes to offering superior quality smartphone products, such as the S3 and S4 products offered by Samsung (Liao and Hsieh, 2013). This means that the Xiaomi brand is not likely to survive within the UK market as the consumers in the region will prefer purchasing the superior competitor products other than the Chinese brand.
One of the opportunities which Xiaomi faces is the fact that the UK market is characterized by a larger percentage of consumers who prefer the large screened smartphones with over 4.9 inches. According to Einhorn, Shrivastava and Lee (2014) this is considered an opportunity for the brand to sell in the UK market as the screen of the Xiaomi smartphone brand is known to be 5 inches. This means that the chances of having the brand survive within the UK market after its launch is considerably higher as it fits within the larger screen sized smartphones purchased by the customers in the region.
Local competitors such as the Samsung Electronics Limited available within the UK smartphone market forms a basis of the threats that the Xiaomi brand is likely to face in the region. Evidently, the competitor is known to be successful within the UK market meaning that it has already established a strong base or customer stronghold in the region. Therefore, the Chinese Company is likely to face several difficulties convincing the UK customers to purchase the Xiaomi brand other than that of the local competitor.
2.0.4 External Context
A PEST analysis framework plays an important role in outlining the external factors likely to affects a business’ brand.
Political
Being a Chinese brand, there are several political factors likely to affect Xiaomi as it enters the UK market. Imposed tariffs and trade barriers are some of the political factors for the brand to consider in this case. According to Vella (2015), the UK is known to protect its local producers as well as employment through tariffs and trade barriers by increasing the prices of imported commodities in the region. This will discourage the UK customers from purchasing the Xiaomi brand as a result of its high prices hence protecting the overall UK economy. High taxes are also a political factor likely to affect the Xiaomi brand in the UK.
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