Digital Theory: Will Xiaomi TV succeed in its forced entry into the high-end market?

In July this year, Xiaomi TV’s official Weibo account announced that data from Aowei Cloud Network showed that in the first half of 2020, Xiaomi TV ranked first in China in terms of shipments, and has remained in the top position for six consecutive quarters.

Xiaomi TV has achieved the number one result in China, which is enough to make Lei Jun and other management proud. You should know that Xiaomi launched its TV business in 2013. After five or six years, it finally succeeded in topping the Chinese TV market in the first quarter of 2019 and has led the way for six quarters.

In addition, Xiaomi TV also set a new historical record. In January 2020, two major research organizations, Aowei Cloud Network and Qunzhi Consulting, both confirmed that in 2019, Xiaomi TV's shipments in the Chinese market exceeded 10 million units, making it the first TV brand in TV history to exceed 10 million units in annual shipments in China, setting a new record in China's TV industry.

On Xiaomi TV’s report card, “No. 1 in China” and “creating new historical records” seem glorious, but it also hides a crisis, that is, the product urgently needs to be upgraded.

He Yang, a media person, once wrote an article to evaluate Xiaomi, saying that it has "no technical strength, no manufacturing strength, and no service strength." The downturn in the Chinese color TV market and the difficulties faced by color TV companies are largely due to the price war of Xiaomi TV, which "there is no lowest, only lower" has hindered the process of industrial transformation and upgrading, and even misled consumers about the choice of high-definition and high-quality TVs. Selling TVs directly as display screens has made Xiaomi TV a success, but it has dragged down the color TV industry.

Although He Yang's words are a bit exaggerated, they indirectly reflect that Xiaomi TV needs to make changes. In addition, competitor Huawei also puts a lot of pressure on Xiaomi.

Data on the Chinese TV market in the first half of this year released by Qunzhi Consulting showed that Huawei ranked eighth in the domestic TV market. It should be noted that Huawei only launched its first TV product in August 2019. It took less than a year to enter the top ten in China, which scared Xiaomi. The pain of losing to Huawei in the smartphone market made Xiaomi realize that Huawei's strength is unfathomable. If it loses to Huawei in the TV market again, it will be a bit difficult for Xiaomi to accept.

Image source: Baidu

Interestingly, before relevant institutions announced the shipment data of the Chinese TV market in the first half of the year, Xiaomi seemed to have the idea of ​​upgrading and transforming its TV business.

In May this year, Xiaomi announced a personnel appointment: Liu Yaoping, the former CEO of Baofeng TV, joined Xiaomi as general manager of the TV department. According to information, Liu Yaoping has experience in both traditional TVs and Internet smart TVs, and has been deeply involved in the TV industry for 20 years. He has served as vice president of Skyworth's color TV business unit and general manager of China marketing, and CEO of Baofeng TV.

In June this year, the official announced that Yang Zhe would serve as Xiaomi Group Vice President and Chief Marketing Officer (CMO) for China. He will be responsible for the formulation of marketing strategies, plan implementation, brand building and promotion for Xiaomi China. Yang Zhe is best known for his successful management of Samsung and Huawei's business model series, which earned him the nickname "Master Yang".

The joining of TV veteran Liu Yaoping and marketing guru Yang Zhe has aroused the outside world's imagination about the development of Xiaomi's TV business. As expected, in July, Xiaomi announced that its TV will impact the high-end market.

Xiaomi's first TV to hit the high-end market was the Master 65" OLED, priced at 12,999 yuan. Both the sound quality and the picture quality were first-class in the industry. Then, in August, the Xiaomi TV Master series transparent TV debuted, focusing on the future sense of technology, with a starting price of 49,999 yuan, which can be said to be one of the most expensive Xiaomi TVs currently. In September, the Xiaomi TV Master Supreme Edition was launched, integrating many epoch-making technologies such as 8K+5G and Mini LED display technology, priced at 49,999 yuan.

Judging from the three Master Series models of Xiaomi TV, Xiaomi's understanding of high-end TV is "three highs": high price, high configuration, and high technology. In my opinion, Xiaomi TV has initially acquired the ability to impact the high-end market, but it still needs to solve the following two problems:

1. User experience: Xiaomi TV has been criticized for its user experience. When Huawei (including Honor)'s smart screen TV product came out, the official directly hit the pain point of current TV products - TV power on and off ads, which quickly resonated with netizens. Among them, Xiaomi TV's power on and off ads were the most complained about.

If Xiaomi TV wants to gain a foothold in the high-end market, it is not enough to have products, the user experience must also match it.

2. Core technology: It is basically difficult to see Xiaomi’s core technology on its three high-end TVs, which means that other brands can also launch similar products. As long as they control costs or are determined to engage in price wars, Xiaomi will most likely be affected.

Regarding the fact that Xiaomi does not have core technology, netizens once made a joke: once Xiaomi's products are commercialized, it implies that the technology will be mature.

Huawei's entry into the TV market is supported by core technologies such as the Honghu chip and Hongmeng OS. What core technologies does Xiaomi TV have to impact the high-end market?

Image source: Weibo

On the road to the high-end market, Xiaomi TV will have to face not only traditional TV brands such as Sony, but also old rivals Huawei and OPPO, which will release TV products in October. The longer Xiaomi TV delays its entry into the high-end market, the more disadvantageous it will be, because it will face more and more competitors. It is not difficult to understand why Xiaomi has released the Master Series TV products for three consecutive months.