Marketing Strategy Of E Commerce Essay

Marketing Strategy Of E Commerce Essay

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Xiaomi has shocked the world with their ability to sell high quality, high tech phones for so cheap, but it all comes down to their pricing strategy. Xiaomi’s pricing strategy is based around not having any brick and mortar stores. This reduces many potential costs for them, such as distributing to different stores and wages for employees working in stores. Another surprising strategy that they have found great success in is that they put very little investment into advertising, if any at all. They rely solely on social media and word of mouth to sell their products, and they have built a very large social media following. With no advertising costs and no store location costs, Xiaomi can sell their products for a very low price, but still see a significant profit because of their low costs.
"We are an e-commerce company. We live on the internet. We are selling exclusively through e-commerce. And the price there can be much lower, because the price on e-commerce is essentially fulfillment and shipping cost." This has been their strategy all along and it has paid off for them because they are one of the largest smartphone manufacturer in China. Xiaomi also relies on offering products outside of its phone hardware, “selling apps, games and special Android themes and Internet services on top of its custom MIUI - a pricing strategy very well-adopted by the e-commerce behemoth Amazon” (Kumar, 2014).
The pricing strategy established for the South African market is based on the data that shows the middle class in South Africa is large and there is a respectable number of people with high incomes. These are the people that can easily afford certain types of Xiaomi products while also being aware of the technology trend that the entire wor...


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...where Xiaomi usually holds its public relations events. For example, event called Mi Fan Festival was held in 2014 where Xiaomi celebrated its 4th anniversary and where Xiaomi organized its biggest flash sale ever. In earlier years, Xiaomi has traditionally launched a new product on the day itself. In this festival, Xiaomi started to stir up excitement in social media and increased the amount of engagement among its fans when Xiaomi implied taking Xiaomi-mania international. To do this, it was very helpful for Xiaomi that it had a huge following base in Weibo, where Xiaomi had over 8 million followers together in its main device account and its CFO Lei Jun’s account. In addition, Xiaomi used couponing at this festival as a sales promotion method when Xiaomi launched a game called King of Knockout where users could play the game and win discount coupons (Hong, 2014).

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