Image cropped off Flipkart.com

Xiaomi’s “Drip Sales” strategy in India

A brilliant Sales & Marketing strategy with the Mi3

Xiaomi Mi3’s Drip Sales Strategy

So far Xiaomi has sold only about 35,000 units of it’s flagship smartphone the Mi3. This in itself is not an impressive sales figure. What is very interesting is the way they went about selling it…

Most handset manufacturers can’t wait to flood the market with their offerings. The launch is talked about for about a week or so, and then the handsets are soon out of sight in the public mind.

Xiaomi took a different approach. They got their best selling handset & priced it well below their competitors.

They then restricted their sales to ONE exclusive online sales partner, and arguably India’s largest online store, Flipkart.

Citing cautiousness as the reason, Xiaomi then held 3 weekly flash sales (so far) starting 22nd July, with quantities of 10K, 10K & 15K units respectively. For each flash sale the desirous buyers had to register afresh.

Every Mi3 flash sale got talked about for the duration of the week across print & online media. This is much more press coverage than any other handset launch in India till date!

The next flash sale is set to be held again after a week’s gap on 12th August.

Flipkart’s benefit

Flipkart couldn’t have paid enough to get this kind of traffic to it’s online store. During two of the flash sales, the Flipkart website crashed soon after Xiaomi’s Mi3 went on sale!

During each visit the prospective buyers get introduced the wide array of goods available at Flipkart. This traffic comes pre-qualified with disposable income as they can definitely afford the list price for the Mi3. Some frustrated buyers do go in for substitute products too.

Xiaomi’s benefit

With it’s drip sales strategy, Xiaomi has managed to achieve BOTH Marketing objectives as well as assure a solid demand for Sales.

On the Marketing front, no handset company could have hoped for a better launch! The brand has top-of-mind recall with the Indian smartphone buyer, and is being talked about both offline & online leading to a lot of word-of-mouth publicity as well.

Everyone in India’s cities has by now heard of or read about Xiaomi. This strategy has also positioned the brand as one that Indians desire to own thanks to how difficult it is to get an Mi3 handset. Other Indian brands have had to spend millions in traditional marketing to generate the same kind of desirousness!

This difficulty in acquiring a handset has also played in favour of Sales by creating a HUGE demand assuring good sales for the handset. The volumes will no doubt work to increase profitability initially lost on lower initial pricing.

Customer benefit

While it may be hard to see any customer benefit in this strategy, it is evident that the initial owners get to own an almost exclusive product for a lot longer.

Small quantities of 10-15K units will take long to satiate the demand which as per registrations is about 200K. Even then, when spread across India’s cities, one will not come across an Mi3 owner too often.

CONCLUSION

Xiaomi Mi3's innovative “Drip Sales” strategy has provided a Win-Win offering to all involved from the Manufacturer to the Seller to the Customer.

It has helped position a relatively unknown (in India) Chinese brand as one of the top talked about & sought after in the country.