This is in conjunction with "Analysis of Consumer Preferences for New Smartphone" uploaded earlier. It showcases a detailed marketing plan for a new product in smartphone category.

1. 8/29/2016 Marketing Plan for MI-“Z”
Report
Tushar Sharma, Utkarsh Mishra, Akriti
IMT GHAZIABAD

2. Contents
Executive Summary................................................................................................................................2
Mission Statement .................................................................................................................................2
Company Objectives...............................................................................................................................2
Short-term:.........................................................................................................................................2
Long-term: ..........................................................................................................................................3
Sustainable Advantages.........................................................................................................................3
Situation Analysis...................................................................................................................................3
SWOT Analysis....................................................................................................................................3
Strengths:........................................................................................................................................3
Weaknesses:...................................................................................................................................4
Opportunities: ................................................................................................................................4
Threats:...........................................................................................................................................4
Industry Analysis ....................................................................................................................................4
Competitor Analysis...............................................................................................................................5
Customer Analysis..................................................................................................................................6
TARGETING STRATEGY ...........................................................................................................................7
KEY PRODUCT/SERVICES ATTRIBUTES AND BENEFITS..........................................................................7
SUSTAINABLE ADVANTAGES..................................................................................................................7
The Target Group....................................................................................................................................8
The Approach .........................................................................................................................................8
Launch Ideas...........................................................................................................................................8
ATL Activities ......................................................................................................................................8
TTL Activities.......................................................................................................................................9
BTL Activities ......................................................................................................................................9
References............................................................................................................................................10

3. Executive Summary
MI is preparing to launch a major new state of the art multimedia smartphone, the MI-“Z”, in a mature
market. We can effectively compete with many types of smartphones because our product offers a
unique combination of advanced features and functionalities at a very competitive value added price.
We are targeting specific segments in the consumer and business markets, taking advantage of the
growing interest in a single powerful but affordable device with extensive communication,
organization and entertainment benefits.
Mission Statement
Xiaomi Inc. has had an exciting, and lucrative, start since its founding in 2010. In a little over four
years, the company has become the third largest smartphone distributor in the world and has
grown to be the world’s most valuable technology start-up; it is currently valued at around $46
Billion. Xiaomi is primarily known as a hardware company, but its leaders claim that the company
is more of an internet and software company. The company’s mission statement is as follows:
“At Xiaomi, we strive to create the highest quality products at the lowest possible prices in order
to provide people access to the necessary tools and services that connect them to the world and,
ultimately, their dreams.”
The mission statement for Xiaomi reflects the three key values that the company emphasizes:
1. A premium product: Xiaomi ensures that its products not only meet market industry standards
but also exceeds them. The products they make are second-to-none and can compete with any
of the higher end brands that competitors offer.
2. Lowest prices: The focus on producing great products is matched only by the emphasis on
providing products at incredibly low prices that normally wouldn’t be offered for such premium
items.
3. More than just hardware: Xiaomi’s outlook on what type of company it is strays from what a
conventional hardware company might have for itself; Xiaomi envisions itself as an internet and
software company above all else. The company wants to bring the internet, and all its uses, to
markets where smartphones are only just starting to flourish.
Company Objectives
Xiaomi’s tremendous growth in China has made them one of the most successful companies’ in
recent memory, but the company must look towards other markets in order to continue to grow.
Apart from expansion, the company also has several other objectives that it wants to focus on in
both the short-term and the long-term.
Short-term:
1. Further develop the Indian Market: In July of 2014 Xiaomi entered the Indian market with
massive demand. The company wants to be able to control the sale of its products online so
it plans on building its own online platform for the Indian market.
2. Expand manufacturing capacity: In order to keep up with demand, Xiaomi plans to increase
the supply of its product in order try and keep up with demand. The company did not expect
such an explosive demand in India, thus it did not properly increase its production capacity
prior to entering the Indian market.

4. 3. Bring all of its core products to India: While Xiaomi has introduced its smartphone line to India,
the company plans on bringing in the rest of its suite of products to the country as well. The
company wants to bring in its tablet, TV, set-top boxes, and router products to India as the
country is a great opportunity for the business to expand internationally.
Long-term:
1. Home Tech/Internet of Things: Xiaomi has begun investing in Midea, a Chinese appliance
maker, in hopes to potentially break into the “Smart Home” market that continues to grow.
The company plans to increase its product portfolio outside of just smartphones, TVs, and
routers, which are its current main focus.
2. Enter developed western markets: The biggest future challenge Xiaomi faces will be breaking
through to western consumers, but it plans on trying nonetheless. The company realizes that
western markets will have to be handled far differently than they have with their current
markets. Low prices will not be enough to entice shoppers that already buy highly subsidized
phones.
3. Increase software portfolio: Xiaomi considers itself a software company more than a
hardware company and is why it plans to continue to grow its software line. The company has
bought stake in Chinese software company KingSoft Corp. and plans on investing future
capital in similar software companies.
Sustainable Advantages
In totality Xiaomi shines as an innovative tech company for two crucial reasons:
1.) Its online sales business model and
2.) The method in which it improves its phones through user feedback.
Situation Analysis
Xiaomi, founded 6 years ago by eight partners, is in a want to launch a new phone in a highly
competitive smartphone market. Multifunctional cell phones are increasingly popular for personal and
professional use, with more than 1.9 billion smartphone shipments in 2015 and 100 million in India .
Competition is increasingly intense as technology evolves, industry consolidation continues and
pricing pressure squeezes profitability. To gain market share in this dynamic environment MI must
carefully target specific segments with valued features and plan for next-generation product to keep
brand momentum going.
SWOT Analysis
In order to truly understand Xiaomi and its business model’s success, we must understand its
main core strengths, weaknesses, opportunities, and threats.
Strengths:
1. Xiaomi's model of vertically integrating hardware and software is a core strength of the
company, as it provides a common, high quality experience for all users across a range of
Xiaomi devices.
2. Xiaomi's direct sales of devices to customers through their online store reduces overhead
costs as it cuts the number of "middle men" involved in their sales chain. Xiaomi is one of the
few companies who have successfully adopted this model in a way that is both sustainable
and lucrative, and as such it is one of the biggest internal strength of the business.

5. Weaknesses:
1. Xiaomi has extremely limited capacity in manufacturing. The company outsources all
manufacturing of its devices to Foxconn, a Chinese factory. This not only increases the
potential risk that Xiaomi faces in basing their supply and manufacturing chain in a single
partner, but also limits the manufacturing capacity of the company.
2. One of the key aspects of Xiaomi's supply chain is that it purchases different device
components (such as camera imaging sensors and touch screen modules) from a number of
other business. Instead of spending an increasing amount of money on R&D, Xiaomi obtains
its best-in-class components from specific companies.
Opportunities:
1. Xiaomi's financial performance can be credited to the previously untapped potential of the
emerging Chinese market. This success can be reproduced in other developing nations in
which the demand for high quality, and yet cheap smartphones is increasing.
2. Evaluated at $46 Billion, Xiaomi has many financial opportunities. The ease in which it can
acquire further funding from investors, in addition to its skyrocketing financial performance
bringing about $12 Billion dollars in annual revenue in 2014, allows Xiaomi to be a financially
flexible company equipped with the necessary tools to scale with sustainability and speed.
Threats:
1. Xiaomi's direct sale, although unique in success at the moment, can be easily replicated by
bigger competitors with large cash reserves that can afford to lose money initially to perfect
their online sales model.
2. Large patent portfolios of Xiaomi's competitors, in combination of Xiaomi's own limited
number of patents, impose an additional threat to the company.
Industry Analysis
The smartphone industry has grown exponentially since the introduction of the original iPhone in
2007. Since then, Google’s Android OS has become Apple’s main competitor. Android is provided to
phone makers for free, and has become the main driving force of the smartphone’s industry growth
(as seen on the graph to the right). As such, Android (including its many variants, such as the one
developed by Xiaomi) dominates the industry with a 51.5% of market share. The android platform is
dominated mostly by Samsung, which provides phones across a wide range of prices. Xiaomi emerged
to compete with all Android and smartphone manufactures with an innovative principle: Cheap, high
quality hardware. Xiaomi has then seen its market share skyrocket, and is now considered a strong
threat by its bigger rivals, who still build expensive, well performing devices. Another minor player in
the smartphone industry is Microsoft, who has acquired the mobile devices division of Nokia in 2014.
Microsoft develops the Windows Phone OS (which will soon be renamed to just “Windows 10 for
Phones” with the introduction of the new universal OS) and designs and sells the Lumia smartphone
line. Although Microsoft has not acquired any significant market share with its products (Windows
Phone currently has less than 5% of global market share, as seen above), the company have been
significantly increasing their mobile presence by producing extremely cheap smartphones and selling
them in developing nations, strategically focusing where demand is increasing.

6. This increase in demand for smartphones is global. Developing nations, such as India, Russia, and Brazil
have an ever increasing demand for both entry-level and mid-range smartphones. In these markets,
Apple has lost ground to both Android and Windows Phone as they offer solid performance at much
cheaper prices. Although Apple still has a market in these countries, it is selling devices at a much
slower pace than its competitors. In developed markets, like the United States and Europe, Apple has
a strong stand as their brand and products are much more established and are affordable by the
population. In these markets, Apple has been quickly gaining market share, while Android has been a
close second to Apple, and Microsoft struggles to have any meaningful share.
Competitor Analysis
In the competitive landscape, Xiaomi faces stiff competition from not only established companies
(like Apple, Microsoft, and Samsung), but also from both Chinese and Indian start-ups and small
companies that imitate Xiaomi's business model.
1. Apple competes directly with Xiaomi in the high end smartphone offerings. To compete with
the new iPhone 6 and iPhone 6 Plus, Xiaomi launched its Mi Note and Mi Note Pro, which
rivaled Apple's phone in features at approximately half the price. Similarly, Xiaomi's MiPad
competes with the Apple iPad.
2. Samsung competes with Xiaomi in both the middle- to high end of their smartphone
portfolios. Xiaomi's Mi and RedMi Note phones compete directly with Samsung's Galaxy S and
S Note lines at a much lower price point while offering customers the same features and
specifications.

7. 3. Microsoft competes with Xiaomi in the lower end smartphones offerings. Microsoft (after its
acquisition of the Nokia Mobile Devices division in 2014) designs and sells to the Indian market
extremely cheap Lumia devices that have a high degree of quality and performance for the
price.
4. Small Indian and Chinese businesses are in increasing threat to Xiaomi's business model.
Companies like Micromax (with its Yureka brand), Lava (with its Xolo subsidiary), and ZTE are
having success in both mimicking Xiaomi's business model (cheap, decent devices sold directly
to consumers online) and in acquiring market share in India.
Customer Analysis
In the past decade, the Indian government has taken an active role in improving the living
standards of the population through economic incentives and social programs. As result, the
Indian middle class is expanding extremely quickly, and with it so is the disposable income per
capita of the nation. The overall spending power of the Indian population is rapidly increasing,
and the new members of the middle class are creating an increasing demand for technological
goods, especially cheap smartphones with good specifications. As such, smartphone penetration
in India has more than doubled in less than two years, and are expected to reach 21.5% of the
population by 2018 (as shown in the chart above).

8. TARGETING STRATEGY
Following industry standards, the segments within the larger Indian market should be
segmented on the basis of four factors.
1. Economic Purchase Power
2. Technological Familiarity
3. Required Functionality
4. Intended Use
Using these guidelines, we have identified three major segments in the market.
1. Entry-Level Consumers: Members of the Entry Level segment consist of individuals located
in the lower socioeconomic classes of India. They possess low discretionary income to spend on
technology, yet they are eager to become tech-users. They prioritize pricing above all else, and are
willing to sacrifice technological capabilities of the device for cheaper prices. They are also
unfamiliar to technology, and due to their lack of knowledge towards the latest trends in
smartphones, they tend to be more responsive to advertising and other marketing strategies.
2. Mid-Range Consumers: This segment consists of the existing members of India's middle class
and individuals from lower classes who are moving to higher socioeconomic classes as a result of
the recent upward mobility that is sweeping the poorer individuals in India. There are
approximately 267 million individuals in this segment. These consumers want a reasonably priced
device and expect a plethora of features, and in some instances, even high end specs. These
individuals require consistent engagement as they have a multitude of options to choose from, and
building brand loyalty may be especially difficult in this segment as users will prioritize function
and price over brand and design.
3. High-End Consumers: This segment consists of consumers in the high middle class and higher
economic classes of India. Not only are these individuals extremely affluent, but they are also used
to utilizing technology and are accustomed to high end devices. Members of this segment prioritize
functionality and design over price, and may be more inclined to consume Apple products due to
their prestige and iconic symbolism among high net worth individuals.
KEY PRODUCT/SERVICES ATTRIBUTES AND BENEFITS
The products Xiaomi sells exemplify some of the highest quality products on the market for our
mid-range users target market. Xiaomi devices will provide the market with distinct attributes
defined by the following key factors: relative low price, technical features, and user experience.
SUSTAINABLE ADVANTAGES
The two sustainable advantages that Xiaomi will be able to leverage against its competitors are
their low prices and unique user experience. Since Xiaomi’s business model revolves around selling
their devices at extremely low profit margins they can maintain the sales price low as long as they
can cover their costs. This is a key ability that competitors cannot easily copy because it would
require that they completely restructure their business model. Additionally, the completely unique
user feedback system that Xiaomi incorporates within its weekly update process is something
entirely different from its competition. Because Xiaomi designs customized software that is
packaged with all their phones, they allow their customers to have a lot of input into the updating
process. Xiaomi’s update system allows users to feel empowered and gives them some say into

9. how their devices are improved both digitally and physically. This system uproots the traditional
relationship between business and consumer, where businesses usually have complete say into what
changes are made and when. Xiaomi’s system is unlikely to be imitated by most smartphone
manufacturers due to the limiting structure of traditional business-to-consumer communication
channels.
The Target Group
This marketing plan will focus on the mid-range device users as it will face too much competition
in the high end segment. These middle range users require high end specifications, such as
cutting-edge processors, latest features, and OS versions (described in a separate report). As
these users will most likely be a part of the upward socioeconomic movement in India, they will
want to believe they are getting the most out of the price they pay for their devices.
The Approach
1. Announce - Activation by installing pre-launch posters and standees at Mobile Dealerships,
Mobile Stores, Malls, Colleges, Institutes and other places .
2. Engage - Social Media contests - Start a Blogger Management Program for the build up so that
the Bloggers start talking about the new phone to be launched in the market. They can talk
about Tips and Tricks, Specs, Features, Price and other comparison with the competition brands
to create a buzz about the product
3. Promote - Social Media Campaigns and Sponsored Posts and Stories to promote the brand and
do a Fan Acquisition on Social Media Platforms like Facebook and Twitter
Launch Ideas
ATL Activities
1. We can host the smart phone via a review session with experts on the following programs
which has the maximum viewership in context of the content of the program. These are:-
a. Cell Guru by NDTV Good Time
b. Tech Guru by CNBC Awaz
2. Since the last sprint of paper advertisements fetched immense turn ups and created a
branding for the organization, we can initiate another sprint of paper advertisements
which can be decided by a particular day depending on the launch dates. This day should
be such that it creates maximum eye pops through a campaign that we would also run on
digital platform. (Campaign has been described in the following sections)

10. TTL Activities
1. Facebook & Twitter Campaign
a. #Loadthefirstvideo -> The campaign will ask the buyers to load the first video on the
day of purchase with a copy of bill specifying the date. One would also be required to
host a comment on the hashtag on twitter. This would promote the 4K resolution of
the screen and the clarity and sharpness of the camera. The winners would be
presented with some goodies or a dinner date with a known sportsperson/celebrity.
b. #Clickthefirstpic -> The campaign will ask the buyers to click the first pic on the day of
purchase and upload it on the campaign page created on Facebook. The winners
would be presented with some goodies or a dinner date with a known
sportsperson/celebrity.
2. YouTube Campaign The videos that would be uploaded on Facebook can be clubbed to
form a sequence containing video and first experience of the users through a random
interview. This can be uploaded on YouTube as a campaign which can be critiqued by
some tech guru or a well-known face.
3. We can host a display counter at malls in Tier 1 & 2 cities where the MI- “Z” would be
displayed playing 4K videos. They will also display the quick charging feature along with
other specifications. This can be clubbed with some random quiz rounds during the peak
visiting hours at the mall where we can distribute MI goodies in return. We can also create
a gaming contest to display the features of the product at our counters.
4. We can sponsor college fests that would enable us to extend a counter at the venue. This
can generate lot of awareness about the product. We should distribute MI friendship
bands which should look similar to MI band. This would enable parallel branding of the MI
accessories.
BTL Activities
1. Tech Blog- We can collaborate the popular tech bloggers such as gsmarena.com etc.
to host a blog for the product and host reviews and replies to the queries.
2. E-mail Marketing- Since we do have a huge customer base we can leverage it by
running an e-mail campaign. This would create awareness of the product and would
lead to the promotions as well.
3. SEO Plan- We can run an SEO optimization plan thorough keyword search, link building
and social networking.
4. We can run a digital campaign of pre-order/ first orders through initial rounds of flash
sale. These winners can be awarded with a new MI handset.

11. References
(1) http://economictimes.indiatimes.com/tech/hardware/india-pips-china-in-smartphone-sales-
pace-but-lags-in-volume/articleshow/52627757.cms
(2) https://www.idc.com/getdoc.jsp?containerId=prAP41033416
(3) http://www.adageindia.in/marketing/cmo-strategy/heres-why-xiaomi-needed-a-tv-
campaign-in-india/articleshow/52196768.cms
(4) http://indianexpress.com/article/technology/tech-news-technology/smartphone-sales-
growth-q1-2016-apple-samsung-oppo-2809375/
(5) http://www.channel5.com/show/the-gadget-show