Date
20 September 2019
Xiaomi's Lei Jun promises to enhance his company's supply chain to meet the extremely strong demand for the Mi 9. Vivo, meanwhile, has launched the iQOO Monster (inset), which has similar specifications. Photo: Reuters/YouTube
Xiaomi's Lei Jun promises to enhance his company's supply chain to meet the extremely strong demand for the Mi 9. Vivo, meanwhile, has launched the iQOO Monster (inset), which has similar specifications. Photo: Reuters/YouTube

Mi 9 shortage may prompt Xiaomi fans to turn to Vivo’s iQOO

Xiaomi Corp. (01810.HK) launched what could be the hottest item in the smartphone market right now, the Mi 9. 

But it is facing a challenge from local rival Vivo, which has unveiled a new brand and a new model with almost the same hardware specifications as Xiaomi’s latest flagship device and – this must be part of the fun of competition – cheaper by one yuan.

Fans would probably prefer the Xiaomi device, but there is a shortage of Mi 9 supply in the market. Customers are starting to grumble about what they perceive as Xiaomi’s poor supply chain management, and they may soon turn to rival products.

Shortly after Xiaomi positioned the Mi 9 as a sort of Battle Angel in the market, the smartphone with a top-tier processor at the cheapest price – starting from 2,999 yuan (US$447.71) – Vivo launched the IQOO brand. iQOO’s first smartphone, the iQOO Monster, is equipped with Qualcomm’s Snapdragon 855 chip and a built-in 4000mAh capacity battery, just like the Mi9. The 6GB + 128GB version is priced at 2,998 yuan, one yuan cheaper than the Xiaomi flagship model.

However, iQOO achieved a higher score at AnTuTu, the Chinese software benchmarking tool – over 400,000 points – than the Mi 9, which only got 387,000 points.

The iQOO Monster will hit the market on Wednesday, just as Xiaomi is struggling to resolve whatever shipment issues it may be having with regard to its Mi 9.

It may be that Xiaomi underestimated the demand for its latest flagship smartphone, which is why fans have been having difficulties obtaining the units since their debut on Tuesday last week.

This is actually good news for Xiaomi. The flagship phone was sold out in just 53 seconds after it hit the online market.

But many fans accuse the company of resorting to “hunger marketing”, such as by deliberately curbing the supply of the product.

As fans were starting to get angry, founder Lei Jun pledged that if the supply fell short of one million units in its first month, he would personally go to the factory with a screwdriver to speed up the assembly line. Meanwhile, the shortage continues.

Xiaomi said the company has shipped large numbers of its latest model to meet the demand, but the stock is not only for online stores. Many have been shipped to Mi Home retail outlets.

The company has also teamed up with BYD to complement the Mi 9 production at Foxconn Technology factories. Lei Jun said BYD production lines were in full operation as of Monday, and this should help improve the supply situation.

Indeed, Xiaomi is doing its best to boost output to meet the extremely strong demand for the Mi 9. But how long Xiaomi fans would wait for their own Mi 9 remains a question.

For Vivo, Xiaomi’s predicament presents an opportunity. The company could take advantage of the Mi 9 shortage to step up the promotion of iQOO Monster.

Xiaomi believes the high-end image of its new flagship, along with its superb quality, will help strengthen and widen the company’s fan base.

However, industry observers say there is a huge room for Xiaomi to improve and narrow its gap with major rivals such as Samsung, Apple and Huawei.

One of Xiaomi’s pain points, for example, is camera quality. While the Mi 9 got a high score in the DxO mobile camera test, it is far behind Samsung and Apple in terms of user experience.

In some online discussion forums, it is said that Xiaomi may have the best hardware in the market, but it underperforms in terms of software and algorithm for photo processing.

In contrast, Vivo has established a solid reputation for the high quality of its phone cameras. This is putting more pressure on Xiaomi.

The iQOO also seeks to challenge Xiaomi’s wireless charging technology through Vivo’s Super FlashCharge. The technology supports a high 44W output, which can recharge a phone battery to 50 percent in 15 minutes, to 85 percent in 30 minutes, and 100 percent in 45 minutes.

Given that iQOO has similar or even better hardware specifications, Xiaomi is facing mounting pressure in the market. But first and foremost, it should focus on bringing its product to the market.

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CG

EJ Insight writer