Xiaomi CEO considers an increase in prices to shake off the “cheap” from the brand

Xiaomi CEO considers an increase in prices to shake off the “cheap” from the brand
Xiaomi’s smartphones are praised by many for their unbeatable value. Models of the brand are often around two times cheaper than competing brands for similar specs. However, there will always be people that associate low prices with low quality and it seems Xiaomi wants to do something about it. Guess what that is!

The company’s CEO, Lei Jun, said during a Q&A session recorded by TechNode that prices of future phones might be higher than what the company’s user base is used to. 


Apparently, the executive is concerned with the aforementioned association that comes with cheaper devices, saying: 

Actually, we want to get rid of this reputation that our phones cost less than RMB 2,000. We want to invest more and make better products.

RMB 2,000 is roughly equal to $300, which is now more than ever on the lower end of the smartphone price spectrum. The CEO was quick to clarify that the eventual increase would not be significant:

I said internally that this might be the last time our price will be under RMB 3,000… In the future, our phones might get more expensive—not a lot, but a little more expensive.

The price he mentioned is about $450 and refers to that of the Mi 9, which launched in China at 2,999 RMB. We’ve seen over the past year or so that most other manufacturers are raising the prices of their flagships to make them even more premium. It seems Xiaomi will follow suit, although it will likely remain a few hundred dollars below the competition.

The CEO’s statement isn’t very surprising considering last year Xiaomi separated its Redmi brand as the budget-oriented one (as it was known anyway). In the future, we might see the price gap between the two brands widen, with Xiaomi getting closer to Huawei in terms of pricing. The two companies are China’s biggest smartphone makers right now and are both gaining market share at a fast pace. However, Huawei’s marketing efforts have successfully gotten the company close to Samsung in the way customers perceive it, while Xiaomi is still looked at as an Apple knock-off by many.

Of course, a rise in prices will also help with the need for higher profits that Xiaomi, which went public last year, has to bring to its shareholders to keep the company’s value high. Hopefully, the Chinese manufacturer will follow through with the promise to use the increased cash flow to make even better phones or its loyal fans might quickly find a replacement.

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18 Comments

1. umaru-chan

Posts: 332; Member since: Apr 27, 2017

A don't see any problem with it. Redme and poco as the cheap brand and mi is the premium brand. But they should also bring even higher quality material for mi brand. Honestly xiaomi is the #1 android brand for me. They are now both innovative and aggressive.

5. Phonehex

Posts: 723; Member since: Feb 16, 2016

Miui is their biggest downside.

14. worldpeace

Posts: 3091; Member since: Apr 15, 2016

LineageOS is an easy fix for that.

10. epdm2be

Posts: 815; Member since: Apr 20, 2012

"...They are now both innovative and aggressive...." You realize we're talking about the company that started the trend of creating iPhone knock-offs? I fail to see the innovation in cheaply copying your most successful competitor. As for "Aggressive". You probably mean aggressive greed. Because the true reason is in this sentence: "a rise in prices will also help with the need for higher profits that Xiaomi,". If you already make big profits then why would there be "the need for higher profits". Or in other words; When is enough enough?

15. worldpeace

Posts: 3091; Member since: Apr 15, 2016

Right, they also copy sliding phone (Mi Mix3), on-screen FPscanner and double foldable phone from Apple, they also include fast wireless charging out of box, just like iPhone. /s

2. notfair

Posts: 680; Member since: Jan 30, 2017

it's called greed. why bother to invent an elaborate lie?

3. CreeDiddy

Posts: 2115; Member since: Nov 04, 2011

So true...they are following the trend set by Apple.

4. Hollowmost

Posts: 407; Member since: Oct 10, 2017

suicidal move

6. Cat97

Posts: 1708; Member since: Mar 02, 2017

Good bye, Xiaomi. Others will just take their place.

7. Ghost04

Posts: 506; Member since: May 03, 2014

Xiaomi has labelled themselves as a cheap/budget budget brand . Now its impossible to remove it . Unless they sell expensive phones under a separate name . Toyota is worlds most famous car brand. They are well known for their quality. Despite that they used Lexus brand to sell luxury cars . As no one considers the name Toyota Luxurious. This is a common and psychological thing that exists.

12. Ichimoku

Posts: 122; Member since: Nov 18, 2018

Make sense

13. anixo

Posts: 15; Member since: Sep 14, 2018

well said

17. Crispin_Gatieza

Posts: 3082; Member since: Jan 23, 2014

You weren't alive in the 70s to know Toyotas and Datsuns (Nissans in the US) were laughed at. Made in Japan was a punchline until the early 80s. Xiaomi is following the same path as Hyundai when they sold crap Excels in the US for $3,995 but gained a loyal following since their main competition was Yugo and slowly worked their way up-market. The Lexus brand was nothing new. Carmakers had been doing it for decades like Ford-Mercury, Dodge-DeSoto, Studebaker-Packard, Chrysler-Imperial and on and on.

8. User123456789

Posts: 345; Member since: Feb 22, 2019

Start using best pieces available like other brands, remove adds from UI, no more copied design from other brands.

9. epdm2be

Posts: 815; Member since: Apr 20, 2012

"...not a lot, but a little more expensive." "The price he mentioned is about $450" What a F hypocrite. This is a 50% price hike compared to the "is roughly equal to $300" mentioned in the article . Apparently the Chinese CEO's also started living in ivory towers. :-( "...so that most other manufacturers are raising the prices of their flagships to make them even more premium. " So these days selling your (Chinese) crap at higher prices is enough to become "premium"? I always thought that using better materials and adding innovative features made something "premium" but it apparently I'm wrong. Especially since these stupid manufacturers keep removing features from their supposedly high-end devices. Perhaps PA can explain to me why a mid-range can have a micro-SD-slot, 3.5" audio-jack AND an IR-blaster while the overpriced high-end phone has NONE of these! But hey... we got a gazillion camera's at the back, a 50 fixed focus 100MP selfie-cams at the front and a bloody heat-pipe inside, DOH! Fools. Xiaomi is digging its own grave. I give them no more then a couple of years when they pursue this!

11. yalokiy

Posts: 875; Member since: Aug 01, 2016

If they improve quality, then I'm ok with the price increase!

16. worldpeace

Posts: 3091; Member since: Apr 15, 2016

That okay as long as they also increase the specs. Maybe start with a 2k screen, 4000mAh+ battery, IP rating, microSD slot, and 3 years android version update (or more, since Lineage give more than that),

18. Tziggy14

Posts: 620; Member since: Sep 02, 2014

They're foolish to do this. It worked for Huawei because they invested in their R&D to make sure the phones justify the price increases. It worked for OnePlus because they have built a strong loyal following that listens to hardcore stock Android fans needs in a phone. What does Xiaomi offer besides offering excellent Apple knock off phones in cheap prices?

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