Xiaomi Set to Open Shop in Africa as Chinese Smartphone Market Declines

Africa is about to witness a huge competition in the smartphone industry if recent reports are anything to go by.

Xiaomi, the apple of China comes to Africa….if you've ever used a Xiaomi product then you will know this might be a big deal.https://t.co/cON2CcGQkt

— ǝʞʎɥɔ ǝlɔun (@unclechyke) January 30, 2019

According to Asian tech publication, Chinese smartphone manufacturer, Xiaomi is set to launch a new department in Africa. The new department would work towards marketing Xiaomi devices across Africa.

Now, this wouldn’t be just a regular marketing department as Xiaomi is putting a lot of energy into making it work. The report also says that the head of the new Africa department will be the company’s current Vice President. Having that sort individual lead a new market entry signifies a lot and shows commitment.

Great job #Xiaomi . This is #RedmiGo phone . Some spec: Android Go based on Android 8.1. , 5" HD display , sd410 , 1 gb of ram , 3000 mAh battery , 8 MP and 5 MP selfie cam. All that for 80 euros (~$91). AMAZING 🔥⚡️👏 pic.twitter.com/ELgLbEdCiL

— SMART TOUCH ID🎙📱 (@SmartTouchID) January 30, 2019

Nevertheless, Xiaomi is not new to Africa and its devices have been sold on the continent since 2015. But much of these have been through partners and no direct market exposure.

But now, Xiaomi is looking to get into the market for real. Why?

Declining Chinese Market

The move was sudden but not unexpected. Despite having a population of over 1 billion people, China’s smartphone market has become quite stagnant recently. According to some reports, Chinese smartphone market witnessed another decline in Q3 2018.

Chinese smartphone sales suffer their biggest decline ever https://t.co/64igUWWAsE pic.twitter.com/GlQL5f9JAc

— CNN (@CNN) April 26, 2018

This decline will likely continue because consumers are holding on to their devices for longer periods.

Furthermore, the Chinese smartphone market remains heavily saturated despite declining sales. There are several big name brands competing for small pieces of the declining market.

This competition only means companies will spend much on marketing and product innovation, which as it stands will drain a lot of their revenues.

So Xiaomi is taking the easy way out. The company is looking to shore up its revenue base by expanding to other markets. And Africa is an attractive option.

Although the African market is experiencing similar problems as China in terms of consumers holding onto phones, there’s still much potentials here than anywhere else. Unlike other parts of the world, feature phones dominate the market. And this shows that there is still a huge market, untapped, for smartphone sales.

What Impact Could Xiaomi Have on African Market?

The African market is by no means a virgin one for smartphones. The industry is booming and is led by Transsion Holdings another Chinese company. Transsion manufactures devices like Tenco, Infinix and the ITel.

Xiaomi set to battle Transsion Holdings and Huawei in Africa https://t.co/sDQ4YufQeV

— Francis Ebuehi (@ebufra) January 30, 2019

But the entry of Xiaomi could make a dent on Transsion’s over 30% share of the market. With three brands and long time local presence, Transsion is not going give up any of its market share easily. But if there is any brand that could give it a good run for its money, it has to be the Apple of China.