With the success of Redmi in India and Europe, the Chinese phone producer Xiaomi has announced that it will split the two brands Xiaomi and Redmi to form two different brands. Even though not together, Redmi would be a subsidiary brand of Xiaomi.
The pocket-friendly Redmi brand has been a big hit in most markets, especially in India. In 2018, it rose to hold 27.3% share in the Indian smartphone market.
As soon as this decision was announced, the new brand Redmi scheduled a launch event on the 10th of January. This event will be celebrated by Redmi launching its new and first ever smartphone with a 48-megapixel camera sensor.
Redmi rose to popularity especially in 2018 with the models Redmi 5A and Redmi Note 5 Pro. These two were the most competitive devices in the low range smartphone category. And the trust of a brand like Xiaomi made them dependable as smartphones. And with the launch of the Redmi 6/A/Pro series, the brand scored through its competitors. As reported, Xiaomi shipped 11.7 million units of devices to India in the year 2018.
The reason to separate the two brands was the difference in the product profile. While Xiaomi is the more expensive luxury smartphone brand, with the newest and latest technology, backed by faster and better processors and features. Redmi is the more pocket-friendly phone. This does not necessarily imply that the phones sold by Redmi are good for nothing. Another difference between the two brands is that Xiaomi phones are not sold through e-commerce websites. While Redmi is a brand focused on sale through e-commerce.
Xiaomi reported a 49.1% uptick in YoY profits in the third quarter of 2018. And the brand kept soaring. But this split does point out to the difference in the products of the two brands. It is not sure that this would be the right approach to be taken. Will this uptick in revenue hold for long?