Xiaomi's phenomonal sellout event raises suspicions of inflated sales

Summary:The phonemaker claimed it sold out 10,000 smartphones within 36 seconds in Hong Kong during a promotion, but upset consumers who failed to get the device claim the sales numbers may have been inflated.

Xiaomi, a Chinese budget smartphone maker, announced on Wednesday that it sold out 10,000 sets of "Red Rice" brand smartphones within just 36 seconds, a new sales record in overseas markets, said a TechWeb report, citing Xiaomi's official Facebook announcement.

The Red Rice smartphone, which is equipped with the latest 28nm workmanship MTK6589T Turbo quadcore 1.5GHz and 4.7 inch IPS Capacitive Touchscreen, was only priced HK$999 (US$129) on its official website.

All customerss were required to register on the website for a "booking code" prior the sales. These with a code were then able to log on the website to purchase a set of smartphone at 12pm sharp on December 18 when Xiaomi released the phones.

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Xiaomi's phenomenal sell out campaign raises suspicions of inflated sales.

It took Xiaomi 9 minutes to sell all the 10,000 Red Rice smartphones last week in Hong Kong and 1 minute this week in Taiwan, the phone manufacturer announced earlier. 

However, complaints flooded Xiaomi's official Facebook accounts from consumers who could not get hold of the  Red Rice smartphone. "The system informed me that all the smartphones were sold out 5 seconds after the sale began. How should I believe in your 36-second lies?" one consumer left a message in Xiaomi's Facebook account.

In a subsequent reply, Xiaomi told the consumer that the timer on the website might be delayed and the consumers should have refreshed the page.

Some Hong Kong consumers also indicated that Xiaomi's "sales gimmick" was very likely to have violated relevant sales ordinance in the city.

In a NetEase comment published on Friday, columnist Ji Yongqing said Xiaomi plays the "hunger marketing gimmick" because the company, on one hand, tries to create a sense of scarcity to the consumers, while being restricted by its production capacity in the early stage.

But it is time for Xiaomi to consider shifting the sales strategy as hunger marketing is no longer suitable for a company which has successfully established its brand.

"The negative effects of hunger marketing now emerge in China as consumers find that they are not able to book for cheaper prices online, but they are able to purchase the phones from the third-party dealers, who will then realize Xiaomi only provide their products to the deals and then feel cheated," said Ji. 

Topics: Smartphones, China, Hong Kong

About

Cyrus Lee, writing under a pen name, is a Hong Kong-based reporter in an English-language newspaper and a correspondent for a radio station.

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