In a surprising turn of events, Xiaomi has taken the top spot in wearable devices sales worldwide for the first time, according to a recent report by Strategy Analytics. This achievement comes on the heels of Xiaomi’s reentry into the world’s top five smartphone sellers.
Xiaomi Overtakes Apple and Fitbit
In the second quarter of 2017 (Q2 2017), Xiaomi shipped an impressive 3.7 million wearable devices, surpassing Apple’s sales of 2.8 million units. Fitbit, which had been a dominant player in the wearables market, saw its sales decline by 40% to 3.4 million units.
Market Share and Growth
While both Xiaomi and Apple experienced year-over-year growth in their market share, Fitbit’s share plummeted from 29% to 16%. The rest of the field accounted for a further 11.7 million units, or 54% of all wearables shipped during the quarter.
| Company | Market Share (Q2 2016) | Market Share (Q2 2017) |
| — | — | — |
| Xiaomi | 15% | 17% (+2%) |
| Apple | 9% | 13% (+4%) |
| Fitbit | 29% | 16% (-13%) |
Competitive Strategies
Xiaomi and Apple employ different approaches to wearables. Xiaomi offers a range of affordable products with heart-rate monitors and alerts, such as the Mi Band, which is priced at just $14.99 in the US. In contrast, the Apple Watch is a premium product with a full set of features, priced upwards of $269.
Fitbit’s Challenges
Fitbit’s position in the market has become uncertain. According to Strategy Analytics’ Neil Mawston, "Fitbit is at risk of being trapped in a pincer movement between the low-end fitness bands sold by Xiaomi and the fitness-led, high-end smartwatches sold by Apple."
Future Prospects
The next Apple Watch may include extended health tracking capabilities, which could help Apple reclaim the top spot. However, for now, its lack of health band options is what keeps Xiaomi ahead.
Xiaomi’s Resurgence
This achievement marks a significant milestone for Xiaomi, which has had a resurgent 2017 so far. After two disappointing years of struggling to maintain explosive growth and missing sales targets, the company has bounced back with a strong performance in Q2.
A push into offline retail in China and progress in India, where Xiaomi cracked $1 billion in revenue last year, have contributed to a more optimistic outlook this year. CEO Lei Jun claims that the company has reached "a major inflection point in its growth."
Global Expansion
Xiaomi’s phone sales were up 70% quarter-on-quarter in Q2 with 23 million sold in the same period. The company is now pushing forward with its offline retail strategy and furthering its global expansion plan thanks to a $1 billion loan secured last month.
By expanding its product offerings and improving its distribution channels, Xiaomi is well-positioned to maintain its lead in the wearables market.
Conclusion
Xiaomi’s success in wearable devices sales marks an exciting development for the company. With its affordable products and competitive pricing, Xiaomi has managed to outperform established players like Apple and Fitbit. As the company continues to expand globally and improve its product offerings, it will be interesting to see how it maintains its lead in the wearables market.
Key Takeaways
- Xiaomi has taken the top spot in wearable devices sales worldwide for the first time.
- The company shipped 3.7 million units in Q2 2017, surpassing Apple’s sales of 2.8 million units and Fitbit’s sales of 3.4 million units.
- While both Xiaomi and Apple experienced year-over-year growth in their market share, Fitbit’s share plummeted from 29% to 16%.
- Xiaomi employs a competitive pricing strategy with affordable products like the Mi Band, priced at $14.99 in the US.
- The company has secured a $1 billion loan to further its global expansion plan and improve its distribution channels.
Sources
- Strategy Analytics report
- Company statements and press releases
