China’s ‘mistakes’ start wowing Korean buyers

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China’s ‘mistakes’ start wowing Korean buyers

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Kim Byung-mo, a 34-year-old office worker, recently posted a message on an IT-related discussion group on the Internet saying he finally bought one of the “mistakes from mainland China,” prompting a flurry of comments. Many people wanted to know where they could find the same product.

The product was “Mi Band,” an activity tracker worn on the wrist by manufacturer Xiaomi. It is similar to the American-made Fitbit, the best known activity tracker.

The “mistake” appellation takes some explaining. The term was first coined in 2009, when the model PL 30 earphones from SoundMAGIC Technology Development attracted the attention of audiophiles in Korea. Made-in-China earphones had a reputation for flimsiness and subpar sound quality. When word spread that the 20,000 won ($17.30) PL 30 had a sound quality usually found in earphones costing between 100,000 won and 200,000 won, someone said it must have been a mistake from mainland China. The term stuck for surprisingly good products from China.

And there are more and more of such mistakes. Many of them are made by Xiaomi, the Beijing-based manufacturer best known for incredibly affordable smartphones. A breakthrough product for Xiaomi in Korea was the 10,400 mAh Mi Power Bank, an external battery charger for phones and laptops. It has a quick charging capacity, an Apple-like elegance of design and a price tag as cheap as 14,000 won, making it a hit with the younger generation. A charger from Samsung Electronics with the same capacity costs almost 50,000 won. Xiaomi’s chargers with various capacity have an almost 70 percent market share according to Enuri.com, a price-comparison Web site.

The Mi Smart Scale, which retails for around 99 yuan ($16) in China, sells in Korea for up to 35,000 won but it’s getting rave reviews for its iPhone-like design and its ability to connect with smartphones. Lately, a neat, white Bluetooth speaker from Xiaomi gained popularity among Koreans. The portable speaker costs around 30,000 won, a third of the price of speakers with similar specifications and functions. Reviewers commented in Web discussions that “there is no reason not to buy one.”

Made-in-China specialized products such as GoPro-type action cameras, projectors and drones are also popular. The SJ6000, an action camera from SJCAM, the UC40, a portable LED projector from Unic, and Syma’s X8C drone have Korean fans praising their quality and price.

At the beginning of the China “mistake” boom, prospective buyers in Korea turned to AliExpress, a Chinese online shopping mall. But growing demand has spurred many Korean shopping malls to import and sell the products. According to Ticket Monster, a Korean mobile commerce company, sales of Chinese-made consumer electronics products in the first half jumped 2.7 times from the same period a year earlier. For Xiaomi, in particular, its battery charger was the only product available in the first six months of last year and posted sales of 2,000 during the period. For the same period this year, however, the number of products from the Chinese producer grew to eight and they had combined sales of 170,000 units.

China’s “mistakes” now present a direct challenge to Korean manufacturers. Overseas, China’s inroads are already measurable. Haier’s market share in the global refrigerator market exceeded 15 percent last year, which is 2.5 percentage points lower than that of the world’s No. 1 Samsung Electronics, but 5.1 percentage points higher than that of LG Electronics.

“Unless they come up with a distinctive technology or value,” said Lee Kyung-mook, professor of business administration at Seoul National University, “Korean consumer goods makers won’t be able to avoid the competition.”

BY KIM KYUNG-MI, SEO JI-EUN [seo.jieun@joongang.co.kr]

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