Gadgets from China gain trust and profits in Korea

Xiaomi Mi Band, Xiaomi Mi Power Bank, Lenovo Ultrabook, Lenovo Phab Plus, Acer Aspire Switch 10E, DJI Technology Phantom 3, SYMA X5C and Huawei Nexus 6P.

Koreans are catching Chinese IT fever, as more reliable and affordable products are being scooped up by tech-hungry buyers.

Leading the new surge in interest and sales is Xiaomi, the Chinese electronics company renowned to be the world’s fourth largest smartphone maker. The fad began with the company’s “Mi Power Bank,” a supplementary battery for smartphones which the company released at a price below production cost to introduce the brand name.

Xiaomi’s “Mi Band” costs less than 20,000 won, while a similar Korean brand would be priced at more than 50,000 won. After the release, the product was jokingly dubbed a “mistake of China” because it was of high enough standards to tear down pre-existing prejudices on the low quality of Chinese manufactured products.

Jeong, a 42-year-old office worker is a big fan of Xiaomi products. His appreciation for Xiomi started with the “Mi Band,” which tells the user the total number of hours they have slept and the number of hours of deep sleep. The band, priced at 19,000 won, also has a pace-counting function and alerts for text messages and incoming calls.

It took a week for the band to be delivered due to surging demand but he is satisfied because of the quality of the product. “I like the way it only provides simple necessary functions that are easy to use, at a good price and design,” said Mr. Jeong, “I’m thinking of purchasing a Xiaomi smartphone and weighing machine as well.”

Domestic purchasing agencies for Xiaomi sprung up after word spread that the brand’s “quality exceeds price.” Soon Xiaomi’s products including “Mi Band”, their smartphone “Redmi Note,” earphones and even their weighing machines gained popularity.

There are now about 124 online cafes related to Xiaomi at Korea’s No.1 portal site Naver. At one of the cafes, named Xiaomi Story, there are 123,000 members. Though the number is still behind Mifen - Chinese fans of Xiaomi - it is noteworthy that there is also a ‘fandom’ in Korea.

According to 11th Street, a Korean online shopping outlet, the accumulated revenue of Xiaomi products from the beginning of this year until August has skyrocketed by 3,823 percent.

This rapid growth is astonishing considering an official Korean corporation of Xiaomi has not been established yet.

“Xiaomi’s popularity was enough to sell out 1,500 units of ‘Mi Band’ in only four hours after the official domestic launch on September 8,” said Seo Hye-rim, the mobile phone and accessories managing director of 11th Street. “Xiaomi products are now claimed to be the ‘might of China’ rather than the original prank calling them ‘mistakes of China’.”

Xiaomi is not the only Chinese IT company taking big leaps in Korea. Lenovo has been showing remarkable growth. Despite its relatively short 10-year business history in Korea after establishing a Korean corporation in 2005, it ranked number one in some of the laptop categories of the offline market for the first time this year.

The rate of growth is even steeper in online markets. Among laptop brands sold through 11th Street, Lenovo recorded the highest year-on-year increase in sales. Lenovo plans to step into the domestic smartphone market by next month.

The Lenovo “Phab Plus” is a phablet product - a combination of a smartphone and tablet - recently introduced at the Internationale Funkausstellung (IFA) held at Germany, the world’s biggest trade show of consumer electronics.

The product is equipped with 6.8 inch screen, making it the biggest of all the phones released in Korea. It also provides full high definition (HD) display and Dolby Atmos audio, which offers high quality sound comparable to theaters. The main target of “Phab Plus” is consumers in their 20’s who enjoy playing mobile games and consumers between 30’s and 40’s who frequently use mobile navigation services. Lenovo plans to begin sales through open markets at a price about 300,000 won.

As well, Acer, a Taiwanese IT company of Taiwan, is also gaining fame with its “Aspire Switch 10 E’ which was released in Korea at the end of June. The 2-in-1 laptop capable of switching to tablet PC by detaching the screen, costs around 500,000 won. It comes with a 10-inch screen and weighs only 1.19 kilograms. A full battery lasts for a maximum of 12 hours.

“With the premium design, we have sold out for the fifth time in just two months after the roll out,” explained an official from Acer. The “Aspire ES1” series, which costs about 200,000 won, is also gaining popularity. “We are building a system which enables customization in the product development process, installing only the necessary functions,” the official added, “Our competency lies in the price benefits we offer to customers by cutting logistics and labor costs.”

The Chinese drone market is also taking off. The hottest gadgets of the year are mostly produced by three Chinese companies; DJI Technology, SYMA and MJX. According to 11th Street, the three drone makers’ growth in revenue from the beginning of the year until August, skyrocketed 1,248 percent year-on-year.

Of the three, DJI Technology is known as the “Apple of the drone business” boasting a neat design and high performance. The company’s Phantom Drone series is a hot selling product. The Phantom 3 from the series is sold at 1.7 million won.

Huawei, the world’s third biggest smartphone provider and also a conqueror of Samsung Electronics in its home nation China, is aiming for the domestic market.

After its entrance in the wireless telecommunications network device market by establishing Huawei Korea in 2007, it released a smartphone “X3” last year to officially start competing in Korea.

Recent announcements by the company say it will expand its service centers to 50 nationwide from its existing 42 centers.

Huawei Korea is the first in the industry to introduce a free after-sales service for smartphones in January.

Kelvin Ding, CEO of Huawei Korea said, “We will expand investments on innovative companies including Korean startups and provide college scholarships to widen the chance of youth employment in Korea.”

The company’s progress in the world market is considerable. Huawei joined Google to introduce the “Nexus 6P”, the first smartphone to apply the latest Google Android operating system Marshmallow, on Sept. 30.

BY KIM HYUN-YE [kim.jeehee@joongang.co.kr]