Financial Performance Analysis Of Xiaomi Group’s Multi-brand Strategy

With the development of the Chinese economy,PC computers and smartphones have gradually become popular,and the number of Chinese netizens has exceeded 1 billion.Mobile devices account for 99.6% of internet access,making the competition in the Chinese mobile phone industry fierce.In order to adapt to the development of society and the economy,cater to the changing market demand and business structure,Xiaomi has seized different niche markets by releasing new brands and collaborating with downstream ecosystem companies to expand into the Io T smart home appliance market.This strategy has made Xiaomi a major player in the mobile phone and Io T smart home appliance businesses,with multiple brands.Its multi-brand strategy has achieved certain results,but there is still a significant controversy in the academic community regarding the impact of multi-brand operations on corporate financial performance.Therefore,how to effectively carry out multi-brand operations to enhance corporate performance remains a question worth exploring.As one of the earliest companies in the mobile phone industry to adopt a multi-brand strategy,Xiaomi’s multi-brand strategy not only involves conventional acquisitions and the release of new brands but also forms certain brand associations with downstream ecosystem companies through cooperation,ultimately achieving multi-brand operations in the Io T smart home appliance field.Therefore,studying the multi-brand strategy and its effects on Xiaomi Group is of great significance.This article conducts an in-depth analysis of Xiaomi’s multi-brand operation methods,characteristics,and motives through literature and case studies.Using EVA analysis and financial performance analysis methods,it analyzes Xiaomi’s financial performance and provides supplementary analysis from a non-financial performance perspective,evaluating the effectiveness of Xiaomi’s multi-brand operation model.This article believes that Xiaomi’s multi-brand operation model effectively enhances the company’s financial performance,reduces risk,opens up new sources of profit,and enhances development prospects.However,it also brings about problems such as increased management costs and relatively insufficient technological innovation.This article aims to summarize the lessons learned from Xiaomi’s multi-brand operation strategy,propose effective solutions,and provide references for other communication manufacturing enterprises,in order to further improve financial management performance and promote sustainable development of enterprises.