Both are Internet ecosystem companies, but why is LeTV’s situation worse than Xiaomi?

The ecological chain approach was pioneered by Xiaomi and has been imitated by many competitors and even non-competitors. However, many imitators have not achieved the expected success, and have only been dragged from single-category competition into multi-category competition. The so-called "ecological chain" has become a simple business expansion.

It can be said that ecology is a vocabulary exclusive to the Internet, and the manufacturing industry will call it the industrial chain (upstream and downstream) or diversification strategy. The reason why the Internet has an ecology is because of the chemical reaction that occurs after the ecology is established. To put it simply, it is the account system. When a person can use a certain Internet product of a company, he can quickly jump to other products, such as from search to encyclopedia to Tieba. Although the account system has been impacted in the mobile Internet era, it still has a large traffic dividend.

The core gameplay of the ecology is not to divide brands, such as traditional manufacturing likes to divide high-end brands, mid-range brands, and low-end brands, but user groups. To put it simply, ecology is to provide its core user group with all the products they need or potentially need. The closest hardware ecology is hardware and its accessories or peripherals, such as mobile phones, headphones, and mobile phone cases.

The success of Xiaomi is that it has a very consistent user group. If you are not a person who pursues cost-effectiveness, you will naturally be eliminated by Xiaomi's rush buying behavior again and again. Therefore, the user group is relatively single, which better determines the needs of this group of people.

Just having a consistent user base is of course not enough. You also need enough channels to reach your users. This is also Xiaomi’s advantage. Xiaomi's user base is generally Internet users and can be easily reached through e-commerce. At the same time, because the supply volume is relatively small, it is easy to grasp the channels, and a large number of users have accumulated on Xiaomi.com (this group of users wants to grab mobile phones), which actually lays a solid foundation for Xiaomi's ecological chain.

The last thing is the brand. Many people think that Xiaomi cannot go high-end by bundling its brand with cost performance, but at the same time, Xiaomi has created a very universal brand image for itself. On the other hand, Huawei has a business orientation. A business mobile phone, very good positioning; a business rice cooker, a business sweeping robot. For Xiaomi mobile phones, cost-effectiveness is a brand barrier that cannot increase premiums, but for Xiaomi's ecological chain, it is an innate advertisement.

Having a user base (organized), channels (reaching customers), and brands (cross-domain) are enough to build an ecological chain. If we look at the many imitators of Xiaomi, none of them can beat them. If we really want to say that it has something to say, it has to be LeTV. The concept of negative profits has indeed made LeTV hardware popular.