Xiaomi scraps COD for its next Redmi Note 5 flash sale, we investigate why

Xiaomi

When a fairly popular YouTuber, Dhananjay Bhosale, decided to rally against the emergence of a parallel “black market” where the latest Xiaomi Redmi Note 5 smartphones were being sold at a slight premium over the MRP – he had no inkling of the backlash he was about to receive. Overnight, his professional Facebook Page started receiving some really nasty feedback including multiple 1-star reviews. 

His only fault: standing up to unauthorised reselling of the new Xiaomi Redmi Note 5 phones at a premium. 

Xiaomi COD 5

While Bhosale is not solely responsible for Xiaomi to scrap the popular cash-on-delivery (COD) option for its next sale (in fact there are many more activists like him), it definitely attracted the right attention. That of Jai Mani, the Product Head at Xiaomi. 

Bhosale told us over email, “Many of my subscribers were complaining to me since the launch of Redmi Note 4 that they are not able to buy the device. I have talked about this multiple times in my videos but no one ever responded. This time Jai Mani replied to one of the tweets seeking suggestions so I gave him all the suggestions I had.“

But scrapping COD wasn’t one of them. 

Xiaomi Redmi Note 5 Pro COD 2

What is the problem really?

Here’s the thing: Xiaomi sells approximately 3 million or 30 lakh phones every quarter in India. That’s almost 33,000 phones a day!

With its increasing popularity, the Chinese smartphone maker has leapfrogged into one one India’s most loved and most sold brands. However, buying one of Xiaomi’s aggressively-priced smartphones in India is tough. Thanks to the flash sale system. 

In order to bring its latest smartphone soon to India, Xiaomi brings limited inventory to the country, and sells it on a specific date and time. For example, there is a sale happening on the March 7 at 12PM. This is the first time that the Redmi Note 5 Pro 6GB is finally going on sale. But, it has created an unwanted problem: resellers buying the phone in bulk and selling it for a premium. Genuine buyers who want to buy the phone for personal use are affected as a result. They have to ultimately end up waiting for the next sale. 

In fact, a simple search on popular classified ads websites like OLX and Quikr revealed tons of listings for the new Redmi Note 5 phones being sold for a higher price than MRP. 

Xiaomi Redmi Note 5 Pro COD 4

Thankfully though, Xiaomi is a very community-driven brand that listens to user feedback seriously. Here’s what a Xiaomi spokesperson had to say when we contacted them, “As part of an experiment to curb reselling, we have decided to remove the COD payment option for the initial sales of Redmi Note 5 Pro, giving genuine consumers a better chance at purchasing our products. We have always, and continue to stringently discourage unauthorised reselling across all our channels.”

Unfortunately, our question – What percentage of the sale is generally on COD? And, doesn’t this decision affect Xiaomi as a business? – was unanswered. 

Is scrapping COD the only solution?

Interestingly, Bhosale strongly thinks scrapping COD is probably not the best solution. He says, “COD should be there for all sales. There is still large number of audience who like to have the COD option. Best solution is to increase the stocks and remove flash sales which OnePlus was able to achieve years ago so its hard to believe that Xiaomi can’t do the same considering they are the number 1 brand in India. Should we expect the stocks to reduce as company enters into US and other international markets? How will they manage stocks then?”

We did monitor conversations across different channels on Facebook and Twitter, and suggestions ranging from trying the pre-ordering model like Samsung or selling it to only verified profiles cropped up.

Redmi Note 5 pro

However, for better or for worse, Xiaomi has decided to remove the COD option as an experiment for this sale. We’ll have to wait and watch if it actually works. 

What about Bhosale’s online credibility, though? In fact, we asked him if he would continue his online activism. His response was positive, “I would any day put forward my suggestions to any company which is beneficial for both, the user as well as company.”

“My subscribers who know about the issue — limited to Twitter — are supporting me as I’ve not done anything wrong plus I just put forward my suggestions. It would be too much to say that Xiaomi took the decision because of me. Let it be known that I don’t take credit for the same,” he signs off.

What do you think about Xiaomi’s decision to scrap COD payments? Let us know in the comments section below. 

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Ershad Kaleebullah
ershad.kaleebullah@u2opiamobile.com

When Ershad isn't writing, he spends time killing virtual zombies on his PS4. Having worked with a slew of renowned publications like PCWorld, Channelworld, CIO, NDTV Gadgets (now Gadgets360), MySmartPrice, The Inquistr, and 91Mobiles, Ershad brings a whole world of experience to Mr. Phone. He is trying hard to convert all the team members into Apple fans but is facing a lot of resistance. Is anyone willing to help?