With Xiaomi announcing that its air conditioner shipments surpassed 8.5 million units in 2025, marking a year-on-year growth exceeding 24%, and Pop Mart revealing plans to launch its IP-themed small appliances globally on JD.com and other e-commerce platforms in April 2026, cross-border entrants in the home appliance sector have once again ignited heated discussions. How should established industry giants respond and find avenues for breakthroughs?

Written by Wen Jian

The foray of companies like Xiaomi and Pop Mart into the home appliance industry has captured attention and sparked debate, not merely due to the commercial moves themselves but, more importantly, because of the underlying rationale and external support driving their entry. After all, in today's home appliance landscape, there is limited room for speculation and deception; only sustained and substantial investment can yield tangible results.

From Xiaomi disrupting the major appliance market with its internet-centric mindset to Pop Mart leveraging its IP momentum to enter the small appliance arena, industry observers note that while these cross-border players employ different business strategies, they collectively break the industry's entrenched patterns. They inject new vitality into this mature market, prompting deeper reflections on the industry's future development, transformation, and evolution.

Xiaomi's cross-border entry has reshaped the competitive logic of the home appliance industry through an efficiency revolution. As an outsider to the sector, Xiaomi Air Conditioner did not follow the traditional brand path. Instead, it deeply integrated its high cost-performance positioning, efficient and low-cost operational model, and internet-based marketing approach into the traditional air conditioner category.

Behind the 8.5 million unit shipments in 2025 lies Xiaomi's precise understanding of industry pain points. By bypassing the multiple markups of traditional channels, it reduced per-unit channel costs by 15%-20% through a primarily online direct sales model. Combined with supply chain optimization and technological cost reductions, it pushed the price of first-tier energy-efficient air conditioners to the industry's lower limits, breaking the traditional brands' premium pricing system.

More importantly, Xiaomi has redefined the marketing and service systems for home appliances with its internet mindset. Unlike traditional brands' deep cultivation of offline channels, Xiaomi leverages its Mi Home ecosystem to integrate air conditioners into a smart home closed loop. With 70% of users utilizing its smart connectivity features for scenario-based interactions with other devices, and through youth-oriented marketing tactics like social media promotions and KOL reviews, it quickly reaches young first-time homebuyers and renters, precisely matching their demand for cost-effectiveness and intelligence. This 'hardware + ecosystem + service' model not only propelled Xiaomi to the forefront of the air conditioner industry but also compelled traditional brands to accelerate channel innovations and intelligent transformations.

In 2025, Xiaomi Air Conditioner followed Gree Electric's lead by offering a 10-year free warranty service for residential air conditioners and even extended it to cover residential central air conditioners, signaling a clear competitive strategy aimed at challenging the industry leader.

If Xiaomi's core competitiveness lies in efficiency and ecosystem, then Pop Mart's cross-border venture empowers the young demographic through IP, opening up a new track in home appliance consumption. As a leader in the collectible toy (art toy) industry, Pop Mart's foray into small appliances was not a spontaneous decision but a meticulously planned 9-month effort. This included assembling a professional team, completing industrial and commercial changes, and collaborating with top-tier OEM partner Xinbao Corporation for large-scale stockpiling. Its core advantage lies in its built-in IP resources and massive fan base, with 100 million registered members globally and an extensive IP matrix providing natural traffic support for its small appliance business.

Pop Mart's cross-border move transcends the traditional 'function-first' logic of small appliances, emphasizing emotional value and scenario-based experiences. Industry sources reveal that its initial product lineup, including electric kettles, coffee makers, and hair dryers, are not mere IP stickers. Instead, they incorporate iconic elements of MOLLY, LABUBU, and other IPs into design, color schemes, and details, paired with limited-edition gift boxes and accessories. This extends the surprise factor of art toys and elevates appliances from 'practical tools' to 'lifestyle aesthetic carriers.' Future plans may include beauty mini-fridges.

This model precisely aligns with the consumption demands of Generation Z and even younger demographics, who are willing to pay a premium for aesthetics and emotional resonance. Pop Mart capitalizes on this trend, extending IP value from collectibles to daily use and offering a new path for the small appliance industry to break free from homogeneous competition.

Of course, whether Pop Mart's small appliances can ignite enthusiasm among niche users remains uncertain. However, the company's decision to explore this new path suggests it is well-prepared and has identified hidden consumer demands and drivers.

From Xiaomi to Pop Mart, cross-border challengers are not just redistributing market share but revolutionizing industry perceptions and development logic. Xiaomi demonstrates that efficiency optimization remains possible in the home appliance industry, with internet thinking and ecosystem synergy capable of disrupting traditional patterns. Pop Mart reveals that home appliance consumption has entered an era of dual demands for 'function + emotion,' with IP empowerment opening up new growth avenues.

The practices and explorations of these two companies, in the eyes of industry observers, compel traditional home appliance enterprises to ponder: how to balance cost-effectiveness and quality, how to reconcile functionality and emotion, and how to respond to the evolving demands of young consumer groups. These are both future opportunities and present challenges.

Of course, the cross-border journey is no smooth sail for any company. Xiaomi must continue addressing manufacturing and quality control shortcomings, while Pop Mart must avoid overexploiting its IPs and balance aesthetics with practicality. Nonetheless, these challengers are undeniably driving the industry's transition from 'scale competition' to 'value competition' and from 'product-centric' to 'user-centric' approaches.

Looking ahead, as more cross-border players enter the fray, the home appliance industry will witness a more diversified competitive landscape. Brands that can precisely grasp user needs and sustain innovation will ultimately seize the initiative in this transformation. Similarly, in recent years, companies like Haier, Midea, Gree, Hisense, Changhong, TCL, Aux, and Skyworth have embarked on new cross-border expansions from home appliances to other industries and fields, necessitating reflections and strategic reviews on how to 'leverage strengths and avoid weaknesses.'

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