Cash on Delivery payment option removed for Xiaomi Redmi Note 5 Pro sales to prevent reselling
The Xiaomi Redmi Note 5 and the Redmi Note 5 Pro were launched in India on February 14. The branding is confusing because the Redmi Note 5 sold in India is a rebrand of the Redmi 5 Plus sold in China, whereas the Redmi Note 5 Pro is an entirely new device that was launched in India first. It will be sold in China as the Redmi Note 5.
In India, three flash sales have been held so far on February 22, February 28, and March 7 for the Redmi Note 5 and the Redmi Note 5 Pro. In each of the three occasions, the two phones have been selling out in an astonishingly quick amount of time. Xiaomi has highlighted the fact that in the first sale, more than 300,000 units of the Redmi Note 5 and the Redmi Note 5 Pro were sold within three minutes. However, as the phones aren’t available via offline retail yet, this means that most of the potential buyers of the phones haven’t had a chance to purchase them so far.
This problem is nothing new, as consumers have been facing it since Xiaomi’s very first flash sales in India in 2014. Demand continues to be more than supply for the Redmi series in India, which leads to the result of phones being sold out in seconds. We have previously talked about how this has an impact on Xiaomi’s sales, as consumers cannot purchase Xiaomi phones and instead are forced to turn towards other smartphone vendors.
In order to solve this issue, the company has improved its offline retail channels. However, as the Note 5 series is only available online for now (it will be available via offline retailers in the near future), the situation still remains poor for potential buyers of the Redmi Note 5 / Note 5 Pro who have no idea whether they will be able to purchase the phone they want in this week’s sale, or next week’s sale, or even later than that.
One big problem that leads to the phones being sold out within seconds is reselling. Resellers buy multiple units of these phones and then resell them at a premium, promising guaranteed stock. This practice affects genuine buyers, as they can’t actually get a phone for themselves.
In order to solve this issue, Xiaomi has turned towards the drastic option of removing the Cash on Delivery (COD) payment option for sales of the Redmi Note 5 Pro on Mi.com and Flipkart. The Cash on Delivery payment option was no longer available on the March 7 sale, and Xiaomi hasn’t shared details about when the restriction will be removed, except for promising that it will only be there for initial few sales.
In a forum post, the company acknowledged that “many of you have not been able to buy [Redmi Note 5 and Note 5 Pro], despite us bringing very large quantities […]”. It added: “We have always, and will continue to stringently discourage unauthorized reselling across all our channels.” The removal of the Cash on Delivery option will give a better chance to consumers to buy the company’s products, according to Xiaomi.
It remains to be seen whether the strategy works. Unauthorized resellers have used the Cash on Delivery option in the past, but they can use other payment options as well. The move can even backfire as the Cash on Delivery option remains highly popular with genuine buyers as well. Time will tell whether this improves the buying experience of the Redmi Note 5 Pro, but here’s hoping that the company does more steps (such as bringing more quantities of the phones) to satisfy the demand of potential buyers.