On October 19, Lei Jun, founder and CEO of Xiaomi, wrote: “India is an extremely important market in Xiaomi’s globalisation strategy. It has become our largest market outside of mainland China.”
It was not just a letter to Xiaomi’s India fans on Facebook, but he was signalling a much larger directional change in the company’s operations in the country. The Chinese smartphone maker, which for the longest time sold phones only through e-commerce sites, has a wide variety of products (not phones) lined up for launches in India.
It has plans to bring a bunch of smart (internet-connected) appliances, cycles and scooters, rice cookers, and floor cleaning robots and televisions to India. “We are beginning to build the product strategy in India. The first product was an air purifier. In a year or two, we will bring in many products in India,” said Manu Jain, country head of Xiaomi India.
The launches will make Xiaomi the only phonemaker to have a much larger footprint across a large set of smart products. That’s also because, Jain said, the company wanted to focus on China and India.
Founder Jun was waiting to get some good sales numbers from India before launching products beyond smartphones. In the July to September quarter, for the first time, the company sold more than two million phones, according to data from research firm IDC.
One out of every four smartphones sold in the country was Xiaomi’s. It made 75% of the phones it sold, locally, and is taking its distribution offline. The phones are now available at about 8,500 outlets.
In China, it has four lines of businesses. Selling operating systems, a large e-commerce business (third largest in China), smartphones, and the smart ecosystem of devices, gadgets, vehicles and devices.
Jain said, that in the long run, Xiaomi hopes to make more revenue from selling operating system, not smartphones. There are some products specific to India, too. A large number of people use dual-SIMs, so it launched a dual-Whatsapp feature. The Mi OS is available for download on the Android app store.
A larger variety of products also allow Xiaomi to build its e-commerce business, which is limited to smartphones and air purifiers in India. Still, it is already one of the top-10 e-commerce companies in the country.
Jain said that the company is taking sometime, as the team was small and focused on selling phones. However, it has increased its headcount three times to 150 people, over the last year.
“We have built this without spending money on marketing… The gap between the number two player and us is 50,000 units, and few years ago the gap was a few million,” said Jain. “The two brands (Smasung and Micromax) have been here for 10 years… Look at any parameter, and look at their growth, versus ours.”