During his visit to India, Xiaomi’s Founder and CEO Lei Jun talked about the company’s plans for India, strategies, targets, and some hints on the upcoming product line. Here is what he said:
1) Plans to increase offline market share:
“If we look at overall market, online is a small piece…so it’s rather dependent on how many people adopt the Internet. In China, after we have achieved such scale (in the online market), the challenge is how we can achieve the same in offline with efficiency. In India, after we achieved more than 50% market share in online space, the question is how to do the same in offline,” Jun said. More at ET. Note that the company had started expanding its offline distribution channel since July last year to around 5000 offline outlets across India.
2) New manufacturing plant:
Xiaomi recently inducted a second manufacturing plant in Andhra Pradesh, and claimed that now more than 95% of its phones in the Indian market would be manufactured locally. According to this ET report, the company might even look at exporting Indian manufactured phones in the future. The smartphone maker recently claimed that it has crossed $1 billion in revenue from its India operations. Xiaomi makes money by selling phones, wearables, accessories, air purifiers, etc. In Q4 2016, Xiaomi was the second largest vendor in India in terms of smartphone shipments, according to IDC. The company’s Mi Band shipments also accounted for 10.3% of overall Indian wearable market in Q2 2016.
3) More warehouses and service centres
The company is also setting up a third warehouse in Delhi NCR and plans to double its services centre count from 250 to 500 by the first half of this year. Note that Xiaomi has its own e-commerce store named mi.com in India; In July 2015, Xiaomi announced that it would invest in setting up own warehouse and logistics as well.
4) Open for tie-ups and investments with startups
In an interview with The Hindu, Jun said: “Globally, we have invested in 165 companies. We have seamlessly integrated those services into our software…We will use the same strategy here in India. If there is a start-up in India which does good work, we will work together.” When asked whether Xiaomi would invest in startups, Jun told The Hindu: “Of course. We are looking for more market share here, so we need to work with high-quality start-ups.” Note than in India, Xiaomi has a tie up with payments startup MobiKwik for ‘one-touch-recharges’ integrated straight into MIUI—Xiaomi’s custom Android ROM.
5) On the upcoming product line in India and plans to enter the financial sector.
Jun also told The Hindu that the company will be launching a new set of products, although he didn’t reveal what kind of products they would be. Jun also hinted that the company is interested in expanding into financial sector in India: “We are exploring the possibility of providing financial services in India. But this sector is highly regulated. It requires different licences. If we could obtain such licences, we are more than happy to be part of this financial services innovation in India. We need to understand if there are limitations on foreign entities.” Xiaomi also has a payments service called Mi Pay but is only available in China right now and has tied up with Bank of China and Union Pay, a card network in China.
6) On Creating new jobs and revenue targets
Jun also spoke about how the company target of creating 20,000 new jobs in the next three years through investment into offline retails, manufacturing and distribution. More at Hindustan Times. Speaking to ET, Jun said that the company aims to generate close to $15 billion in overall revenue by focusing on emerging markets like India and Indonesia.