Xiaomi, the Chinese electronics and software company, came in the Indian market in July 2014, disrupting the market with affordable, good quality and reliable phones that drove sales instantly in an upward trajectory.
India now represents a major market for Xiaomi, evident considering the high volume of funds poured on marketing and advertising to maintain brand recognition and stay relevant in a highly competitive market.
The Chinese electronics company recently announced that the sum invested in the Indian market paid off as figures reveal that the Indian market accounted for 32% of the Xiaomi’s total global revenue of $18 Bn in 2017 – via three of its top-five sales channels.
The IPO filing of Xiaomi, released in Hong Kong showed that the top-five sales channels based in India comprises of a local e-commerce company, a consumer electronics distributor and a prominent international e-commerce company which occupy the second, fourth and fifth positions, respectively.
The filing kept the anonymity of the above-mentioned companies but we can quite evidently conclude that Flipkart represents the second-largest sales channel of the company, followed by TVS Electronics at the fourth position and Amazon India in fifth.
The emergence, growth and reach of Xiaomi is absolutely mind-blowing since the Beijing-headquartered company was able to dethrone the long standing market share leader, Samsung, barely three years after joining the Indian market. According to research from Counterpoint Technology Market Research, Xiaomi, Lenovo and Samsung are the top three selling brands on the two leading e-commerce platforms, Flipkart and Amazon. It further shows that the capture of a higher market share than Samsung is driven by high-sales on online platforms. The market share for the first quarter of 2018 stands at 31.1% share for Xiaomi and 26.2% share for Samsung.
Xiaomi currently boasts six smartphone manufacturing plants in India and are looking forward to set an 3 additional smartphone plans in the country in collaboration with electronics manufacturing company Foxconn.
Chinese players, notably Xiaomi, Vivo and Oppo are currently grabbing significant market shares in India. They have so far captured 54% of the smartphone market since stepping in the Indian market. Attracted by the significant opportunities the Indian market represents, Taiwan-based smartphone company ASUS also pushed its entry in the country after coming to terms with Flipkart in an exclusive partnership to sell its Zenfone which was launched for sale on Thursday. Following suit, Tim Cook, CEO of Apple is also planning to further drive Apple’s smartphone sale in the country.
India will keep being an important market for smartphone companies and companies must maximize on the opportunities available. The smartphone penetration rose from 199 million in 2015 to 378 million in 2018 and a recent study report by Morgan Stanley revealed that the country’s mobile market is growing at 23% CACR. Another report by Groupe Speciale Mobile Association (GSMA) reveals that the country’s mobile market crossed the milestone of 5.7 Bn mobile phone users and 340 Mn smartphone users in 2017.
Therefore, Xiaomi is confidently looking at the prospects of this market confident that it can expand its footprint even further.