Xiaomi banks on integrated smartphones for next growth phase

Xiaomi banks on integrated smartphones for next growth phase

Chinese smartphone and consumer electronic company Xiaomi, which has been on the recovery path in the Indian market since 2023, is banking on an end-to-end premiumisation play, integrated smartphone Artificial Intelligence of Things (AIoT) offering, and omnichannel strategy for its next leg of growth over the next three years, its India president Muralikrishnan B said in a media interaction on Wednesday.

“We hit a speed bump in 2022… but 2023 has been the year of recovery for us. And we can only get stronger from here on,” Muralikrishnan said, adding that the company has a much longer game plan for the next three years.“We want to be the aspirational Indians’ most preferred and pioneering ‘smartphone x AIoT’ brand,” Muralikrishnan said.

“Xiaomi is in a very unique position to not just attempt, but deliver an integrated ‘smartphone x AIoT’ strategy because we already have the portfolio of smartphones, tablets, smart televisions, air purifiers, water purifiers, robot vacuum cleaners, wearables, hearables, and the entire spectrum, Muralikrishnan said.

With regard to the end-to-end premiumisation strategy starting this year, the company is looking to improve quality of services across its value chain which includes improving product design, operating system, packaging, leveraging technology for customer support, as well as quality after sales service for premium experience.

“For us, end-to-end premiumisation is not just about selling expensive devices but it’s about providing a lot more value to the customer,” Muralikrishnan said. He said that over the next three years, the company would want to have a substantial share of the premium segment.Since 2023, Xiaomi has also been focusing more on offline channels by expanding its distribution and retail networks across the country.

In a first since 2017, Xiaomi lost its number one position in the Indian smartphone market in the October-December quarter of 2022, according to industry estimates. Xiaomi’s market share slipped to 17% in October-December 2022, from 21% in Q1 2022, as per Canalys. Despite the overall weakness in the market, one of the reasons of fall in shipments and loss in market share for Xiaomi was its cluttered portfolio of phones.

Owing to its reset, refresh and recharge strategy, a leaner portfolio as well as growth in 5G smartphones segment, the company has been able to close the gap with market leader Samsung as of July-September quarter of 2023. According to Canalys, Xiaomi shipped 7.6 million smartphones during the quarter, and had a market share of 18%.“The reset, refresh, recharge strategy has truly worked out for us in the second half of 2023…In Diwali season, the overall 5G smartphone sales grew by over 200% year over year. Our smart television shipments grew 3.6 times during the Diwali shopping season,” Muralikrishnan said.

Some of the company’s products that received strong response last year were Redmi 12 5G, Redmi Note 12 5G, Xiaomi Pad 6. The number of smartphones launched by Xiaomi last year was 40% less compared to 2022, Muralikrishnan said, adding that the company will also continue to focus on smartphone launches across price points going forward.

“There is an opportunity at every price point to have compelling 5G offerings… our aspiration would be to play across all price points while staying true to the core mantra of having a winner product in all key price categories and not overly cluttering the portfolio,” Muralikrishnan said.

Besides the premium category, Xiaomi sees a strong 5G market opportunity in the sub-`10,000 as well as `10,000-15,000 segment. In 2024, Muralikrishnan expects the overall smartphone marketfor the industry to grow in singledigits largely driven by 5G. “Wewould like to be at the forefront (in 2024),” he added.

On plans to regain top position again, Muralikrishnan said, “I am not saying I don’t want to be number one. But the focus has changed, rather we would love to be trusted and preferred by customers. And number one, can be an outcome metric of that and we would be happy to take it.” Recently, Xiaomi tied up with Dixon Technologies to manufacture its smartphones in India.