Smartphone maker Xiaomi targets the Indian consumer ahead of global push
Chinese smartphone maker Xiaomi has no plans to extensively expand into the US and European markets as it wants to focus on India in its global strategy, founder Lei Jun said.
“As a start-up, Xiaomi created a miracle over the past five to six years but we have developed too rapidly. We need to consolidate the Chinese market and be more focused on the India market under out global strategy,” Lei said in Beijing Monday.
India was a big market that had huge demand for “value-for-money” smartphone models, he said.
Data released by research firm IDC showed that Xiaomi’s market share in India in terms of smartphone shipments was 3.5 per cent in the fourth quarter last year, ranking No 7, lagged behind Apple Inc. with a 4.6 per cent market share.
Lei said that Xiaomi hoped to be one of the top three smartphone markers in India. The company also wants to explore other business opportunities in India, he said.
Xiaomi recently launched in China its new flagship model Mi 5, the first in ite line up to feature near field communication for mobile payments. The company said it would launch the new model in India next month, becoming the first foreign market to debut the Mi 5.
Last year, the Chinese smartphone company teamed up with Taiwan-based tech company Foxconn to start assembling phones in India.
Xiaomi hopes to become a global company and plans to continue “going out” patiently, Lei said.
“Globalisation cannot be achieved overnight. Our plan now is to do well in India, but not to expand into too many other markets,” he said.
As a top smartphone market at home, Lei said Xiaomi also needed to address the company’s shortcomings after years of rapid growth. It will boost innovation and product development to improve the user experience, he said.
Xiaomi’s smartphones are popular among Chinese consumers as its models are generally cheaper than its rivals. The Mi 5, which costs 2,699 yuan, is about 30 to 50 per cent less than the cost of a similarly-featured premium model from Samsung Electronics, Apple or even Chinese electronics maker Huawei.
“We can set prices lower as industrial advancement helps lower costs,” Lei said.
Meanwhile, Lei said Xiaomi had not set a time frame for an initial public offering.
“Xiaomi is a long-lasting company. We want the IPO to be a natural process,” Lei said, adding that the company had about 10 billion yuan (HK$1.19 billion) in cash.
Lei added that a public listing would place limitations on the company in the form managing shareholders’ expectations.
Lei, a deputy to the National People’s Congress, has urged the Chinese legislature to hasten development of internet infrastructure in rural areas. He said the increased internet access would offer huge potential for technology start-ups in an untapped market.