After China, Xiaomi plans to conquer India next

Xiaomi has been having a great week, having sold over $163 million worth of phones in just 12 hours, nearly doubling its revenue and profits compared with last year, and securing additional loans and investments to expand its growing business. Following its quick rise to the top in China, this seemingly unstoppable force has its sights firmly set on India.

According to the company’s Vice President, Hugo Barra, the move into India isn’t just about selling phones. Obviously that a major part of the plan, but building and establishing a brand that can survive in the country for the long term is the goal. Barra himself has relocated to Bangalore to oversee the expansion and has gone into some detail to explain about plans for scaling up production, setting up a region specific base of operations, and cultivating a separate Mi India brand specifically for the country.

We are here not to sell phones and dominate. We are here for the long run, and we want to brand ourselves into the fabric of this country. We need to start small, we need to listen, iterate.

So we take our time, we ramp up carefully; we take feedback very, very seriously. The whole operation has to scale, we can’t just have a sales spike.

FlipKart will remain the company’s ecommerce partner in the region, as it has been a driving before behind the company’s ability to sell at lower prices that its competitors. There are also talks of moving some of Xiaomi’s software development into the country, as well as looking for local manufacturing partners. Xiaomi doesn’t plan to just export smartphones, it’s setting up a dedicated operation in India.

We will, for sure, write software here. We certainly are also considering the possibility of manufacturing through partners. We don’t make products ourselves. We use Hon Hai Technology Group (Foxconn) and others to do the manufacturing for us. We are here for the long run and it might make a lot of sense to be able to make [devices] here.

As well as manufacturing and logistics, Xiaomi’s plan involves bringing its extended range of services over to the country. Additionally, Xiaomi has a few India specific changes to its software in mind, including integrating Truecaller’s dialler into its products and methods to easily top-up and check your call balance online.

We want to build an Internet platform that is delivered through these devices. We plan to partner with a whole lot of companies and build layers of services into the operating system. 

Xiaomi is already off to a strong start in India. The company’s initial sales forcast of a few thousand phones has already boomed to volumes of up to 100,000 units per week. As for future products that matter to consumers, Xiaomi is planning to bring the Redmi Note to India next, followed by the Mi4 and its 4K 49-inch TV.

The contest for India’s smartphone market is only just heating up.