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Xiaomi aims to repeat smartphone success with smart TVs
Vivek Phadnis
DHNS
Last Updated IST

Xiaomi’s gameplan for India is working well and this is evident in them occupying the number one slot in the smartphone market for seven quarters in a row. The first phase of their success story was scripted when they took on the big players in the smartphone category.

According to data from Counterpoint Research, the Chinese company has been the leader in India when it comes to smartphone shipments from the last quarter of 2017. The only exception was in Q2 2018 when they shared the top spot with Samsung at 28%.

After their smartphone success, Xiaomi is now taking on the smart television market. Here too, they have met with success and have been the leaders in the smart TV market for the last five quarters.

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Xiaomi has beaten LG, Samsung and Sony to become the No 1 brand for smart TVs in India. Xiaomi says that according to IDC data, they have a 32% share as compared to 14% of LG, 13% of Samsung and 12% of Sony.

“We have been the No 1 smart TV brand since Q2 last year. With the new set of TVs, we hope to continue that bit,” said Eshwar Nilakantan, Head of Mi TV Business, Xiaomi India. “We have helped in the adoption of the smart TV. Before we launched it, the shipment of smart TVs in the market was at 18% as compared to overall TV shipments. Now, that figure is 43% and a very large part of that jump is because of Mi TVs,” he added.

Taking on the likes of the global giants and clinching the top spot is a notable achievement. Asked if Xiaomi is turning out to be a force to reckon with, Raghu Reddy, Head - Category and Online Sales, Xiaomi India, preferred to look at things from another angle.

“The focus is the consumer and we are customising hardware, software and content according to their needs. A classic example is the new data saver feature that is not found outside India. Mobile data is cheap but there is also a daily quota and wired broadband penetration is very low right now. So, we don’t react to competition. The idea is to keep the consumer at the centre and design the products accordingly,” Reddy said.

“Every brand has its own philosophy as to how they want to price it. At Xiaomi, we have already established that at a hardware level and do not want to make more than 5% gross profit.

Meeting consumer aspirations

“We do not want to make money on hardware because we are an internet services company. We hope to make money on, say, software and that is why our major focus is on content for the TVs. At the end of the day, consumers have a need and want to buy a TV of a certain size and budget. Xiaomi tries to match those aspirations of the consumer,” he added.

The Xiaomi officials said that the objective of launching new TV models had two main objectives. “We have launched the new TVs hoping to further expand our share. In our current portfolio, there is the 32-inch Mi TV 4A Pro priced at Rs 12,499. Then, we have the 43-inch Pro priced at Rs 21,999, 50-inch at Rs 29,999 and 65-inch at Rs 54,999. We realised that there is a massive segment that buys TVs between these two price points. That is why we launched the 4A 40-inch Full HD at Rs 17,999,” said Reddy, who gave further similar examples of how they are trying to make inroads in other price segments.

“We are trying to make sure that there is a relevant and best-in-class offering at any budget. It should hopefully help us grow further. But from the growth standpoint, we are very early into this journey. We started selling with no TVs in February last year and are consistently growing. Since we are in this growth phase, we have not had much of an impact (of the economic slowdown), but it remains to be seen as we go into the festive season,” he explained.

The other strategy Xiaomi is actively working on is offline sales. “In the offline space, we started in earnest only this year,” said Reddy.

Nilakantan added: “This year, the offline channel is growing faster than online from a TV standpoint. We have also expanded into the Mi Store in Tier-3 and Tier-4 markets, which have historically been underserved.

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(Published 22 September 2019, 20:07 IST)