New Delhi: The local arm of Chinese technology company Xiaomi Corp. has fine-tuned its strategy for the home appliances category and aims to launch washing machines, refrigerators and water purifiers for the Indian market.
“This year we will probably enter big categories such as water purifiers, laptops, and washing machines. Additional launches will include two to three small categories as well," said Manu Jain, managing director, Xiaomi India.
Last year, Xiaomi introduced its range of TVs in India, which are being locally manufactured. It hopes to get a bigger share of the country’s ₹1 trillion consumer durables market, with the proposed launches, as it seeks to grow beyond smartphones where it already holds the top spot. The Beijing-headquartered firm became the market leader in smartphones jointly with Samsung Electronics Co. Ltd in the third quarter of 2017 and has been a clear leader since then.
According to data from International Data Corp., Xiaomi had 28.9% share of India's smartphone market in the fourth quarter of 2018.
“We now have nearly 30% market share in smartphones, which was till now our fastest growing business. However, if we launch categories such as washing machines, fridges, and water purifiers, we can disproportionately grow that and capture a bigger market share," Jain said.
For the year ended 31 March 2018, Xiaomi India posted a turnover of over ₹23,060 crore, up from ₹8,379 crore in the year-ago period, according to data from Tofler, a company research platform.
Smartphones still account for a bulk of the company’s turnover in India, which sells products such as audio sets, smart scooters, drones and powerbanks in China.
Analysts tracking the sector feel Xiaomi products will benefit from the large business it has built online for its smartphones. The company retails its products in India through Amazon, Flipkart, and its own Mi website, apart from selling them through offline stores.
“How consumer electronics are being sold in India will further change because of online sales. E-commerce companies such as Flipkart and Amazon have already helped push the sales of large appliances online. With Xiaomi having a strong presence on these websites because of its smartphone sales, it makes sense for it to extend its Chinese product range in India and leverage that network," said Shubham Anand, retail, e-commerce, and omnichannel lead at consulting firm RedSeer.
The shift of Indian consumers to “smart electronics" will help a brand such as Xiaomi, which already sells such products in China, Anand said. Some of these products could be launched by December this year, said Jain. “We are working on each one of them but I do not know which one will be ready first," he said.
The company will take a call on imports and local manufacturing once the new product range is finalized. “We may think of importing a small quantity in the beginning and then move to local manufacturing soon. Or we can start from local manufacturing from day one," Jain said.
Xiaomi already sells through a network of retail stores in India under Mi Home stores (over 50) and 5000 Mi preferred partner stores, which are small multi-brand shops that stock a large inventory of Xiaomi smartphones apart from other phone brands.
It will leverage both online and offline retail formats to push the sale of its white goods.
“Our Mi preferred partners, which are small mobile shops sized 200-600 sq. ft, are already selling Mi TVs," said Jain.
The company is also working on increasing its offline presence across small towns and rural India with a planned expansion of 5,000 franchised stores over the next one year.