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Xiaomi goes offline in India

News, 08 January 2015

MUMBAI: Six months after its successful entry into the Indian market, Xiaomi, the leading Chinese smartphone brand, is altering its strategy to embrace sales through stores in addition to its signature flash sales online.

A trial will see one of its handsets – the Redmi Note 4G – being sold in six cities through 133 stores owned by mobile provider Bharti Airtel which is seeking to attract subscribers to its 4G service.

"If this works out fine, we'll expand the partnership to other cities and other devices," Manu Jain, head of Xiaomi in India, told Reuters.

He went on to outline how online sales through Flipkart had already gained the company customers in 1,000 cities, and how it was aiming to achieve a similar balance to that in China where around 30% of sales come through offline channels.

In a market boasting some 280 brands, an offline presence may be a useful way of helping it stand out a little more. That strategy will also be necessary to penetrate some areas of the country according to observers.

"If Xiaomi has to reach out to rural areas and smaller cities, which have lower online populations, they have to have tie-ups with brick-and-mortar stores," said Neil Shah, a director at research and consulting firm Counterpoint Research.

Xiaomi's Indian ambitions are not limited to smartphones, however, as it intends to introduce more of its product lines, including the Mi TV, Mi Band and a router that enables home automation, the Economic Times reported. It is also planning to open its own ecommerce store, Mi.com, to sell directly to customers, and to open 100 service centres.

A new R&D centre – its first outside China – will develop software specific to India. "Cricket and Bollywood are so unique to India — you can build it only in India because of the cultural context involved," said Jain.

"The starting point for us will be to build for India, and then it would not be far away for us to also start building products for other markets, like Southeast Asia and Brazil."

Data sourced from Reuters, Economic Times; additional content by Warc staff