Xiaomi founder Lei Jun credits Make in India for company’s success here

By: | Published: November 20, 2017 6:10 AM

Lei Jun might not be recognised by many in India. But mention his company Xiaomi and everyone knows the smartphone brand which now has the same market share as long-time market leader Samsung.

Xiaomi founder Lei Jun (Reuters)

Lei Jun might not be recognised by many in India. But mention his company Xiaomi and everyone knows the smartphone brand which now has the same market share as long-time market leader Samsung. Nandagopal Rajan speaks to serial entrepreneur Lei Jun on Xiaomi becoming No 1 in India, improvising for the local market, Make in India and innovation in the smartphone segment.

How does it feel becoming the largest smartphone manufacturer in India? Has it happened faster than you expected?

In April 2015, I had expected us to take three to five years to become No 1. Actually, it took us just two years and one quarter. It is something very exciting. It really means the Indian consumers could resonate with the Xiaomi brand, the Xiaomi products and our values.

What do you think is the primary reason for this success?

There are three elements behind this success. One, high-quality products; two, our honest and affordable pricing; and three, our very strong local team lead by Manu Jain participating in the ‘Make in India’ programme. All these elements are recognised by the Indian customers. Even though we are a global company, we are also a very localised Indian company. Since the day we entered the market, my instruction has been that we have to become a local Indian company.

Xiaomi has had this very unique marketing strategy. Did you have to improvise that for the Indian market?

First of all, we are an e-commerce company. So why do we make an e-commerce platform? Because of its high efficiency. It takes a lot of cost to make a great-quality product. If you want to sell it affordably, you need to use the technology of the Internet and e-commerce. Since the beginning of this year, we started entering offline in a big way, but we are very different from the other traditional smartphone companies as we are doing new retail. This is the concept that global juggernauts like Amazon and Alibaba have been talking about, the new retail. We can actually make these products very affordable offline as well. That is why we would never go to a traditional retail model. So how do we do new retail well? The first example is MiHome. In India we now have ten of them with huge footfalls and each store selling a huge number of phones. The first store in India sold 20,000 phones a month, it is a big miracle in the retail industry.

What are your big learnings from the India market? Are you taking these learnings to other parts of the world?

We have some great innovations in this market. For instance, the Mi Preferred Partner Programme is something the local team came up with and is now being implemented in other markets. A lot of our global leads have come to India to learn these concepts.

How do you look at the Indian environment when it comes to ability to do business here and the lack of a component ecosystem here?

India also needs to take a step-by-step approach to develop the manufacturing industry. Two decades ago, China also followed the same step-by-step approach – start with assembly and slowly go to localisation of components. We have been trying to encourage our suppliers to start their factories in India. We already have a few of our factories set up in India and a few more that are being set up as our capacity has been reached. I think some component suppliers also will set up factories in India. But this takes time, PM Modi’s ‘Make in India’ campaign is a visionary project that will improve India’s industrial capabilities, solve employment issue and develop the economy.

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