Xiaomi, the Chinese smartphone maker that has been ruling the Indian market for the past few years, is now eyeing the lucrative premium segment as it marks its 10th anniversary in the country. The company, which started as an Internet firm in 2010, has grown to become the second-largest smartphone brand in India, with a 26% market share in 2023, according to IDC.
However, Xiaomi faces stiff competition from rivals such as Samsung, OnePlus, and Apple in the premium segment, which is defined as above Rs 30,000. According to Counterpoint Research, Xiaomi had only a 3% share in this segment in 2023, while Samsung led with 34%, followed by OnePlus with 25%, and Apple with 23%.
To change this scenario, Xiaomi has announced a three-pronged strategy to cater to the growing aspirations of the Indian consumers, who are looking for more than just affordable devices. The strategy includes launching flagship phones with cutting-edge technology, building a connected ecosystem of smart devices, and delivering a holistic user experience through its HyperOS software.
Xiaomi India president Muralikrishnan B told ET that the company has crafted a strategy to cater towards the growing aspiration of the nation, in a bid to be the “preferred and pioneering choice for the aspirational Indian,”[^1^][1] adding that the company will be following this strategy over the next three years.
As part of its premium push, Xiaomi has recently launched the Mi 11 series in India, which features the Snapdragon 8 Gen 3 chipset, a 120Hz LTPO display, and a Leica-branded camera system. The Mi 11 Ultra, which is the most expensive phone in the series, is priced at Rs 69,999, and competes with the likes of Samsung Galaxy S21 Ultra and iPhone 12 Pro Max.
Xiaomi has also expanded its portfolio of smart devices, such as smart TVs, laptops, wearables, speakers, and IoT products, to create a connected ecosystem that can be controlled through its Mi Home app. The company claims to have over 50 million connected devices in India, and aims to add more categories in the future.
Additionally, Xiaomi has revamped its software experience with HyperOS, a custom Android skin based on AOSP, which offers a smooth and minimalist user interface, with features such as Hyper Mode, Hyper Vision, and Hyper Connect. The company says that HyperOS is designed to enhance the performance, battery life, and security of its devices, as well as to integrate its ecosystem products.
Xiaomi's premiumisation strategy comes at a time when the Indian smartphone market is witnessing a shift in consumer preferences, as more people are willing to spend more on their phones, especially after the pandemic-induced digital transformation. According to IDC, the premium segment grew by 143% year-on-year in 2023, and is expected to grow further in 2024.
However, Xiaomi will have to overcome some challenges to succeed in this segment, such as building a strong offline presence, improving its after-sales service, and enhancing its brand perception. The company will also have to deal with the anti-China sentiment that has been prevalent in India since the border clashes in 2020, which has affected the sales of some Chinese brands.
Xiaomi, however, remains confident of its prospects in the premium segment, and believes that its loyal fan base, innovative products, and value-for-money proposition will help it achieve its goals. The company also plans to celebrate its 10th anniversary in India with various initiatives, such as launching special edition devices, offering discounts and offers, and engaging with its Mi fans and community members.
