Xiaomi’s New Policy Mantra for India: Think Global; Act Local
World’s third largest smartphone vendor, and ‘Apple of China’, Xiaomi has taken a unique business and marketing approach, which is enabling them to soar newer heights of success and growth.
It seems that their sole focus right now for Indian market is : Think Global but Act Local.
A Chinese based technology publication has claimed that Inventec, a Taiwan-based original device manufacturer (ODM) is now all set to establish a production facility in Chennai, which is going to start delivering from 2nd quarter of 2015.
Inventec manufacturers mobile phones, tablets, servers and laptops, and as per insider news, their new facility at Chennai would be exclusively devoted for Xiaomi products.
Earlier we had reported that Xiaomi is looking for potential partners for assembling their units in India. Manu Jain, Head of Xiaomi’s India operations had said, “We’ve started talking to some potential partners to see if they can assemble the phones for us in India,”
But now it seems that they are all set to start the manufacturing and assembling with the aid of Inventec. Foxconn, which is another Xiaomi’s vendor for supplying handset components had a factory in Chennai, which they closed down in December. As per industry watchers, Inventec may start their operations from the very same factory.
Talks are also on for establishing their R&D center in Bangalore, which would be first such center outside China.
Marketing & Sales
Xiaomi launched their operations from India via exclusive partnership with Flipkart. They conducted flash sales, which lasted only few seconds and enabled thousands of handsets getting picked up by eager technologists and enthusiasts from India.
On July 29th, they managed to sell 10,000 units in 5 seconds, On August 5th, they sold 15,000 units in 2 seconds and on August 12th, 20,000 handsets were sold within 2.4 second.
And now, they are planning to launch their website in India, where they will sell their own handsets. Although their exclusive partnership with Flipkart won’t abruptly end, but their major focus on all marketing and sales activity would be through their own website: Mi.com.
Interestingly, besides India and Indonesia, Xiaomi sells their handsets their own website, all over the globe.
Manu Jain recently said, “We are currently looking for warehousing and logistics partners in India, as well as deciding on a payment mechanisms like cash on delivery. It may take anywhere between three to nine months”, adding, “We have always stated that India is one of our most important markets. We are big plans for India this year..”
After Indian Air Force issued a warning against Xiaomi’s smartphones owning to national security issues, this local policy of Xiaomi is certainly interesting case study of how ‘acting locally’ can help a business.
And still, problems persist for Xiaomi. Ericsson has again sought Indian Judiciary’s help in stopping Xiaomi’s handset sales in India, as they are violating patent rights. We had reported that court has directed Xiaomi to sell Qualcomm handsets only till January 8th, which as per latest complaints from Ericsson, they are not following.
Last year, Xiaomi sold 178% more smartphones compared to 2013, an increment which very few companies in the world are capable of achieving. Their out of the box marketing strategies such as flash sales, powered by inciting hidden persuasion techniques, along with local partnerships and manufacturing plans is working exceptionally well for their sales growth.
They are thinking globally, but are acting locally; and their bet is paying off fine. Xiaomi is right now valued at $45 billion, making it the world’s highest valued technology startup.