Xiaomi looks to ramp up offline distribution in India

Chinese handset maker Xiaomi said it plans to ramp up its offline distribution channel in the country and is targeting around 25 per cent of its turnover from this segment.

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Chinese handset maker said it plans to ramp up its offline distribution channel in the country and is targeting around 25 per cent of its turnover from this segment. “Till now, our focus was on online sales. Now, we will focus both on online and offline distribution. We expect our share from offline to grow from current 10 per cent to 20-25 per cent by the end of this year. This is our aspiration,” India Head Manu Kumar Jain said.

Jain said the company has strong plans for offline distribution. “In five or six cities, we are ramping up and having extensive offline distribution and Chandigarh is one of them as it is a key market for us. In the next 3-4 months, we will start a very extensive offline distribution business in Chandigarh through multi-brand outlets.

“We will go deep and we will have much deeper penetration in cities like Delhi, , Chennai and Chandigarh,” he said. To a query, Jain said, “At some point in time, we may open our own branded outlets. But not right now.”

Currently, Xiaomi, which crossed the $ 1 billion revenue mark in India last year, is selling mobile handsets through 8,500 multi-brand outlets across the country. Significantly, the mobile handset maker is getting more than 90 per cent of sales from online platforms like Flipkart, Snapdeal and mi.com.

Jain said unlike other brands, the company has reduced the layers of distribution which leads to cost savings. “We cut down two-three layers of distribution network and by that we save money and then this money is passed on to consumers and that is why our phones are affordable,” he said.

With the launch of Redmi Note 4 , the company is hoping to double its sales compared to that of Redmi Note 3.

“We sold 3.6 million units of Redmi Note 3 during March till December 2016. The Redmi Note 4 has better battery, better camera, latest processor… we are expecting almost double of what we did with Redmi Note 3,” said Jain.

The company last month rolled out Redmi Note 4 at a starting price of Rs 9,999 (2 GB RAM/ 32 GB internal memory). The other two variants — 3GB RAM/32GB memory and 4GB RAM/64GB memory — are priced at Rs 10,999 and Rs 12,999, respectively.

Jain said the company is expecting 30 per cent market share in online sales during the fourth quarter (October – December 2016). He said during the July-September quarter, Xiaomi registered 22 per cent market share. Besides smartphones, Xiaomi also sells products like air purifiers, fitness bands and power banks in India.

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