“Sure, it’s a good telephone. It has nice specs. It’s nicely designed and appears good. And even the worth is an effective one. However the huge query is: will ANYONE spend that type of cash on a Xiaomi telephone in India? It’s seen as an affordable model.”
The sneer was very clear (and regrettable) in that sentiment that was expressed by many consultants and observers about Xiaomi’s efforts to get past the Rs 20,000 mark within the Indian market with the Redmi Okay20 collection in mid-2019. The explanation for his or her statement was easy – Xiaomi (and its manufacturers, Redmi and Poco) was seen as a “low value, worth for cash” participant. A model whose gadgets would fare nicely within the mid and cheaper price segments. However not past that. As one worthy stated, “Anybody with greater than Rs 20,000 to spare could be loopy to speculate it in a Xiaomi telephone. They’re extra prone to go for a Samsung.”
A “low cost” model? Oh me, oh Mi!
The sentiment for all its rationale had an nearly caste-ist ring to it – a “how dare a Rs 15,000 telephone model make a costlier telephone and attempt to be premium” contact. It additionally mirrored the mountain Xiaomi needed to climb to make its presence felt past what was seen as its “core viewers” – the one within the Rs 15,000 and beneath value phase. And a pattern of simply how powerful this process may very well be was seen inside days of the launch of the Redmi K20 series when quite a few observers complained on-line that the Redmi Okay20 was overpriced at Rs 21,999 and Rs 23,999. Such was the extent of hysterical outrage across the pricing that Xiaomi’s India head Manu Jain issued a press release making an attempt to elucidate the worth.
Whereas the Okay20 collection paradoxically (given all of the hullabaloo round it) did reasonably well, it clearly didn’t take away the “Xiaomi is a low priced model” notion in lots of quarters. And when Xiaomi launched the Mi 10, the Mi 10T, and the Mi 10T Professional final 12 months, the gadgets have been once more subjected to the “Sure, they’re good however will anybody make investments that type of cash in a Xiaomi system” tirade. In our piece on the problem Xiaomi confronted as regards costlier gadgets in India, we had written:
The consensus in part of the tech group is that Xiaomi doesn’t have the “model picture” to command a premium for its gadgets. To be sincere, Xiaomi itself sowed the seeds for this notion. When it launched the Mi Three in India, its flagship system (though nearly a 12 months previous), at a surprising Rs 13,999 in July 2014. The system was a staggering hit and bought Xiaomi numerous consideration, one thing the model actually wanted at that stage. Nevertheless, it saddled it with a repute of being a “low cost” model, as some analysts selected to time period it.
The Mi 10i and Mi 11X promote nicely
That notion, nonetheless, appears to be altering this 12 months. At the least on the facet that issues most – the buyer facet. And the telephone that seemingly broke the ice for Xiaomi was the Mi 10i. The telephone had been launched at Rs 20,999. It took its share of flak for not having an AMOLED show and once more for being priced on the upper facet (something that was priced larger than the Redmi Observe was thought of extravagant for Xiaomi in some quarters). The telephone, nonetheless, shocked lots of people by being Xiaomi’s highest promoting telephone within the early a part of the 12 months, working up revenues of Rs 400 crores within the first three weeks of its availability – that meant gross sales nicely in extra of 1,50,000 items, which was an considerable quantity when you think about that the telephone needed to take care of the likes of the Nord and Samsung’s wonderful M collection gadgets.
Any thought that the Mi 10i’s success was a one-off was dispelled when Xiaomi claimed to have run up gross sales of over Rs 300 crores for its funds flagship Mi 11X collection, comprising the Mi 11X beginning at Rs 29,999 and the Mi 11X Professional at Rs 39,999, inside 45 days of their launch. As one among our retail sources instructed us “Even when we assume that ALL the items bought have been the bottom variant of the Mi 11X Professional, that provides as much as nearly 75,000 telephones which is a terrific quantity at this value level when you think about you might have Samsung and OnePlus on this zone.”
Mi 11 Lite: the light-weight that bought Mi into the premium middleweight zone
Regardless of this, there was a good bit of cynicism in some quarters when Xiaomi launched its Mi 11 Lite system per week in the past. In contrast to the MI 10i and the Mi 11X collection, which did ship superb spec sheets at aggressive costs (though thought of excessive by Xiaomi requirements), the Mi 11 Lite was very a lot a style-over-substance system. Its largest points of interest have been its extremely slim 6.eight mm body and its weight of 157 grams. Its spec sheet was respectable however hardly spectacular – and there have been many who stated that the lower-priced Redmi Observe 10 Professional collection was really worth for cash than the Mi 11 Lite, which began at Rs 21,999. In fact, it additionally needed to cope with comparisons with the OnePlus Nord CE, which was solely Rs 1,000 costlier however got here with 5G and was a OnePlus.
When Xiaomi’s Manu Jain claimed that the Mi 11 Lite was extra about design and way of life than specs, the sneers have been out once more, full with the “who would purchase a Xiaomi system for fashion” remarks.
One week after the launch, Xiaomi claims to have registered gross sales price Rs 200 crore with the Mi 11 Lite. That’s once more nicely over 75,000 items bought even when we have been to think about solely the higher-priced variant of Rs 23,999. And this in opposition to competitors from the likes of the OnePlus Nord CE, which by the way has additionally been stated to be doing nicely (though OnePlus has not spoken formally about it).
1 / 4 of one million telephones above Rs 20,000 bought (at the least)
Let’s add these numbers up – even when we think about solely the gross sales of the Mi 10i for the primary three weeks, the gross sales of the Mi 11X for the primary 45 days, and the gross sales of the Mi 11 Lite for the primary week, Xiaomi has run up gross sales of Rs (400 + 300 + 200) = Rs 900 crores by way of revenues and (75,000 + 1,50,000 + 75,000) = 3,00,000 items (greater than 1 / 4 of one million items). And all of it has been within the phase above Rs 20,000. The truth is, a big chunk of it (the Mi 11X collection) is within the phase above Rs 25,000. Do take into account that these are figures from solely very small chunks of time. The general figures may very well be a lot larger (if anybody has them, we’d be delighted to see them).
In fact, these figures are usually not in the identical zone as these for its lower-priced telephones, however that may be a rationale that may be utilized to any model (barring Apple and, to an extent, OnePlus) – the overwhelming majority of telephones (nearly 70 %) bought in India are beneath Rs 15,000 (nearly ninety % of telephones bought are beneath Rs 20,000). The typical value of a telephone within the nation is round Rs 13,000. Regardless of the way you take a look at it, Xiaomi has made important inroads into the phase above its “conventional core space.”
Not but a premium participant, however getting there…steadily
Now, it will be untimely to say that which means Xiaomi has shaken off its repute as being a “low value” model, however the numbers can’t be denied both. On the very least, Xiaomi has moved up the notion ladder from being mid-segment to higher and perhaps even premium mid-segment. And given the type of rabid hostility the Redmi Okay20’s value attracted barely two years in the past, that’s no imply feat. Some say that the choice to maneuver the Mi model right into a extra premium phase whereas leaving Redmi and Poco to battle it out for mid-segment honors has yielded wealthy dividends for Xiaomi.
Regardless of the purpose, the actual fact is that with the spectacular gross sales of the Mi 11 Lite, Xiaomi appears to have taken an enormous step in the direction of fixing the premium telephone puzzle in India. A lite-weight has confirmed its entry right into a area past the middleweight phase. Will it be capable of carry this momentum to larger value factors or cling again and consolidate its presence on this new zone? Solely time will.
However as of now, the reply to the “who will make investments greater than Rs 20,000 in a Xiaomi telephone in India” question has been given. And it reads, “greater than 1 / 4 of one million individuals.” Sure, some will proceed to splutter in outrage on social networks), however as a retailer instructed us (it’s a quote we used and is price repeating):
“Twitter pe sale nahin hota hai, bhai sahab. Yahaan hota hai” (“Gross sales don’t occur on Twitter, sir. They occur right here.”)