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China's smartphone maker Xiaomi set to dial India, to enter 10 countries in 2014

The Economic Times:  April, 2014

New Delhi: Smartphone maker Xiaomi is all set to enter India this year, making it the sixth brand from China to pitch for a share of the highly competitive market which is counted as among the world's fastest growing. "Xiaomi is coming to 10 countries in 2014. Malaysia, the Philippines, India, Indonesia, Thailand, Vietnam, Russia, Turkey, Brazil and Mexico," the company said through its official handle @xiaomi on micro blogging site Twitter, where it has over 14,000 followers.

The announcement comes a day after the device-maker that only sells online changed its website to mi.com and just a month after president and co-founder Lin Bin and vice-president and head of overseas expansion, Hugo Barra, visited Delhi for a series of meetings, including one with Google India's top executives.

India's smartphone shipments in 2013 swelled 181% year-on-year to 41 million and is expected to double this year, underlining the huge growth potential for smartphone makers.

However, Xiaomi will face multi-fold competition from international phone makers, including Samsung, Apple and Sony, home-bred companies such as Micromax, Karbonn and Lava, besides other Chinese brands Gionee, Huawei, ZTE and Lenovo that are aggressively marketing their products to consumers.

"One of the key success factors for Xiaomi in China (apart from devices with high end features at affordable costs) is that they've successfully managed to engage the consumers in their product development and marketing," said Jayanth Kolla, co-founder and partner at telecom research firm Convergence Catalyst.

They have a strong and loyal customer base, who provides key inputs on Xiaomi's devices and services features.

If they manage to replicate this model in India, they'll be highly successful, he added. He noted that most of smartphone makers in India primarily focus on devices sales and invest very little in customer engagement.

"The youth in India has matured in terms of smartphone ecosystem and any company that can tap their feedback and engage them in return will be successful in this market," Kolla said.

Xiaomi has a few other advantages that may work in its favour. If it launches sales online - a model that it has adopted so far - it will save on distribution costs.