Xiaomi on Tuesday announced its foray into the Indian market with three smartphones priced between ₹6,999 and ₹13,999. The flagship Mi3 smartphone comes with a 5-inch screen, 2.3GHz Qualcomm Snapdragon processor and other features found in top-end smartphones in the market.

While Xiaomi has got the pricing right to take on established players, it has to deal with perceptions around Chinese phones and providing after sales support. Xiaomi has launched the phones on Flipkart and plans to stick to e-commerce retail model. BusinessLine spoke with Lin Bin, Co-founder of Xiaomi Inc, to know how the company plans to take on the Indian market.

What made you decide to launch in India now?

I wanted to come here sooner. There are a lot of similarities between Indian and Chinese consumers. Both want great products at really competitive price. In e-commerce, we believe that India is moving in same direction. It took China 10-15 years to get e-commerce gateways, but India is moving faster. That’s the reason we believe this is the perfect time to enter. Thirdly, both India and China consumers are used to the habits of buying devices from retail and pre-paid SIM card. The carrier has no control. We want as many people to buy our devices and eventually make money by offering some value-added services on our phones.

But will this model work in India where users tend to download only free services and applications.?

If you look at Internet companies like Google, they don’t make money on search service. It is really about millions of people doing searches everyday and Google making money through advertisements. It is going to be very much like that here in mobile Internet area. It doesn’t have to be consumers who pay for it, but as long as we have consumers using the services, there will be other merchant opportunities which would come.

What services you would be launching in India?

We want to customise all of our services for Indian users. To begin with, we will be bringing just a few. It will be also part of the process that we want to learn from the consumers – what are the services that they want. For instance, we will do specific things – from Bollywood movies to TV shows for different landmarks and States in India. And, also we have some interesting services like the yellow page service. So, we will partner with some of the Indian companies to provide such services.

Would you sell only through online medium?

We will be focusing mostly on online. That’s the model we are good at. Even in China, we don’t have our own retail store. We do carrier stores who are selling through their networks. We have similar plans in India and are in talks with various telecom service providers. But, we will mostly focus our energy on e-commerce.

How do you plan to address after sales service requirements?

That’s the area we took long to work on and we were looking for partners. In China, we have more than 500 after sales service and majority of them are authorised by us. To begin with in India, we will have 50 service centres across the country. It is not enough and we want to get as big and as fast as we can. As we start selling we will know about user distribution and we can go and set up service centres there.

Any R&D plans in India?

We want to be Indian company. But as a company goes multinational, there is always a question of ‘do you actually want to run the company the way the headquarters is run or you want to run as a pure company that is zero distance from the end users – understanding the consumer needs on a daily basis’. And, we chose the second part. It’s critical for us to do it and stay zero distance to where our users are. Only by doing that we can insure that all things that we do, we can be with the users.

What kind of market share you are looking at?

We are not after market share. The focus for us is to building services and optimising the products so that we can meet users’ needs. If we do all things right, market share will follow.

How do you address concerns about Chinese companies?

We firmly believe is that ultimately what really matters is the products.

How will get first time users to buy your products, especially with perception that Chinese means cheap?

We are focusing on social media like Facebook, Twitter and other websites. That’s where we are good at. We are open to some offline campaigns, but probably not on a big scale. We will be closely monitoring as people buy their phones and feedback on social media like Facebook, Twitter on any other medium.

Are you able to meet the demand? Supply chain active.

We are getting close to that. We are certainly getting better what we used to. We are producing five-six million phones a month, which is just about good to meet our target of selling 60 million phones globally.

Can India become a bigger market for you than China?

I do not rule that out. China with 300 million smartphone users is reaching saturation while in India the growth is just beginning.

It took China 10-15 years to get e-commerce gateways, but India is moving faster. That’s the reason we believe this is the perfect time to enter.

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