Xiaomi has replaced Samsung as the top smartphone supplier in India in the fourth quarter of 2017.
Xiaomi has 27 percent market share in India smartphone market whereas Samsung has 25 percent.
The success of Xiaomi in India will have far-reaching implications for its worldwide strategy, said said Ishan Dutt, Canalys Research Analyst. Considerable business in China and India, the world’s largest two smartphone markets will build confidence in its channel partners as well as future investors.
Xiaomi has given special focus on localization, channel strategy, marketing and products to win customers over Samsung.
Samsung India has lost its number one position due to its inability to transform its low-cost smartphone products. Samsung is in the process of revamping its low-cost phones and will fight to take back the number one status.
Years ago, Nokia had a similar fate in India and it could not regain its leading position due to its inability to focus on phone innovation, dual SIM phones, channel strategy, among other things. Nokia was later sold to Microsoft.
Xiaomi has shipped 8.2 million smartphone units in Q4 2017. Despite annual growth of 17 percent, Samsung failed to maintain its lead, shipping just over 7.3 million smartphones to take second place.
The smartphone market in India grew by 6 percent to 30 million units, according to Canalys. Vivo, Oppo and Lenovo are the other smartphone companies in top five position. Indian phone makers such as Micromax, Lava, Karbonn, Jio, etc. have lost the relevance to Indian phone customers.
Analyst firm GfK earlier today said India smartphone sales (and not shipments) fell 3 percent in India as low-priced 4G feature phones have cannibalized smartphone sales in the fourth quarter of 2017.
Ishan Dutt, Canalys Research Analyst, said: “Xiaomi’s results are commendable, given it entered the market just three years ago.”
Rushabh Doshi, analyst at Canalys, said Samsung India could not win over cost-conscious consumers, losing market share in the sub-INR15,000 or $240 segment to Xiaomi quarter after quarter.
Samsung offered better margins and funding to the offline channel to create phone consumer demand. Samsung has superior R&D, and a better hold on the supply chain due to its strong components business.