Xiaomi’s Tag Of Number 1 Smartphone Brand in India Came to an end

Xiaomi’s Tag Of Number 1 Smartphone Brand in India Came to an end

Getting success is easier than to sustaining success. The downfall story of Chinese smartphone company Xiaomi is one recent example in Indian market. Allegations, income tax raid and resignations of first slab leaders in a bulk broke the market trust on the brand. Then the golden ruling era came to an end. According to the market analysis firm Canalys’s quarterly report based on Indian smartphone market, “after 20 quarters, Xiaomi lost its leadership position in Q4 2022 and fell to third place with shipments of 5.5 million units”.

Allegations and Resignations

5 years back, in pre-pandemic India the smartphone market was abuzz with the Xiaomi’s ‘value for money’ handsets with aggressive pricing structure, leading to a loyal customer base. The brand ruled the market for almost half a decade in a row. Then the news broke out stating about Indian government’s Enforcement Directorate (ED) sue against the allegations for violating the law of Indian Foreign Exchange. The Chinese company was caught in the case of illegal transfer of ₹5,551.27 crore to three foreign entities whereas no goods or services were availed in return. According to the ED reports, Xiaomi did that under the instructions of its Chinese parent group. Assets worth over ₹ 5,500 crore were seized, stating the banks were provided with misleading information to solve the purpose.

Above all, top executives started leaving the firm siting personal reasons, started with, India head of the company Manu Kumar Jain who then shifted to Dubai, after submitting resignations, and Chief Business Officer Raghu Reddy also left the company giving reasons to “pursue different growth opportunities externally” to name a few.

Vivo Took Hold of the Market


Aftermath of this incidence resulted as Vivo’s gain as in Xiaomi’s loss. If the Canalys’s reports to be believed, Samsung became the no1 mobile phone company in Q4 2022 after Q3 2017. It shipped 6.7 million sets that was 21% of the total market share. Vivo took the second place by shipping 6.4 million sets. Realme and Oppo (including OnePlus) sustained at fifth and fourth place as they shipped 2.7 million and 5.4 million sets respectively.

Research Say…

Canalys analyst Sanyam Chaurasia revealed that mobile phone brands that relied on online medium suffered the most. “Vendors that were focused predominantly on online channels suffered from a poor e-commerce festive sales performance in Q4 2022,” stated Mr. Chaurasia. He further added, “Xiaomi aimed to clear out inventory of its older models using the eCommerce channel. But, due to poor e-commerce festive sales performance, Xiaomi and Realme saw significant stockpiling of their products in online channels in Q4 2022.”

Meanwhile, Vivo and Oppo kept their focus on retail channels, helping themselves to make the better profits and grow YoY, as stated by Mr. Chaurasia.
At the end, India’s smartphone market saw a ‘never seen before’ hit during the holiday period that falls in fourth-quarter of the year, dropped down by 27%, noted Canalys.

Xiaomi in the Entire Year

Meanwhile, if the entire year shipment of units is calculated, then it is Xiaomi that holds 20% of market share and emerged as top seller, Samsung at second with 19% share. Alongside, Realme, Oppo and Vivo respectively secured respectively 14%, 15% and 17% of market share. At the end, Indian smartphone market declined by 6% that is 151.6 million units as compared to 2021.

Xiaomi Lost

A loyal customer base, largest market share, trust hold on technical built and right infrastructure are some of the basic requirements for the firm of a digital tool to establish business and lead the market. Xiaomi owned them all, and thus the Chinese mobile manufacturing firm ruled Indian cellphone market from 2017-2022 for almost half a decade. And then, the golden era saw the downfall as it lost its reputation in the market.

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