Samsung has become the leading smartphone vendor in India, surpassing Xiaomi during the fourth quarter of 2022. Samsung’s focus on meeting Indian consumer expectations with feature-rich models and innovative financing options has played a significant role in its success. In contrast, Xiaomi’s focus on selling phones priced under INR 10,000 ($120) failed to keep up with the “upmarket” trend in India, resulting in a decline in its market share and increased scrutiny from the Indian government.
Samsung’s program with financing partners provides “convenient and guaranteed” loans to those with no loan history, low credit scores, or no pay stubs, which helped it generate $1 billion in phone sales last year. This program has played a significant role in Samsung’s recent success in India.
Xiaomi is overhauling its strategy in India and shifting its focus towards high-end smartphones, as the company has admitted to launching too many models in the past. In January 2023, Xiaomi launched the Redmi Note 12 series, which costs over INR 30,000 ($365) for the top variant. The shift in strategy appears to have been immediate, with sales of the Redmi Note 12 reaching $61 million in its first two weeks on the market.
The Indian market has 626 million smartphone users, making it the second-largest market after China. Companies that fail to cater to changing consumer preferences in a fast-growing economy with rising disposable incomes will be penalized. Xiaomi’s loose grip on the Indian market highlights this point, and the company’s inadequate response to changing consumer preferences has resulted in a decline in its market share and increased scrutiny from the Indian government.
Samsung’s innovative financing options and feature-rich models have helped it become the number one smartphone vendor in India, indicating that companies that focus on meeting consumer expectations can succeed in this market. With the Indian smartphone market projected to grow, Samsung’s focus on catering to Indian consumers’ preferences could help it maintain its leading position in the years to come.
