Xiaomi India Shifts from Volume to Value to Regain Ground

Once India's top smartphone player, known for affordable, high-spec devices, Xiaomi has reworked its strategy to introduce premium smartphones and expand into consumer electronics, to arrest its declining market share amid a demand shift toward higher-priced phones.

As per data from market research firm Counterpoint Research, Xiaomi's market share halved from 26% at the end of 2020 to 12% in Oct-Dec 2025, while rivals such as Vivo and Apple have gained ground on the back of rising demand for premium devices.

To reverse the slide, Xiaomi has lined up an aggressive product offensive this year. The Chinese smartphone maker has introduced its Xiaomi 17 smartphone, along with the 17 Ultra, was launched globally at the Mobile World Congress Barcelona, along with the tablet Xiaomi Pad 8. The devices will be available in India by this month. It was first launched in China September, 2025. Earlier, Xiaomi had announced the mid-segment smartphone Redmi Note 15 and the 75-inch 4K QLED smart TV Xiaomi QLED TV X Pro 75 in the Indian market.

“In 2025, we moved from a volume-driven strategy towards a value-driven strategy. We recalibrated our entire strategy. And 2026 is about taking that strong momentum forward and stepping further into our premiumisation journey,” Xiaomi India Chief Operating Officer Sudhin Mathur told Outlook Business in an exclusive interview.

This push comes as India's premium smartphone segment (devices priced above ₹30,000), emerged as the fastest-growing in 2025, expanding 11% year-on-year and accounting for 22% of overall shipments, the highest share ever recorded.

Mathur acknowledges this shifting consumer preference.

“Over the last three years, consumer preferences have shifted. People have now used their first, second and even third smartphones, and their expectations have grown significantly,” Mathur notes, explaining the shift in consumer preference. He adds that earlier, the key reasons to purchase a phone were bigger megapixels, a larger display or a bigger battery.

“Now, the shift is from value for money to value for experience. It’s no longer just about having a 50-megapixel camera; it’s about what it can actually do. It’s not just about a 6,000 mAh battery; it’s about how long it truly lasts. AI has become a feature that almost everyone wants. The transition is clearly from feature-led to experience-led, and that shift is slowing replacement cycles,” the Xiaomi India COO said.

According to him, people are now holding on to devices for more than two years, compared to eight to twelve months earlier.

This slowing replacement cycle has also led to a broader growth slowdown in the Indian smartphone market. A Counterpoint report from February 2 shows that India’s overall market grew a modest 1% year on year in volume terms, but as premiumisation kicked in, the value of the market was up 8% YoY.

“However, this is not a worry for us or the industry,” the Xiaomi COO told us. While volumes may have tapered and are not growing rapidly, as per Mathur, unit sales remain stable and the average selling price is rising, which shows consumers are willing to pay more for better devices.

“With easy EMI schemes available today, buyers are comfortable spreading payments over nine to twelve months to own a better phone that lasts longer and delivers a superior experience. We see this more as an opportunity than a concern,” he further added.

Revamping Leadership

In 2025, the company also underwent a leadership restructuring, with mid-level leadership roles reorganised into new zonal divisions and sub-brand Poco’s management merged with the main Xiaomi team.

“Structural changes within the organisation are an ongoing process, not really a strategy in themselves... That’s the larger perspective behind such changes,” said Mathur. He explained that for Poco, the shift is more about “aligning common resources”, such as having a shared marketing team.

“Earlier, Poco had a largely independent sales focus because it was more online-centric. Now, it’s about clearly articulating the three sub-brand strategies and their value propositions to consumers. The restructuring is aimed at ensuring common messaging and better use of internal resources, rather than duplicating roles,” said Mathur.

Expanding Product Portfolio

According to the Xiaomi COO, the launches are aimed at taking the journey of premiumisation forward “not just in phones, but across the ecosystem category”.

In China, Xiaomi sells more than 200 categories, while in India it has just about 10–12 such products.

“We have already launched some of them (out of 200 products) in India and they are doing very well. For example, our air purifiers do extremely well. We have Robo Vacuum Cleaners and garment steamers... We will continue to explore market fitment and expand accordingly,” said Mathur, though he declined to give any specific timeline for the same.

He did note that the global unit gets more than one-third of its revenue from non-phone categories like TVs, refrigerators, washing machines, as well as Electric Vehicles (EVs). For Xiaomi India, non-smartphone products contribute about 15% of revenue. Reaching that level in India, according to COO Mathur, is more about the right strategy than the timeline.

“Globally, we have more than 20 million users who own more than five Xiaomi products, it could be a phone, tablet, vacuum cleaner, air purifier or anything else. In India, during our 10-year milestone (2020), we shared that we have sold close to 25 million phones and 10 million non-phone ecosystem products,” he explained.

The company already saw a sixfold jump in QLED sales last year, with a 200% year-on-year increase in the contribution of 55-inch and larger TVs, while tablets recorded 2x growth.