KOLKATA: Samsung and Xiaomi are stepping up their fight in the Indian market with both sides seeking to win over the retail trade. The South Korean company has even stopped supplying its handsets to 200 retailers that entered into an agreement with Xiaomi to become preferred sellers for the Chinese brand’s phones, said several people with knowledge of the matter. Xiaomi expects its smartphones to account for over half of the total handset sales at these retailers.
Samsung’s mid-level sales executives are said to have rushed to retailers across India asking them not to sign up for Xiaomi’s preferred retail partner programme and for the first time are ready to pay for store branding in stores that are next to such outlets, five senior industry executives said. Of the 200 preferred retail partners, half are in the National Capital Region with a total monthly revenue of around Rs 100 crore.
“Samsung executives have informed retailers that they do not want to give an inch of space to Xiaomi due to the increased Chinese aggression already from Oppo and VivoBSE 4.86 % and they don’t want to repeat the mistake they did in China.”
The stakes are high for Samsung considering it has been elbowed out of China, the world’s largest market, by local manufacturers. Online-focussed Xiaomi now wants to expand into the offline market in both India and China to boost sales. It’s expecting 35% of its $2 billion India revenue target to be generated by offline sales this fiscal year.
According to Hong Kong-based market tracker Counterpoint Research, Samsung had a 26% share of the smartphone segment in the January-March quarter with Xiaomi for the first time jumping to the second spot with a 13% share.
The other Chinese companies followed — Vivo (12%), Oppo (10%) and Lenovo-Motorola (8%).
A business partner of Samsung said the company has only cut off retailers who removed its first branding signage outside the store. “Several of the retailers were leading partners of Samsung. Since Xiaomi has targeted them, Samsung is now renegotiating with them to woo back,” he said.