After Xiaomi CEO Lei Jun decided to embark on his "second entrepreneurial venture," Xiaomi's operating model has significantly changed. Not only has the company de-emphasized annual sales figures, but it has also shifted its sales model for new products. Once officially announced, new products are immediately released to the market. While maintaining online sales, Xiaomi will also reach consumers through partner channels. Therefore, Xiaomi's future market development strategy envisions expanding to 1000 brick-and-mortar outlets within the next three years, strengthening its offline channels for direct communication with consumers.
Lei Jun explained that Xiaomi will launch a new retail model starting this year, and it is expected to open 200 experience stores this year to allow more consumers to directly experience Xiaomi's mobile phones and related products. It also plans to expand 1000 physical channels in the next three years, and hopes to open up more overseas markets through a new market strategy.
Although Xiaomi has historically focused on online sales, using this to reduce product sales costs, manage inventory pressures, and ultimately lower product prices to attract a wider consumer market, this sales model proves disadvantageous in markets heavily reliant on retail channels. This is why Xiaomi has historically failed to achieve sales in lower-tier cities, remote regions, and emerging markets. This is particularly true for markets like the United States, where relying solely on online sales will likely not lead to significant sales growth, as retail channels and telecom service bundles remain the dominant sales model.
Even though more and more people are buying mobile phones through online services, the sales volume is still not large compared to traditional retail channels and telecom operators. This is why Xiaomi plans to expand its physical channels.
In Taiwan, Xiaomi has confirmed that it will open a second Mi Home outside of Taipei. Currently, it has chosen to present it in the form of a store-within-a-store on Caoya Road, Taroko District, Kaohsiung, allowing consumers to directly feel and experience Xiaomi products. In addition, it has also added 5 fast repair points in cooperation with Synnex International in 6 major metropolitan areas such as Taipei and Kaohsiung, so that consumers can get faster repair services without having to transfer to other places for repairs, thereby strengthening product after-sales service.
