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Xiaomi CEO plans on building more stores by 2020
Xiaomi is thinking of expanding not only online but by building physical stores where customers can try out the wide array of products they have.
Even before till now, Xiaomi have been a popular brand for the most part, with their online presence. You can’t blame them, they sell most of their new smartphones, smartbands, media boxes and drones online. They have good reviews on their past models and still getting more positive feedback for their Mi Band 2 and Mi 5s Plus.
Going online not only reduce the cost of the product because you don’t have to spend much on an actual store, it also reduce exposure for the brand to the public.
However, that’s all going to change in the next few years. Xiaomi has revealed that it plans to open 1,000 honest-to-goodness retail stores by 2020. It’s main goal: to make customers “touch and test” Xiaomi’s latest technology. According to CEO Lei Jun, this will enable Xiaomi to reach more people around China.
A spokesperson tells Tech in Asia that the retail plan is an acknowledgement that Xiaomi has “become a household name” in China, and that you’ll see its presence grow relatively quickly. The firm is converting its existing Mi Home outlets into full-on stores, and expects 60 Mi Home locations to be up and running by the end of 2016.
This could be a very costly move for Xiaomi but this is a high risk, high reward situation. The company has been enjoying a very small profit margin on hardware. They are a well-established company but smartphone sales for this year lowered this year. Part of this decline in numbers might be fierce competitions like Huawei who have 11,000 stores across China.
The benefits of having physical stores are tremendous. It can convince impulse buyers to buy products for sale.
Xiaomi might actually benefit from realizing this plan. They have the same place as Apple in the 2000s where opening more stores increased availability of their products and made the company looked good for public. Xiaomi might get the same results.