On the onset of the New Year, Xiaomi CEO Lei Jun has penned a letter to all his employees highlighting the key milestones of 2016. He outlined all of the triumphs that the company collectively achieved in markets like China and India, and even announced a not-so-ambitious goal of achieving a revenue of CNY 100 billion (roughly Rs. 985 billion) in 2017.
The company that takes pride in its annual sales count has refrained from announcing any number this year, breaking tradition. Xiaomi, in early 2015, had announced an ambitious goal of 100 million smartphones, but managed to rake in only 70 million sales figure by the end of the year. This mismanaged goal setting prevented it from announcing any such prediction figure last year, nor announce any sales number this year. This could also be attributed to the slowing smartphone market overall.
Jun cautioned that the company needs to improve in some areas, and the need for introspection is at its peak. "In the first few years, we pushed ahead too fast. We created a miracle, but also drew on some long-term growth. So we have to slow down, further improve in some areas, and ensure sustainable growth for a long-term future," he wrote in his letter.
In India, Xiaomi achieved three big milestones. The company managed to sell 1.35 million smartphones in October, they passed $1 billion in annual revenue, and secured the third spot in the country's smartphone market share.
In China, Xiaomi looks to open 200 more Mi Home stores in 2017, and open a total of 1,000 stores over the next three years. Total revenue from Mi Ecosystem products, smart TVs and smart routers crossed CNY 15 billion in 2016, and the company has collectively sold over 50 million Mi Ecosystem IoT connected devices.
Jun also stressed on the company's need to focus on offline stores moving forward. Xiaomi made waves with its online strategy, but Jun notes that e-commerce now makes up just over 10 percent of overall retail in China, and the online smartphone market only makes up 20 percent of the overall smartphone market.
"Xiaomi has great ambitions, and we are not satisfied with just being an e-commerce smartphone brand, so we have to upgrade our retail model, and incorporate offline retail for a new retail strategy," he wrote. Jun also said that investments and research in Internet finance are ongoing and the company currently has over 300 people working on loans, insurance, securities, finance and payments, as well as securing the necessary licenses.
Xiaomi launched its first smartphone in August 2011, and has since then managed to become the fourth largest smartphone manufacturer in the world. Jun advises that the company's exponential growth needs to be rightly checked and evaluated for long term sustenance.