LIVE FROM MOBILE ASIA EXPO 2014: Lin Bin, founder and president of Xiaomi, said that the fast-growing vendor’s online device sales are likely to make it one of the top three e-commerce companies in China, stating that from the outset the founders were “determined that Xiaomi could be an internet company”.

Speaking in the Mobile World Live keynote on Wednesday, he said that by adopting a direct sales model, the company has been able to pass on benefits to consumers. “We can get rid of the channel and sales costs, so users can buy good quality products with low costs,” he said.

Xiaomi has become famous for the amount of buzz it has been able to generate around its new product launches. Almost 10 million customers were in the queue to buy 50,000 of its Mi2 smartphones, and the executive said that as part of a promotion to celebrate its four-year anniversary, it sold 1.3 million phones.

But being so internet-focused also presents challenges in terms of how Xiaomi interacts with customers, who can easily let the company know what they think.

“If your product has a bad reputation, users will blame you. We know that bad news travels much faster than good news,” Lin said.

Xiaomi has collected more than 150 million web postings from sites such as WeChat and Weibo since the launch of its first device, which he acknowledged is “a lot of feedback”.

As part of a focus on delivering a high quality user experience and performance, Xiaomi works with a number of top-tier suppliers, because “only by doing so can we guarantee the quality of the device”.

In line with its embracing of internet-driven openness, it also freely acknowledges which partners it is working with to deliver devices. “In this industry we are perhaps the first company to make transparent the names of our component suppliers,” he said.

But behind its e-commerce credentials, the company also has an impressive old-school logistics operation, including 1,700 call centre and 1,500 warehouse staff.

“Without good service, if you only sell phones, it’s not enough,” said Lin.

Watch a full replay of the keynote here.