The mini was never designed to be anything resembling the hit the normal 12/Pro is. I work with Apple products a lot, and from what I've seen the mini was specifically designed to cater to those who were growing tired of the classic consumerist "bigger/more/shinier is better" ideology that's gripped the tech sector in the past decade.
The mini is designed to swoon those who were ultimately seeking to get as seamless a phone experience as possible, without frivolous and fancy features, to the point where they were looking for flip phones or Light phones or whatever as a remedy for truly not needing or wanting these larger phones and those features and benefits that are tailored to those who have Instagram or use AR or often watch video on phones.
The mini is designed to carve out it's own distinctly full fleshed, size-appropriate device category for those of us who hate redundancy and are true Apple ecosystem believers (why do I need a 6.something inch phone when I already either have an iPad mini or an iPad Pro? Unnecessary redundancy within a walled garden sucks). The recent SE was almost there, except it lacked forward-thinking and future-proofing features that are now essential (specifically OLED). So the SE is for the grandparents... But what about the 20/30-somethings who are exploring de-technifying (copyright pending) and simplifying their lives, but still wish to have the foundation of good, solid phone?
Basically, the iPhone 12 mini is designed to call back those who aren't wowed by the incredible new cameras or the massive screen or the glam of the 12 Pro Max or whatever. It's to call back those customers Apple was very much at risk of losing, so I don't think in the end it matters how well it sells. It's not meant to be that heavy hitter, but rather to fill a relatively niche market that the company had been accused of neglecting (much like how the Pro market was a few years ago).
Source: Me, as someone who has deleted social media, uses film cameras, has a bunch of Apple tech in multiple sizes, and who regularly used an aging 4S as an escape from a frankly oversized 11 Pro. I have the mini now and every single freaking second of use has been the best experience I've had with a phone and is everything I was looking for.