Commenting on Software Technology Trends & Market Dynamics

Jnan Dash

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The battle for India’s e-commerce market

Many experts predict that India will become a battleground for e-commerce by the second half of this year. According to a 7ParkData study, the share of monthly mobile e-commerce in March, 2017 looked as follows:

  • Flipkart – 30.7%, Amazon – 30.3%, Snapdeal – 10.8%, Others – 28.2%

Amazon launched its own e-commerce site in India in 2013, and is already fighting for the top spot against local player FlipKart. The Wall Street Journal in an article today said, “Walmart is nearing a deal to acquire a majority stake in India’s leading online retailer, a bold move that would open another front in its escalating war with Amazon. The Indian company, Flipkart, is a start-up that sells everything from clothing to smartphones in the country’s blossoming e-commerce market…Two of the people said that the deal would value Flipkart at about $20 billion and that Walmart was looking to acquire a stake of at least 60 percent. The deal would be an aggressive and, some analysts say, risky foray by Walmart into one of the world’s last great open markets for online retailing”. Softbank of Japan has invested in both FlipKart and Snapdeal.

India may be the first neutral territory where Amazon and Alibaba go head-to-head, as Alibaba’s Paytm Mall seems to be gaining traction quickly in the country. Paytm is an online payment application, much like Apple Pay. Paytm Mall, which launched earlier this year, reportedly garnered 15-20% of all e-commerce sales during the festive season (September 20 to mid-October of 2017). Currently, its value proposition — product quality, availability, and pricing — is nearly on par with Amazon’s and FlipKart’s, but its brand recognition is still low in the country. However, with Alibaba’s backing, it could easily invest heavily in marketing initiatives. And, given how quickly Paytm has already progressed, it will likely gain enough market share to threaten Amazon and Flipkart this year.

Amazon is not sitting idle and is aggressively planning its growth in the India market. It dominates the US e-commerce market with a 44% share in 2017. In India, it just added 5 more fulfillment centers (total of 67 across 13 states, several ones dedicated for grocery or large appliances). It has also introduced a new mobile web browser for Android, simply called “Internet”. It’s said to be “extra small,” taking up a minimal amount of smartphone memory, and also consumes less data when in use than other browsers — features Amazon believes people will find enticing, as it offers the equivalent of additional internet access at no additional cost. It is also building its India-first software experience for its Echo smart players.

It will be quite interesting to see all major players fighting out to capture the huge Indian market as e-commerce gets more mainstream over next few years.

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More Stories By Jnan Dash

Jnan Dash is Senior Advisor at EZShield Inc., Advisor at ScaleDB and Board Member at Compassites Software Solutions. He has lived in Silicon Valley since 1979. Formerly he was the Chief Strategy Officer (Consulting) at Curl Inc., before which he spent ten years at Oracle Corporation and was the Group Vice President, Systems Architecture and Technology till 2002. He was responsible for setting Oracle's core database and application server product directions and interacted with customers worldwide in translating future needs to product plans. Before that he spent 16 years at IBM. He blogs at http://jnandash.ulitzer.com.