Get a demo Do I subscribe? News sign-up
Print

Indian e-commerce consolidation looms

News, 05 July 2016
Topics

NEW DELHI: Flipkart emerged as India's preferred online retail platform in recent research, but the future of the e-commerce sector lies with the likes of Amazon and Alibaba according to a leading industry figure.

A study by Red Seer Consulting – The Indian e-tailing Leadership Index – surveyed over 3,000 customers and 6,000 deliveries across the country, looking at experiences in key areas including value for money, customer support, ease of return, refund and reverse pick up speed.

It ranked Flipkart at number one overall followed by Amazon, Snapdeal, Paytm and Shopclues.

But that may all change over the course of the next year, suggested Vijay Shekhar Sharma, CEO of digital wallet and online retailer Paytm.

"The ecommerce business and market is reaching maturity of players," he told the Economic Times. "The next 6-9 months, it will be decided who the key contenders of the business are.

"Logically, to fight Amazon, you need the might of a strategic player – that is why it makes a lot of sense for people to align with Alibaba versus a lot of others," he added.

Both Amazon and Alibaba are pouring money into India, the former announcing a $3bn investment recently on top of an earlier $2bn, while the latter already has a 40% share in Paytm and a 4% share of Snapdeal.

The Red Seer report gave Flipkart a 35-37% share of the e-commerce market in 2015, with Snapdeal in second place on 21-23% and Amazon in third on 17-19%; but it added that Amazon had moved into second place in the first quarter of 2016.

"Amazon grew aggressively with growth driven by both fashion and electronics categories and continued spending on discounting and advertising," the study said.

It valued the valued the overall e-tailing market at between $80bn and $100bn by 2020, as the market is driven by a compound annual growth rate of 45-50% over the next few years.

Data sourced from Economic Times, Business World; additional content by Warc staff

Topics