Flipkart, Amazon to adopt new strategies in 2018

BENGALURU: India’s Flipkart and America’s Amazon will adopt vastly divergent strategies in the New Year after years of matching steps in the battle to dominate one of the world’s most dynamic ecommerce markets, say analysts who also expect Paytm Mall, which is backed by China’s Alibaba, to open a third front.
Flipkart — the country’s largest online retailer — will woo more customers in smaller cities and towns with its own brand of consumer products.
Amazon, on the other hand, will look to deepen the range of offerings for its premium customers as both companies look to entrench their positions and also open new markets.
“For the first time, we may see the market leaders following two different routes,” wrote Rajiv Sharma, media and Internet analyst at HSBC Securities and Capital Markets (India).
“It may be no longer about gross merchandise value but more about basics like online shoppers, repeat purchase and growth in new categories and fall in mobile,” he said in the report, titled ‘India Internet: On the way to India Ecommerce 2.0”.
Flipkart did not reply to email queries from ETon the company’s strategy for 2018.
A representative for Amazon India said, “We aim to be the ‘everything’ store, where customers can find any and all products that they are looking for.”
Fierce Competition for Top Slot
The two companies, so far, have competed fiercely for leadership in the Indian online retail market — estimated to be worth $17-20 billion — with deep discounts, the most exclusive deals on smartphones and a wide array of fashion products particularly during the high-profile festive season sales.
This strategy, say analysts, will change as the industry grows at about 35% in the next five years, and customers look to buy more than just phones and fashion items online.
RedSeer Consulting estimates the mobile and fashion categories to account for about 68% of overall online sales in 2018, down from 72% in 2016. Meanwhile, more buyers are emerging from smaller cities and towns, and for newer categories like groceries and for budget phones.