Last week IOS shared Morgan Stanley’s report that revealed how the combined GMV of Indian ecommerce industry’s trinity – Amazon, Flipkart and Snapdeal was more than the top ten offline retailers in 2015.
While the ecommerce leaders did gain more than offline firms, it also lost online market share in 2015 compared to last year due to small niche players, as per the Morgan Stanley report.
Popularity of category-focused niche etailers such as online lingerie store Zivame, furniture portals Urban Ladder, Pepperfry and jewellery platforms Carat Lane, Velvet Case, Blue Stone grew tremendously in 2015. Investors including Ratan Tata poured in millions of funds to back such players and helped them to expand aggressively.
On the other hand online marketplaces tried hard to keep excessive discounts in check last year. This is why it seems niche etailers managed to grab a tiny portion of the market share from the big players, as buyers wandered away in search of other options.
As per the Morgan Stanley report:
Amazon India however refuses to accept the findings of the report. The official representative claimed, “The report does not reflect what we are actually seeing on the ground as we are growing significantly faster than the growth rates of the ecommerce industry in India and other mentions in the report. We have previously announced that Diwali 2015 was four times bigger than Diwali 2014 and we sold more in Q4 2015 than we did in the entire previous year (2014).”
Small players gaining market share indicate that there’s a lot of room for others in the ecommerce industry besides the top three players.
Calling India a far more democratic market than China, Nitin Chhabra, CEO of ecommerce consultancy firm Ace Turtle said, “Our market will not be like China where you have a few big players like Alibaba, Tmall and JD.com. India will go more the Europe way with many vertical players. Verticals players such as Urban Ladder and Zivame have started nibbling at market shares. India will be far more democratic than China where it is just few big players.”
Railway Minister Suresh Prabhu while presenting the Railway Budget 2016-17 yesterday said, “The IRCTC website also offers opportunities for exploiting e-commerce activities on account of the large number of hits it receives.”
The underlying message of this one sentence appears to be ‘Ecommerce leaders and other players, come and explore IRCTC’s huge potential and increase your revenue.’
And why not? With 390 million registered users, 250 million active users and 4.15 lakh average bookings per day, the portal is one of the most visited online sites in India.
“Very few realise IRCTC is already the largest e-commerce company in India (by size). With payment gateway and physical (railway) network already in place, the potential is huge. Start offering products, and allow shopping while in train by getting good (internet) connection, and install touchscreen-based kiosks in trains,” rightly pointed out Sreedhar Prasad, partner at KPMG.
While Amazon India has already collaborated with Indian Railways, others like Snapdeal, Paytm, Flipkart, and Shopclues should consider tying-up too to increase their market share.
Editor team is specialized in introducing the marketplace content targeting the Indian online sellers. They plan and coordinate to bring the appealing content for the small businesses on how to partner with the e-commerce sites like Amazon and Flipkart and strategies for improving their online business.
Leave a Comment
