Amazon, Flipkart fight for smartphones market share; ecommerce industry headed towards duopoly?

Editor | Sep 15, 2020

Flipkart and Amazon are fighting for dominance in the smartphones category as it is cream of the crop as far as the Indian ecommerce industry is concerned. After Flipkart declared that they are the smartphone category leader, Amazon broke the sales record during the August Great Indian Sale. The American etailer also questioned the authenticity of the smartphone sales data of research firms, which concluded that Flipkart is the leader.

Need for new strategies to push smartphone sales

As per industry watchers, the online sales contribution to the overall smartphones market has remained stagnant at 33% for the past one year. Since, Amazon and Flipkart want to increase their market share, they are thinking of new ways to revive the sluggish sales.

Some of the new strategies that are going to be implemented by Flipkart are expanding the deliverable pincodes and serve customers residing in small towns. The Indian ecommerce leader is also going to offer day-and-a-half delivery service for smartphones, even during the busy festive season period.

On the other hand, Amazon is collaborating with telecom carriers to set up demo zones in the store to offer buyers a touch and feel experience. The marketplace has already partnered with Vodafone in Bangalore and plans to add more service providers. The strategy of offline kiosks would particularly work in rural areas and remote towns.

Ayyappan Rajagopal, Flipkart’s senior director of the smartphones category thinks that the online smartphones sales contribution can grow up to 40-50% in the next two years. He believes that the online market has more potential than the offline market because of the many benefits attached to it.

“Offline will never be able to solve issues around product exchange, assured buyback and consumer finance which we have been able to solve. And, brands see value in this differentiating factor, which is why premium brands like Apple, Google and Samsung launch their phones in online first and then launch it offline,” asserted Rajagopal.  

Duopoly of Amazon and Flipkart

Smartphones is just one of the many battles that Flipkart and Amazon are fighting with each other. And from the looks of it, both the ecommerce companies are the present leaders of the Indian ecommerce industry. Eventually one might get ahead of the other one, but other ecommerce companies don’t seem to stand a chance to break this duopoly.

Small and niche ecommerce players are either shutting shop (PepperTap) or consolidating with bigger entities (FreeCharge, FabFurnish). Experts believe that consolidation is the way to go forward, because it is hard to beat mammoths like Flipkart and Amazon on their own.

It is almost impossible to match the deep pockets of Amazon and Flipkart and hence in spite of receiving funds from investors, small players are struggling to survive. Therefore, the number of new ecommerce companies is also slowing diminishing.

However, there are people who believe that India has space for multiple ecommerce players. Shopclues’ co-founder Radhika Aggarwal is one of them. She said,

“We don’t believe that a single player can be everything to everyone… ShopClues is No. 1 in tier-3, -4 India which is Bharat.”

In the meanwhile, Snapdeal is gearing up for its new innings. And the 2017 festive season would determine if Kunal Bahl’s company can compete against the Bansals and Jeff Bezos.

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