Slow and steady loses the race: eBay revenues fail to impress

Back in 2004, eBay India was the first to enter the online retail space in India. At that time, shopping online was as strange to consumers as some unknown ritual. Thus, eBay definitely had a head start in the industry as it did not really have any competitors. But they say, everything has its own right time. The following decade after that year saw the rise of several home-grown ecommerce websites in India, which poured in all their resources to educate the Indian shoppers about ecommerce and launch aggressive marketing campaigns.

Leaving no stone unturned to give customers the best possible online shopping experience, these websites seem to have trumped over eBay India as well. eBay India posted revenues of Rs 107 crore calculated on commission earned from sellers along with advertising revenues for fiscal 2013-14, according to its annual filing to the Registrar of Companies. Interestingly, Flipkart reported income of Rs 179 crore.

Throwback to a year earlier, eBay’s revenue was Rs 81 crore while Flipkart trailed  at just Rs 15.4 crore.

What has led this growth?

Experts believe it is the aggressive marketing by these ecommerce companies that has led them to strike gold. This is encouraging news in the face of doubts raised about the profitability of ecommerce sites in India. This is definitely a good sign that proves that heavy expenditure in customer acquisition and retention is an asset for long-term growth of the ecommerce industry.

Flipkart has also managed to kill two birds with one stone, as it was earlier reported that they do not want to focus on ‘profitability’ at the moment but only want to invest in growing their services. The revenue figures however show that they are not lagging behind in financial progress as well.

Ecommerce companies in India have grown so rapidly and aggressively that all we can say is, ‘slow and steady’ is not their mantra to ecommerce success.