Even as its home-grown rival Flipkart faces lowered valuations by some of its key investors like Morgan Stanley and T Rowe Price, Amazon has turned its focus on India more aggressively than earlier.
Here are 5 things Amazon India & Jeff Bezos are planning in India to take on Flipkart and Snapdeal:
1) $3 billion investment in India: Clearly signalling that outside of the US, India is the market which would drive its growth, the world’s largest online retailer Amazon has committed another $3 billion investment into its operations in the country, thus taking its committed investment to over $5 billion.
2) Identifying India as the fastest growing region for its business: This comes at a time when its competitors have been struggling to raise fresh funds in the country. This also comes after Amazon’s foray into China did not meet with the desired results.
3) Help start-ups in India and accelerate the country’s role as a hub for innovation and digital entrepreneurship
4) Open a web services cloud region in India this year: Bezos said he will open a web services cloud region and the country would soon become home to the company’s largest software engineering and development centre outside of the US, located in Hyderabad.
5) Amazon’s e-commerce operations India head Amit Agarwal is focused on meeting customer expectations by providing a wide assortment of goods at consistently low prices and reliable, quick service.
The $26-billion domestic e-commerce industry has seen a change in fortunes with Amazon, which launched its India operations three years ago, topping with 26 million unique visitors according to comScore, compared with Flipkart’s 21 million as of March 2016.
Anil Kumar, CEO of consulting firm RedSeer Consulting, told FE, “Except Amazon, all the key players have reduced their marketing budgets and are seeing a downward trend in market share. Amazon has realised that this is a good time for them to invest and they are using this opportunity to gain maximum (market) share.” According to a Morgan Stanley report, based on GMV figures for 2015, Flipkart had 45% market share, followed by Snapdeal at 26% and Amazon at 12%.
(With inputs from FE Bureau)