The company has channeled a lot of that money into improving the shopping experience for customers in terms of delivery and after sales service, say investors and analysts. Amazon is also expected to introduce its successful Prime subscription programme in India.
Amazon has dislodged Snapdeal to become India's second-largest online marketplace by shipments last month, industry estimates show, according to ETRetail.com. It also became the only major player to increase share from a year ago.
Market leader Flipkart's share of shipments fell to 37 per cent in March from 43 per cent in the same month in 2015, and#
In terms of gross merchandise value, though, Morgan Stanley in a February report estimated Flipkart's market share at 45 per cent, Snapdeal's at 26 per cent, and Amazon India's at 12 per cent. The GMV metric reflects the total value of all the goods sold on a platform but does not factor in discounts or reflect the actual commissions digital marketplaces earn on those sales.
The battle between Flipkart and Amazon has primarily been in electronics, including smartphones, but the action is likely to shift to fashion where the former has made significant headway with Myntra that it acquired in 2014. Electronics accounts for a large portion of shipments but fetch commissions of 2-7 per cent whereas gross margins in fashion can top 45-50 per cent, according to Morgan Stanley.
"We have clear leadership of the online market in India with over 60 per cent market share in three of the largest segments smartphones, fashion and electronics," said a Flipkart spokeswoman. "Our focus will be to consolidate this leadership position by continuing to build world-class customer experience, innovate retail in India and build a technology powerhouse out of India." (SH)
Fibre2Fashion News Desk – India
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