Amazon’s India Success Story

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Over the last several years, the Indian e-commerce market has seen a dramatic shift, with local players losing market share to large foreign companies.

As of May 2016, Amazon India owned over a third of the industry’s quality traffic, beating out local players such as Snapdeal and Flipkart. When their traffic is combined, these three e-commerce superpowers capture nearly 70% of the entire industry!

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Amazon didn’t always have this large of a market share in India and in May 2015, they were only responsible for 23% of the Indian e-commerce market. Since then, their market share has gone up by 13%, while Flipkart and Snapdeal have each lost precious market share.

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How did Amazon India do it?

Most of Amazon’s desktop visits came via direct traffic, and between May 2015 and May 2016, amazon.in‘s desktop traffic rose 18%. Furthermore, the site significantly ramped up paid search campaigns, which improved paid search traffic by 61% from May to May.

In the Indian online shopping industry, direct traffic was responsible for 36% of desktop traffic over the last year. Slightly behind direct is organic search traffic, which brought 30% of the industry’s desktop visits. Clearly, brand awareness and search are crucial to a successful marketing strategy.

To put this in perspective, in the US, 44% of desktop shopping traffic comes from direct, while organic seach is only responsible for a quarter of overall shopping traffic. Similarly, in the UK, direct traffic accounts for 40% of the industry, while in Russia it only accounts for 28%.

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In order to fully understand the online shopping world in India, it’s impossible to ignore mobile apps. As of June 2016, Flipkart remains the dominant app on Android phones in India, with over 1/3 of Android users having the app installed on their phone. This high figure for Flipkart installs is likely due to the fact that up until recently, mobile users were forced to download the app as opposed to visiting the website’s domain on mobile web. That all changed in the fall of 2015 when Flipkart released its mobile web friendly site, drastically altering their digital strategy.

After Flipkart, Amazon’s India app came in second, followed by Snapdeal and Myntra all of which reach over 10% of Indian Android phones. Furthermore, Flipkart owns Myntra, which recently purchased Jabong, giving Flipkart an even larger share of the E-commerce app market.

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In a similar fashion to websites, the app landscape has changed over time and we see yet again how Amazon was able to leapfrog some of their competitors and significantly change their app’s reach year-over-year.

Over the course of one year, Amazon’s mobile app in India was able to double its reach and, in the process, pass Snapdeal on Android app installs. Interestingly, this uptick in Amazon installs began in November 2015, the same month that Flipkart switched their mobile strategy to allow users to browse their website on mobile phones. Amazon was able to successfully use this opportunity to fuel its app’s growth.

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Looking to gain more insights into the online shopping habits of other countries? Check out our reports on theUS, Germany, France, and Russia.

About the Author –

Adi Sarig is an Enterprise Account Manager at SimilarWeb. She has an extensive experience in online marketing and is a passionate fan of technology, media and marketing.

Source: https://www.similarweb.com/blog/india-online-shopping#

We are the leaders in e-commerce in India – Amit Agarwal, India Head of Amazon

RADHIKA P NAIR,  9 JUNE 2016

No, Jeff Bezos is not coming to India to present a larger-than-life-size cheque to his India Head for the $3 billion he has promised to pump into Amazon India. So says Amit Agarwal, Vice President and India Country Manager, to whom Jeffpresented a $2 billion cheque amidst much fanfare when the latter visited India in 2014. On Tuesday, in the presence of Indian Prime Minister Narendra Modi, Jeff announced that the company will boost its India war chest by a further $3 billion.

Amit said in an interaction with YourStory that he will continue to focus on the three pillars on which the company’s India success story has been built. “Our focus is going to be the same – improving customer experience. Consumers care about selection options, low prices and fast, reliable delivery. Sellers care about transparent, fair and predictable platform to sell. On both fronts, things that customers care about are not going to change, even in the course of 20 years,” said Amit.

It is not surprising that Amit continues to focus on doing what Amazon has done in the past. It has worked out well for the company. Reports in April suggested that Amazon India has surged past Snapdeal to become the second largest online marketplace with a market share of over 21 percent. The same report claims that Flipkart’s market share fell to 37 percent, while Snapdeal is now at about 14 percent. However, Amit has a different claim. He said,

From our vantage point, we are already the leader…We have grown 250 percent year-on-year. In Q4 we sold more than the entire year last year. In Q1 of this year, we have grown by 150 percent year-on-yea, despite having a great growth rate last year.

He, however, declined to provide the transaction numbers.

Status of new initiatives

Amazon Now, the two-hour delivery service that the company launched for regular groceries, will be one of the major areas of focus. Amit said their Amazon Now operations, available only in Bengaluru, has grown three times in the past three months. The company intends to expand operations to other cities in the near future. Flipkart recently shut down its hyperlocal grocery operations. Over 10,000 small and medium businesses are using Amazon Business, the wholesale arm operational in Bengaluru.

On investments and acquisitions

Amit said the primarily organic strategy the company has followed has worked well for them. He, however, added, “We are always looking for visionary entrepreneurs and companies to delight customers and will align with our company’s core idea.” Amazon has invested in companies like hyperlocal services venture Housejoy and in online financial services firm BankBazaar.

 Mobile on top

Over 75 percent of traffic and over 50 percent of sales on Amazon is through mobile. Also, over 65 percent of orders are from non-tier-I cities. “The one thing about the Indian market that surprised me was just how sophisticated and discerning the Indian consumer-seller environment is at an early age of evolution of e-commerce in India. Sellers are new to online retailing and consumers were also new to online retailing, but the speed at which they’ve got used to the system is great and exciting. This (online retail) has become a national phenomenon,” he said.

Amazon vs Alibaba (and many others)

Amazon’s nemesis in China, Alibaba, has made many aggressive moves in India – investing in Snapdeal and Paytm. There are also many indications that the company will soon launch online retail operations in India. Alibaba is not the only big player that Amazon has to be worried about. The Tatas, Aditya Birla and reliance Industries – all major conglomerates – have also launched online retail operations in recent months. While Amit declined to comment on any of these competitors directly, he said,

Very early for e-commerce in India and for Amazon in India. It is a large market and there will be many winners. Our sole focus is to delight customers and we have a long term outlook. You should expect us to invest aggressively in the market.

The public announcement of the $3 billion investment is a definite shot in the arm for Amazon India. However, competition is only getting tougher and Amazon and Amit cannot afford any missteps as they battle for the e-commerce crown.

Source: https://yourstory.com/2016/06/amit-agarwal-amazon-india/

 

Amazon sets the pace for e-commerce in India

Flipkart and Snapdeal take a cue from Amazon even as they differ on who is ahead in the race

Nivedita Mookerji |  New Delhi  May 26, 2016 Last Updated at 21:10 IST

Seattle-based e-commerce giant Amazon should be happy that even before it turns three in India on June 5, the company has emerged a leader in this market. Before rivals can protest, we are not talking numbers yet. The American player has won the first round simply because it has successfully pushed competition to change the narrative and metrics of the online play.

Earlier this week, the almost nine-year-old poster boy of Indian ecommerce, Flipkart, announced in three separate interviews that customer satisfaction would be its mantra from now on. GMV or gross merchandise value of goods sold on the platform, till now the benchmark for success, will be kept aside, said Binny Bansal, who became CEO ofFlipkart in January. Not too long ago, Snapdeal CEO Kunal Bahl had the same to say about shedding the GMV goalpost.

In the process, both Flipkart and Snapdeal have endorsed what the American e-commerce major has always maintained and indirectly acknowledged Amazon’s heavyweight presence in this market.

Here’s how the customer has always been the central point for Amazon. When asked about the next round of investment coming into India and whether the figure would be higher than the $2 billion announced in 2014, the company’s India head, Amit Agarwal, had said in December 2015: “All I can say is that we will not be held back for investments…. We don’t manage to a number but to the customer’s expectation.” Also, GMV was never a benchmark that this company referred to, unlike its rivals.

The focus on customer flows from the top. In September 2014, Amazon founder Jeff Bezos had told this newspaper, ”I stay heads down, focused. I encourage these guys (the India team) to not pay attention to a bunch of noise, and rather stay focused on the customer experience, figure out how to get products to customers faster with more reliability, earn trust with customers. The rest will take care of itself.”

In fact, the Bansals of Flipkart have known the napkin sketch of flywheel (with customer at the centre) drawn by Bezos some 17 years ago only too well: the two IITians had worked at Amazon in the US before starting their own venture in 2007.

As for numbers, estimates show that Amazon’s growth in India was 250 per cent in 2015 compared to the previous year. This year, the growth has been around 150 per cent. The number of active sellers on the platform is pegged at 85,000 and industry reports have shown that its website is top of the list in e-commerce. The company does not offer separate customer data for different geographies, but it has a total global user base of 300 million plus.

Picking and choosing
Comparisons with Flipkart and Snapdeal are tough. But in a cat and mouse chase, both Amazon and Flipkart or their investors have been dishing out data from time to time, citing analytics firms. In December, two sets of data came out. One was from Bezos in an email to customers. “Just two and a half years from our launch, Amazon.in has become the most visited e-commerce site in India,” Bezos wrote. He cited data analytics firm ComScore to say Amazon was leading with more than 30 million monthly unique visitors as of October 2015. Flipkart was at 27 million while Snapdeal was at 20 million. These numbers reflected unique visitors to e-commerce sites through desktop or laptop, rather than through mobile apps.

In the same month, Naspers, a South African Internet company, said Flipkart, along with Myntra, had over 50 million monthly active users on its smartphone app, three times larger than those on Snapdeal and Amazon during the September 2015 quarter. Naspers owns 17.4 per cent in Flipkart.

If number of visitors is what Amazon and Flipkart cite to claim leadership position, Snapdeal is peddling transaction numbers for the top slot. Snapdeal co-founder and COO Rohit Bansal said in February that the company has 1 million transacting users on the platform (Snapdeal, Freecharge and Shopo combined), and the number is higher than Amazon and Flipkart put together. Snapdeal aims to grow the transacting user number to 20 million by 2020.

There have been shipment comparisons too. Based on interaction with an unnamed logistic firm, a recent media report said that Amazon was the only e-commerce firm to have grown in shipment share from a year ago. While Amazon’s shipment share is said to have grown to 21-24 per cent from 19 per cent earlier, Flipkart’s share dropped from 43 per cent to 37 per cent and Snapdeal’s from 19 per cent to 14-15 per cent. These numbers could not be verified independently.

Number of sellers is another way of comparing the strength of a player. Against Amazon’s active 85,000, Flipkart has more than 100,000 and Snapdeal around 250,000.

The measure of success
Of late, companies have even started measuring the average delivery time as a benchmark in e-commerce. A recent study by PwC put Snapdeal ahead of Amazon and Flipkart in that measure.

Till recently, when the industry referred to GMV as the only solid currency, Flipkart was an undisputed leader at around $10 billion of total sales, followed by Snapdeal at $4 billion and Amazon at $2 billion as of 2015 estimates. One of the analysts that this newspaper spoke to projected the 2017 GMV at $12 billion for Flipkart, $9 billion for Snapdeal and $6.3 billion for Amazon. But according to him, the math could change as it was possible for Amazon to cross Snapdeal’s GMV while moving closer to Flipkart, depending on how the three played out the GMV-versus-profitability game.

A report published by Bank of America-Merrill Lynch in May 2015 placed Flipkart on top with 43 per cent market share, followed by Snapdeal at 30 per cent and Amazon at 18 per cent.

One year later, things have moved on. As reported by this paper, in the next 12 to 18 months, Amazon has the potential to be at the top of the pack, executives at three prominent international analyst firms say. If Flipkart and Snapdeal focus more on getting profits, shifting their attention from GMV, Amazon could race ahead faster, they said.

Stumbling blocks
But there are challenges on the way. The riders that came with the recent guidelines allowing 100 per cent FDI in online marketplace companies are among the hurdles. While liberalising e-commerce, the Department of Industrial Policy & Promotion has introduced conditions to ensure that platform owners do not turn sellers. Thus, sales cannot exceed 25 per cent for any vendor, marketplace players or their group companies cannot sell, guarantee and warranty must be the sole responsibilities of the sellers, and platform owners cannot influence pricing of products so that there’s a level playing field.

In fact, Amazon highlighted the regulatory risks in its India business, citing the latest e-commerce guidelines, in its filings to the US Securities & Exchange Commission.

Apart from the risk of sellers not being able to offer products at low prices on Amazon, as it may be interpreted as ”influencing pricing”, its worry is also Cloudtail, the most prominent vendor on the platform. Cloudtail, a joint venture of Amazon with Catamaran Ventures, promoted by Infosys founder NR Narayana Murthy, must reduce its sale to adhere with the latest Indian policy.

Even so, analysts believe that Amazon stands a better chance than the rest to be a long-term leader in e-commerce in India, primarily because of its war-chest. Amazon is a $100-billion conglomerate and it does have an open cheque book for India.

Source: http://www.business-standard.com/article/companies/amazon-sets-the-pace-for-e-commerce-in-india-116052601474_1.html

Online shopping sees 117% growth

NEW DELHI: As consumers went on a buying spree during the festive season of Diwali and Eid, they have not even spared the online shopping sites, which reported a whopping 117 per cent increase in sales.According to data release by Internet and Mobile Association of India (IAMAI) online sales during this festive stood at Rs 115 crore as against just Rs 53 crore last year. IAMAI said online sales registered 135 per cent increase in transaction and clocked over 8,10,000 transactions in three weeks as compared to 3,45,000 in 2004-05 season.”With e-commerce revenues to cross Rs 1,180 crore for 2005-06 and a growing internet user base currently at more than 32 million its been a sparkling Diwali and Eid in 2005-06 as e-commerce sales crossed to a whopping Rs 115 crore in three weeks period,” IAMAI president Preeti Desai said in a statement.More than 4,15,000 Indians made an average purchase of Rs 1,420, which ranged between Rs 1 to as high as Rs 1,40,000, using the online services this Diwali, it said.During the entire festive season, the most active online shopping days were from October 28 to November 3. IAMAI said consumer preference for products remained more or less similar as that of last year, with consumer electronics, such as digital cameras, mobile phones, DVD players and microwaves topping the shopping list in major cities, followed by gifts, apparel, jewellery and accessories. There were more than 3,60,000 products available in catalogue for the online consumers to shop, it said.

Source: http://articles.economictimes.indiatimes.com/2005-11-04/news/27481115_1_online-shopping-online-consumers-online-sales

How online shopping is changing rural India

I stay in rural Maharashtra. We have reached a stage in life where we hardly shop but sometimes need specialty items like books, computer peripherals, herbal teas and the like.

These items are not available in our rural town of Phaltan where we live and so we do online shopping. In the last year or so we have discovered the power of such shopping.

In the recent past, we would go once a month to Pune (110 km away) to buy a few things. Now because of online shopping, such trips have drastically reduced – and for good reason. It takes about three hours to reach Pune, driving over pot-holed roads, which produces back pain. Besides, the traffic jams and pollution in or near Pune add to the discomfort.

Also going to Pune for a few items was quite a chore and waste of energy and time. Now online shopping allows us the luxury of getting all sorts of items at home.

Such online shopping is being discovered in all rural towns and areas around the country. However, for such e-commerce to take place, it is necessary to have a good internet connection, ability to sift through the various items offered and zeroing on selection of quality material. All this is possible by googling the items and comparing their prices and specifications.

I find that the rural population is learning this search-and-pick at amazing speed- which is reflected in the increase of sales in rural areas via online shopping. They also order items seen on TV ads and those passed by word of mouth.

With mobile penetration in rural India, this shopping is also facilitated by various smartphone apps so that desktop PCs are not required.

Nevertheless, this online shopping is fuelling consumerism in rural areas and is the engine which is helping it to urbanize. It is happening because it produces a win-win situation. For example, one can get quality goods at substantial savings as they are usually much cheaper than what one would pay in a shop in Pune or other big cities.

Besides, most of the time the goods are shipped free and cash-on-delivery basis. Also, the time and energy used in actual shopping and going to the big city are saved.

This is the reason why e-commerce has spread so rapidly all over the world and rural India is only now getting the benefits of this revolution.

The foray of the online companies in rural India is also fuelling the job market- it is providing employment to a large number of rural youth as delivery boys. Besides, it has given a shot in the arm to loss-making India Post since their large network of postmen is being used by e-commerce companies to penetrate rural areas.

However, such shipments are energy intensive. For a small item the packing is almost three-to-four times its size. This is waste of material, and adds to the weight of shipment and to the transport energy cost.

Secondly, quite a number of times, the item which is manufactured locally is shipped to big cities and then again to the final destination. For example, we ordered a packet of mango pickle (of a brand that is not available in Phaltan) which is manufactured about 45 km from our rural town. This packet was shipped to Bangalore from where it came to us.

This is a real wastage of energy in transport but the shipping company may be finding it cheaper to do so for whatever reasons. Yet with all this travelling around we got this packet at nearly half the price of what we would have paid in a Pune shop.

So, how do companies like Amazon, Flipkart, Snapdeal and others who have big online presence in India still make money on such transactions? Data from their financials reveals that presently all of them are losing money – primarily because it is the start of e-commerce boom in India.

However, they feel that there is a great future in online shopping and with time, their profits will increase. Thus only those companies with deep pockets will survive since they alone have the staying power to penetrate the rural markets.

By Anil K. Rajvanshi, he is director at the Nimbkar Agricultural Research Institute (NARI), Maharashtra.

Source: http://articles.economictimes.indiatimes.com/2016-06-23/news/73969583_1_online-shopping-india-post-rural-india

I help you launch & grow your online business

Hi friends,

I am pleased to inform you that I am now Amazon Trained e-Commerce Specialist. ATES program is an Amazon Trained E-commerce Specialist Program aimed at helping sellers get started and grow their business on Amazon.in.

Who am I:

  • Is an Amazon trained professional who can help you launch your store on Amazon.in
  • Help you manage your Amazon store; available on flexible timings
  • Can assist you and save your time & effort
  • Can help with emails,order management & reports

How can I help you get launched on Online

  • I can help you register as a seller
  • I can help you set up your account on the online portal
  • I can help you list your products
  • I can help you go live on the website

Services Offered

  • I can help you with updating prices& listings, create promotion that would help you save time and sell product at the price that is competitive
  • I can help you manage customer e-mails that would enable you to attend customer query on time to improve customer Experience.
  • Help you with handling reports,that would give more insights on inventory, payments,sales & orders.
  • I can track & manage orders, returns and help improve on time product delivery, refunds to improve your seller ratings.

I am providing some of the points why you need us and what will be the potential growth involve.

  1. In 2001, there were about seven million Internet users in India. That number could cross 550 million in 2018 in the best case scenario, making it the second largest online population in the world.
  2. India is the third country in the world to have over five internet companies valued at over US$ 1 billion
  3. In 2013, the Internet contributed USD 60 billion or 2.7 per cent of India’s GDP–larger than the contribution of healthcare (2.5 per cent) and military (2.5 per cent), but less than agriculture (14 per cent).
  4. By 2020, the Internet is estimated to grow over 4 percent of India’s GDP. E-commerce will cross USD 17 billion in 2018 and eight million SMEs (out of 13 million SMEs); 200 million individuals will transact online.

According to a study conducted by the Internet and Mobile Association of India, the e-commerce sector is estimated to reach Rs.211,005 crore by December 2016.

Source: https://en.wikipedia.org/wiki/E-commerce_in_India

Limitations of offline retail

  • Reach
  • Cost of Operation
  • Product Display Space
  • Inventory Management
  • Payment Option

Why Go Online

  • Increase Reach
  • Reduced Cost of Operation
  • Better display of Products
  • Better Inventory Management

Key Benefits

  • Open a New Sales Channel and Reach Nationwide Customers
  • No Product Listing Fees
  • No Upfront Costs of Creating a Website or Setting up a Physical Store
  • Convenient, Trusted Shopping Experience for Customers
  • Grow your Business with Amazon’s World-Class Fulfillment
  • FBA orders are eligible for FREE Shipping, COD (Cash on Delivery), Guaranteed 1-Day Delivery, 2-Day Delivery & other benefits.
  • Secure Payments -Security and Fraud Protection for you and your Customers

E-commerce firms to invest up to $8 billion in infra, logistics

NEW DELHI: E-commerce companies are expected to invest about USD 6-8 billion in logistics, infrastructure and warehousing in the next few years on the back of growing popularity of online shopping in India , says a study.

As the e-commerce gathers momentum and moves to tier-II and tier-III cities , there will be increasing demand for expanding air cargo connectivity to smaller towns, an Assocham-PwC study said today.

The sector is growing at a compounded annual growth rate of about 35-40 per cent and it is expected to cross the USD 100 billion mark in five years, it added.

“With the growing popularity of online shopping which is expected to catapult the e-commerce market to USD 80 billion by 2020 in India, the online companies are expected to invest close to USD 6-8 billion in logistics, infrastructure and warehousing in the next few years,” it said.

Further, it said only a few airports are equipped to handle large volumes of express delivery parcels, and as the sector gathers momentum, there will be increasing demand of expanding air cargo connectivity to smaller towns.

Source: http://articles.economictimes.indiatimes.com/2016-06-29/news/74095273_1_e-commerce-firms-e-commerce-market-e-commerce-companies