Amazon Closes Gap with Flipkart’s Standalone Sales in 2017

In this battle for supremacy in terms of market capitalization, revenue growth, and customer base expansion, Amazon is seen narrowing the gap between itself and its closest rival Flipkart. The two giants are clashing it on in the Indian e-commerce domain from past few years to establish their stronghold in a $33 billion-plus market.

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A recent report titled, ‘Online Retail Forecast (2017-2022) Asia Pacific’, by research base at Forrester has revealed that the global e-commerce giant Amazon is behind by a narrow margin of less than 1% in GMV market share for 2017 in comparison to Flipkart (in terms of Indian market).

The report has highlighted a positive development in the context of the efforts and planning done by Amazon to capture a large chunk of the market base and to establish itself as the undisputed leader on the Indian e-commerce market. At the close of 2017, Flipkart’s standalone market share was 31.9% a meagre 0.8% more than Amazon’s market share during the same period.

Advantage Amazon

Amazon since surpassing Flipkart for the first time in 2016 (in terms of metropolitan user preference) has gained strength as metropolitan Indian customer’s preferred online retail destination.  With an online selection base of over 160 million products and one of the largest fulfillment infrastructure built out in India Amazon has all those components in its kitty that are required to take its growth chart beyond Flipkart.

The report published by Forrester also acknowledged this fact and reported that Amazon has done well to capitalize on its presence in the Indian metropolitan customer base in the past two years. Around 80% of Amazon’s new customers are from Tier-2 cities and below geography areas as per the information given by Amazon India’s spokesperson.

Flipkart’s Stronghold

Smartphones and Fashion are two stronghold categories of Flipkart. Fashion exclusive website Myntra which is a part of Flipkart owned entities has generated good revenues and has become a leader in fashion-oriented e-commerce when it comes to the Indian market.

In the smartphone segment, Flipkart has done well to grow its market share of online shipments from 44% in 2016 to 51% at the close of 2017. Flipkart’s collaboration with brands like Redmi for the launch of their exclusive products on its e-commerce platform has also added strength to its edge over Amazon.

Amazon’s new target

Amazon is targeting grocery as a potential segment for enhancing its revenue generation in India. The sales of around $200 million in 2017 in this segment have made Amazon push aggressively for this segment. The Forrester’s report also weighed Grocery as a category to watch out for in 2018 with sale generation capacity of around 7% by 2022.

Amazon’s pantry segment is also a potential one for its growth and expansion in the Indian market. The pantry section with supermarket store like the arrangement of daily use products and items has allowed Amazon to step into domains that are still not explored by Flipkart.

A Contest to look for

With big-ticket investments and segment expansion, Amazon would like to press for its dominance in the Indian market. However, Flipkart’s planning and strategy to contain the rival and broaden the gap between itself and Amazon would be interesting to watch.

In this battle of supremacy among the two giants one thing which is sure is the customers’ delight, as both the campus would be extending best of their services and would also look for offering a diverse set of services to the consumer base. So, sit back and relax to see an exciting face off in Indian e-commerce market this year.