Slow and steady Amazon moves ahead of SnapDeal, will it move ahead of FlipKart?
As per the industry estimates of last month, share of shipments for Flipkart fell down from 43% in March 2015 to 37% in March 2016 and for Snapdeal, it fell from 19% to 15%. And shockingly Amazon India’s share has amplified from 14% to 21-24% in this 1 year making it the second largest online player in India after Flipkart.
A senior Analyst at Forrester Research says, “If there is no new entry, it will be a two-horse race (between Flipkart and Amazon) by the end of the year”. Although Flipkart, Amazon and Snapdeal have not replied to the queries by ET, but estimated figures do show the current and forecasted online market situations. Apart from remarkably channelizing and improving the services and shopping experience with each passing day, Amazon is also expected to bring its successful Prime subscription programme in India. Seattle based Amazon is investing huge on its India unit since a year and planning to give it a remarkable momentum.
Investors and analysts predict that if FlipKart is not able to keep a strong grip on the market for another 6-12 months, then there are chances that Amazon might overtake Flipkart’s market share. Morgan Stanley estimates gross merchandise value (GMV) for FlipKart at 45%, SnapDeal at 26% and Amazon India at 12% of market. However, GMV does not factor discounts so cannot reflect the actual market shipment share. Earlier the main competitive product category between FlipKart and Amazon was electronics but after venturing with Myntra in 2014, FlipKart has taken success steps way further in fashion sector where gross margins can bloom up to 45-50%. Binny Bansal, the new CEO of FlipKart, is putting new strategies into play to build world class customer experience.
SnapDeal is trying to enter into and partner with other firms and services to grab its position back. Amazon India is now trying hard to acquire the first position by beating FliKkart and Flipkart is fine tuning its business model to keep its leading position intact. Time will tell us more on how these three musketeers will be ranked by the year end.