Earlier this month, we came across a survey which said that Flipkart has been chosen as the most preferred e-commerce platform over Amazon India, Snapdeal, Paytm and Shopclues. Now, a new Bank of America Merrill Lynch report states that Amazon is improving its grip in India and the American e-commerce giant could be the second biggest player after Flipkart in the online retail market by 2019. Talking about the e-commerce s Indian market, the report said that India could also become Amazon’s second largest market after the US. The company has plans to invest $5 billion in its India business. While revenues are relatively small to Amazon’s global scale, Amazon India could generate $81 billion in GMV and $2.2 billion in operating profit by 2025. Also Read - Flipkart Big Saving Days 2021 sale: Top deals on mobile phones to look atAlso Read - Flipkart Big Saving Days sale begins for Plus members: Check out top deals on smartphones
“For last couple of months, Amazon India gross sales are higher than that of Flipkart standalone (excluding Myntra),” it added. “We now expect Amazon’s GMV (gross merchandise value) market share to improve to 37 percent by 2019 from 21 percent in 2015 and expect it to be close No 2 behind Flipkart,” the report said. Most of Amazon’s gains have come at the expense of Snapdeal and other sellers, not Flipkart, according to the report. Flipkart still remains the market leader in India and “even in terms of customer satisfaction, reports indicate that it remains the leader, ahead of both Amazon and Snapdeal“, according to the report.
Amazon has been able to benefit from global brand and establishing reliability of service among consumers, concentrating on offering superior customer service and wider assortment of products. Amazon has also tied up with Vakrangee, a franchisee with strong presence in rural/underdeveloped areas to fortify its rural presence at relatively lower investments. As of June this year, Amazon is already active in more than 1,000 outlets, with plans to increase to 75,000 outlets by 2020, the report noted. ALSO READ: Flipkart most preferred e-commerce platform: Survey
Alibaba is looking to enter into the Indian e-commerce market by early next year as a more direct entry, despite it having investments in PayTM/Snapdeal. “We note that similar to Amazon, Alibaba likely considers India as the next big market apart from its home market and is looking to gain traction there,” the report said. ALSO READ: Flipkart, Snapdeal selling Narendra Modi toy dolls that can instill a love for wildlife