The tale of Indian E-commerce Giants – Who is ahead
India is moving towards a new digital revolution. With the advancement of technology comes the section of comfortable living at the doorstep. People prefer something that is convenient and more promising. With the evolution of e-commerce, people started to transact online for the good and service with no need for the extra time that is to be spent in going out to local stores.
Ecommerce industry till now has passed three stages. The first stages are somewhere between the mid-’90s to 2005, the second phase till 2015 and we are presently in the 3rd phase. The remarkable boost in the third phase is the promotion digital world, the promotion of online transaction or digital transaction, which made the eCommerce industry boom in the market.
In the past, The eCommerce industry has to suffer from the problem of unavailability of payment methods, unviable warehousing options and less demand in the market. Till 2005 all these problems were making the industry suffer. But later when the offline merchants have come to a realization that that offline store’s warehousing, offices and stores are an asset to the online commerce, that is when the second phase of e-commerce began. A phase when the eCommerce industry started to upgrade the assets for better management of goods.
The era we are in the new era of Digital Revolution. A new India, where at every step online transactions are being promoted, digital services are promoted, and slowly we are entering the digital age. Where everything will happen in just a click on our mobile phone. This is where eCommerce is leading in the third phase. In this phase due to the increased number of people preferring online commerce and more people coming online daily, there is a considerable increase in the online transactions. This also leads to the emergence of new players in the market.
Now when there is a lot of customers, that is when new players will enter to capture the increasing customer segment. But the new players have to compete with the existing giants and this is where the real challenge comes.
What comes to your mind first when I first immediately tell the word eCommerce to you. Did you visualize Amazon, Flipkart or something else? Did you think of something more new and competitive in the market? I bet maximum people will think about the existing and established players like Amazon, Flipkart, or some other one. This is where the problem exists for new Competitors. They wanted to make the people know their service will be better than the existing ones.
Though there is a huge competition in the market the new players have sustained and tried to capture the customer segment. Some of the companies have specialized in targeting a particular segment of customers or a particular domain of products. For example, there are eCommerce sites that specifically provide the latest gadgets at best prices, and there are sites that target Latest Fashion and there are sites which specifically provide fresh grocery and there is a different site for different domains.
I bet we can find at least one site for each of the domain. weather it can be home furniture, or it may be exclusively for laptops, or it may be for men grooming and something there is no domain that is left when it comes to eCommerce. This indicated one thing. The number of people who are transacting online. There is a huge growth in the customer segment and more people are joining daily in these eCommerce sites. A person who has ordered once online will prefer to online products from online consequently. It is just the first time the user has to feel convenient and comfortable in ordering online. Once he gets satisfied then he is a potential future customer for the eCommerce company.
Now the point in case on ndia to highlight is the fight of the two established giants in Online market place. With the increasing focus on online market place, these giants are targeting all types of segments and entering into net domains to capture the complete market.
Amazon vs Flipkart the war between one company which is a foreign company amazon and another Indian established Flipkart but recently brought by a foreign company Walmart. The war between these two is visible and we never notice other ecommerce service existence. There two fight in providing the biggest sales to users to capture the market. We notice that during every festival or every event, these two fight in announcing their best sales offers to attract the customers.
Not just in one domain, but these try to enter all market. Amazon which started as an eCommerce services for customer retention like Prime Subscription which provide different premium offers to the customers and the users who brought this subscription are more likely to buy from amazon than any other site. To compete with this Flipkart has launched Flipkart Plus, a rewards oriented program to make customers order more and gain premium and prevailed services. There are the programs that aim to retains customers to their site without losing them to other marketplace.
Amazon has also started to enter the Grocery business. Though it is available in only a few cities, this slowly might expand to many cities. This slowly is being tried to capture the grocery market where already a few players are struggling like Big basket and others. Entering of amazon to these segments is like a suicide to other players. Big Basket saw a drop in sales in the cities where Amazon has started their grocery service. Flipkart has also entered this market and slowly expanding. With these two giants entering the new segment it is a challenge to existing players. and they may not sustain the competition with these giants as they have huge Balance sheet support from parent company which the startups like big basket won’t have.
So we need to analyze how the giants are trying to capture all segments killing literally all the startups in those segments. What the future of eCommerce is going to be. Is it dominated by one player? It seems so. But will have a single dominant player good for consumers. No, it is never a good thing to have a dominant player in any industry. Competition is what makes the services better. But we have to see how the new eCommerce companies sustain these giants who are supported from the back by the huge balance sheet.
Until then we see you in next Article…..