Peak FlipKart? Mobile App downloads aren’t necessarily representative of reality but they’re indicative of broader market trends. It’s interesting to see how local e-commerce players have ceded ground to Amazon. Investors based their exit hypothesis on consolidation and acquisition by foreign players (few even sold public offerings to their Investment Committees) but far from exiting — companies are now fighting to remain relevant in the wake of Amazons dominance.
We’d previously talked about Order Frequency (click here) and Average Order Values (click here) in our earlier wires and noted how Amazon’s Prime service in e-commerce and video are skewing the pitch in its favour. Given the rapid erosion of investor sentiment & board room battles playing out at various start ups — it’s hard to see how other players are going to buck the trend.
Flipkart’s acquisition of e-bay India and its most recent funding round (+ rumors of a SnapDeal acquisition) maybe a step in the right direction but in order to reduce their dependence on investor capital they need to get to per order profitability.
A quick note on the Indian consumer — I found this chart particularly compelling. On the one hand we have Amazon that seeks to impress users with next day delivery and a great customer experience, on the other we have Ali Express that takes as long as 45 days to send over the good stuff. Both to me are representative of India’s increasing acceptance of e-commerce and emergence of different customer types. Those that seek convenience and are willing to pay for it and those that seek savings and are willing to wait for it.
Thanks for your time,
Ashish
- Team KG
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You can reach me on ashish@kalagato.com
