Will Amazon & Alibaba face their toughest battle in India?

Flipkart’s latest acquisition of eBay has once again put the odds in its favour. The question is: will Flipkart’s move be a game changer of sorts? Will it help domestic players consolidate and emerge as a tough competition for global takeover?

by Ruhail Amin
Published - Apr 20, 2017 7:57 AM Updated: Apr 20, 2017 7:57 AM
Will Amazon & Alibaba face their toughest battle in India?

The battle between local and international ecommerce players for regional dominance is far from over. Though much has been written about the losing grip of Indian ecommerce players like Flipkart, Snapdeal etc., and how they have splurged investors’ money with profitability nowhere in sight, it’s still premature to write them off.

The coming of international ecommerce giants like Amazon, and now Alibaba, has earned the Indian ecommerce players some more ire. Especially from the domain specialists, who regularly write obituaries on local players, but had to swallow their criticism when Flipkart made a surprise move by acquiring eBay India assets recently. There is no doubt that ecommerce players like Amazon and Alibaba (which has recently announced its India operations via Paytm) have robust global business models in place. Given their deep pockets and an unmatched ability to burn cash, they have left domestic ecommerce players with only two options: bulk up cash reserves or merge.

However, Flipkart’s latest move has once again put the odds in its favour. The question is: will Flipkart’s move be a game changer of sorts? Will it help domestic players to consolidate and emerge as tough competition for global takeover?

Harish Bijoor, Brand Consultant and Founder Harish Bijoor Consults Inc., thinks that the Indian ecommerce players are giving a tough fight to retain the domestic space and it is too premature to call it the end of their journey. “Indian ecommerce players are showing grit in a very competitive market space. The fight-back seems to have begun for sure. The Flipkart acquisition of eBay is a classic example. The Indian ecommerce sector, which is heavily over-invested, is saying it loud and clear that it is not going to be a pushover to a global player. Amazon might meet its toughest competition in India,” states Bijoor.

 “Being early starters and having acquired a significant share of the online Indian customers, many of the Indian players today have a stabilized model which has enhanced the investor sentiment.  This is expected to further help them win over the market in India with investments in technology, customer experience as well as innovative delivery models,” feels, Sreedhar Prasad, Partner -Ecommerce, KPMG in India.

Terming the current developments in the Indian ecommerce space as a natural phase in the coming of age of the domestic ecommerce space, Rajiv Dingra, Founder and CEO, WATConsult, says, “Consolidation is inevitable in the ecommerce space. And, while you and I see a distinction between Indian and non-Indian ecommerce sites, the consumer does not. For them, whoever is giving them the product at the right price, delivered as per their time, is a better e-commerce player and hence, I don’t see this as a battle between Indian vs Global ecommerce players. I think this is an important phase in the coming of age of ecommerce in India.”

With the Indian ecommerce players not ready to give up their hold on domestic turf without a pitched battle, the mission to take over the domestic ecommerce space seems like a distant dream for global giants like Amazon and Alibaba for now.

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