Has Flipkart lost to Amazon?

Flipkart seems poised to lose its cherished status as India’s largest e-commerce firm to arch-rival and role model Inc.’s Indian unit after losing its lead in July—a potential watershed moment in the country’s fledgling Internet business.

Barely three years after launching in India, Amazon (Amazon Seller Services Pvt. Ltd) likely exceeded Flipkart in terms of gross sales in July.

Flipkart reported gross sales or gross merchandise value (GMV) of less than Rs 2,000 crore in July, while Amazon’s gross sales crept up above Rs 2,000 crore, according to five people familiar with the companies’ numbers. Another local online marketplace Snapdeal (Jasper Infotech Pvt. Ltd) reported gross sales numbers of roughly Rs 600 crore, a fall of more than 50% from the sales it had been generating until the end of last year, said two other people, familiar with the company’s numbers.

To be sure, the numbers are only for the month of July and the market share battle between Flipkart and Amazon is far from over.

Flipkart’s numbers also exclude revenue at Myntra and Jabong, the two large fashion retailers it owns. Snapdeal’s numbers exclude sales at FreeCharge, its payments arm. Including Myntra and Jabong revenues, Flipkart is still comfortably ahead of Amazon.

“We continue to have a significant lead over the competition on all important customer parameters including sales. We are also the market leader in the biggest categories of e-commerce including mobiles, fashion, home, electronics and appliances. Our sales are witnessing a steady growth and in the recent months, we have significantly raised the bar of execution, speed of customer delivery and product quality,” said a Flipkart spokesperson in an email.

The upcoming festive season sales will provide more clarity on how the e-commerce market is shaping up. Flipkart is betting on a blockbuster Big Billion Day, its signature yearly sales event that is held in October. E-commerce firms typically generate a majority of their annual sales in the festival-filled Diwali quarter when customers spend freely on a host of products. But given that this time Amazon will have disproportionate spending power, Flipkart and Snapdeal are up against the odds to repeat their solid performances of the past two years.

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