Which One Is Better Amazon Or Flipkart?
- February 22, 2019
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After Flipkart was founded in October 2007 by Sachin Bansal, the e-commerce site achieved a great amount of success in a very short period of time. At that time, there were just a few e-commerce sites in India. The e-commerce giants like Amazon, E-bay, and Alibaba were yet to make the entry in the e-commerce field in India.
After initial years of success, when more and more e-commerce portals came into existence, and International companies like Amazon, E-bay, and Alibaba made entry into India, it became tough for Flipkart to survive. Experts say it was not prepared to face the competition, hence its business went down in days from the sky to earth. Flipkart began to fight for its survival in the country.
According to a recent report, over the years, the e-commerce portal has not been able to generate enough revenue to cover its all expenditures. It has to cover the expenditures on salaries of the employees, bills, rents and the cost of manufacturing.
Entry Of Amazon and The Downfall Of Flipkart
At a time, when Flipkart is losing its grip on India’s mobile shoppers, Amazon which has always been neck-to-neck with Flipkart is fast taking over the latter.
Amazon is gaining at the expense of Indian e-commerce portals such as Flipkart, Snapdeal. The user base is shifting fast and loyalty level towards Amazon is growing. Think tanks say Flipkart has failed to take advantage of the six-year head start on Amazon. Amazon arrived in India only in 2013.
If different media reports are to be believed, the overall performance of Flipkart has dipped. Though it still captures a large share of the market, its sales declined by 11.5% in 2017 while at the sales of Amazon increased by 46%. The maximum traffic to Flipkart comes via mobile sites or its app. In fact, in 2016, its 80 percent traffic was via its app or mobile sites.
The recent stats, however, indicate that the popularity graph of Flipkart is declining day by day. Flipkart users don’t seem keen on browsing and staying via its Application. Its active users per minute declined 42.6% in 2017 compared to 2016. While at the same time, it ticked up by 15% in this period.
According to media reports, Amazon has 10 times more conversion rate in India than Flipkart and other e-commerce sites in India.
Among the factors that are believed to have provided an edge to Flipkart in India, is its breadth of offering and ability to adapt its successful business model from abroad to India.
At the global level, its business is a well- oiled machine having deep pockets. So the expending in India is not an issue for it. As India’s national e-commerce businesses are coming over a cash crunch, the online shoppers in India will have to look for alternatives. Among all, Amazon has really succeeded in grabbing eyeballs.
After a short-lived phase of unprecedented success, we are witnessing the fall of Indian giants in the e-commerce industry. In the absence of any competition, Indian e-commerce sector has to be dominated by international players like Amazon, E bay and now Walmart. With Walmart acquiring 77 percent stake of Flipkart, economists say the deal will make it tougher for e-commerce businesses in India to survive and sustain in the market. They say it will impact both the competitors and the consumers.