Just read a great article on how Amazon is growing faster and outcompeting local e-commerce giants in India by Vijay Govindarajan and Anita Warren in Harvard Business Review titled How Amazon Adapted Its Business Model to India
So these are 3 big guns in the e-commerce sector in India in 2016:
As Vijay Govindarajan and Anita Warren point out, Amazon did not come into India and succeed by doing what helped it make the giant it is in USA.
When Amazon decided to enter the Indian e-commerce market, it was clear from the outset that something would have to give. That something was the very business model that had made Amazon an internet powerhouse in the U.S.
Especially Amazon being a foreign entity it had to play under different rules. Now the advantages and disadvantages that Amazon faced in India are highlighted as follows:
The good news: included a very young populace — more than 65% under age 35 — rising levels of disposable income, and ubiquitous cell phone ownership (80% of the population, by one estimate).
The bad news: 67% of the population lives in rural areas characterized by an underdeveloped infrastructure. Only about 35% of India’s population is connected to the internet. Cash, not credit cards or checking accounts, is still the rule. And, determined to protect its own, India enacted a rigid FDI policy restricting foreign multibrand retailers from selling directly to consumers online. That meant any venture would basically be a third-party seller for Indian-made products.
After launching India in 2013, Amazon India went about implementing it’s roadmap by doing the following things:
You should check out the whole article as a quick read into how a western business (albeit a very big one with deep pockets) can make it’s mark in India or other emerging markets.
Of course these are still early years and no one is yet an outright winner or loser and India is big enough to have multiple e-commerce players ply their trade.
Image sources: Amazon.in, Flipkart.com, Snapdeal.com