How The E-commerce Industry Is Driven By Flipkart, Amazon Majorly
Regional and local brands have a very interesting opportunity through these two marketplaces
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Flipkart and Amazon put to gather are 87% of total e-commerce retail market wherein Flipkart is a slightly ahead of Amazon.
Flipkart in last few year have done a major acquisition like Myntra, Jabong and e bay. With Jabong and Myntra it has taken a good lead in
Fashion E-commerce. Since most of the other e-commerce platforms marginalised there is one to one competition in these two for market leadership
Major impact e-commerce has been in the mobile industry. Brands like Motorola relaunched through the e-commerce platform. One Plus, Asus, Redemi all have an e-commerce centric strategy. Another big major impact is for SME and Regional Brands. Flipkart and Amazon are able to deliver across 19000 pin codes in India for an SME or A regional brand this kind of market penetration was impossible.
As much as 13 Crore customer visit Flipkart or Amazon regularly. This customer base makes them unique for brands. We need to divide these brands into two 3 category - Nation brands which are among to top brands in the category , Second national brands who are 2nd tier brands third Regional / Local brands. For all three category E-commerce has a different relevance.
All national brands which are in top slot recognised e-commerce as one of the sales channels and have a clear strategy for the same. They balance product offering price point and resellers in both marketplaces. They also have a challenge in balancing their offering along with general trade offering. Any band which is fighting for market share cannot afford to ignore Flipkart and Amazon. For these two marketplaces use these brands to Drive there GMV and get customer traction.
For tier brands, Flipkart and Amazon are two marketplaces which give 25 to 40% sales and in some brands even higher. Here these marketplaces driving these brands through deals. They are becoming more and more relevant to these brands hence monopolising the offerings. For brands, it is a cost-effective way to drive numbers. They need not spend on overheads for extensive distribution structure and offline promotions.
Regional and local brands have a very interesting opportunity through these two marketplaces. These brands get all India presence through Flipkart and Amazon. These brands are driven by profitability. Today Myntra which is part of Flipkart group would be the first marketplace in India which would be operationally profitable in next few quarters. This is only happening as they are balancing horizontal and vertical play. Regional brands play a major role in that.
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