Amazon and Flipkart are the two pioneers that have redefined online shopping in India and become household names. The Indian market is a goldmine for these global eCommerce giants. With a potential user base exceeding 1 billion people, it’s a market that neither Amazon nor Flipkart can afford to lose or take lightly.
So, who’s winning this high-stakes game? Amazon or Flipkart? If you’re a seller aiming to maximise profits or contemplating dropshipping on Amazon or Flipkart, knowing which platform is the reigning champion in India can significantly impact your choices and strategies.
This blog will scratch the surface and delve deep into the intricacies of Amazon vs. Flipkart in the Indian eCommerce space. We’ll dissect market shares, financial performances, unique selling propositions, and much more to answer the million-dollar question: Who is performing best in Indian eCommerce?
Historical Background: An Overview of Amazon and Flipkart in India
Amazon
When Amazon set foot in India in 2013, a seismic event sent ripples across the Indian eCommerce landscape. Amazon’s founder, Jeff Bezos, didn’t just dip his toes in the water; he dived in head first with what analysts describe as a “blank-check approach.”
The company committed an estimated $10 billion to India, signalling its intent to dominate the market, not just participate. This financial muscle was flexed in various strategic initiatives, including the rapid expansion of Amazon Prime. This membership program has become a cornerstone of Amazon’s customer retention and marketing strategy.
Amazon Prime in India is an expedited shipping that includes Prime Video and Prime Music, designed to lock customers into the Amazon ecosystem. The company has invested at least $1 billion annually to build out this program, aiming to make it as indispensable in India as in Western markets.
This aggressive investment strategy has been paying off. Amazon had captured a 31.2% market share by 2018, hot on the heels of Flipkart.
Flipkart
Founded in 2007 by Sachin Bansal and Binny Bansal, Flipkart started as an online bookstore. It was a homegrown alternative at a time when the concept of online shopping was still nascent in India.
Over the years, Flipkart expanded its product offerings to include everything from electronics to fashion and furniture, becoming a one-stop shop for the Indian consumer. By 2018, it had a 31.9% market share, and when you add the market share from its fashion speciality sites like Myntra and Jabong, that number jumps to 38.3%.
But the game-changer came in 2018 when Walmart acquired a major stake in Flipkart for a whopping $16 billion. This strategic alliance gave Flipkart the financial backing and global expertise it needed to fend off Amazon’s aggressive push.
Walmart’s acquisition had a multi-fold impact. First, it provided Flipkart with additional capital to expand and innovate. Second, it gave Flipkart access to Walmart’s global supply chain and retail expertise. This acquisition has been instrumental in Flipkart’s plans to open physical stores and expand its grocery segment, leveraging Walmart’s brick-and-mortar expertise.
Market Share and Financial Performance
Statistics on Revenue and Market Share
As of 2021, Flipkart commands an impressive 48% of the market, dwarfing Amazon’s 26%. This is a significant shift from 2018 when the two companies were almost neck-and-neck.
But market share is just one part of the equation. Flipkart’s revenue from operations soared by 25% to reach Rs 42,941 crore in the most recent fiscal year. Even more notably, its losses shrank by 22% to Rs 2,445 crore, indicating a path toward profitability.
On the other hand, Amazon reported a revenue of $5.56 billion (approximately Rs 42,260 crore) for the same period.
While the revenue figures closely match, the market share disparity suggests Flipkart is doing more with less, effectively converting its customer base into higher sales.
Consumer Spending on Both Platforms
The market share and revenue figures also hint at consumer spending habits on these platforms. Amazon’s 35% retention rate during the festive months of October 2021 and 2020 suggests a loyal customer base in India, particularly among basic users.
Flipkart lags slightly behind with a 25% retention rate, but it’s essential to note that this doesn’t necessarily indicate lower spending. Flipkart’s higher market share and comparable revenue imply that it might be attracting a broader, more diverse customer base who are spending enough to contribute to its larger market share.
The Indian Festive Season for Sales
The festive season in India is marked by high-profile sales events like Flipkart’s “Big Billion Days” and Amazon’s “Great Indian Festival.” These events are similar to Black Friday in the U.S. but with an Indian twist, featuring steep discounts, exclusive product launches, and special offers that drive consumer spending through the roof.
Both companies pulled out all the stops during this period to capture consumer attention and wallets. The retention rates during these months are particularly telling. Amazon’s higher retention rate suggests it has been more successful in keeping its existing customers engaged, likely through its Prime membership perks and various product offerings. Flipkart, although having a lower retention rate, compensates by attracting a larger volume of new customers, possibly from
Unique Selling Propositions (USPs): Amazon vs Flipkart
Amazon
Amazon Prime and Its Benefits
For an annual fee of around ₹1499 in India, Prime members gain exclusive access to entertainment with Prime Video and Prime Music. But the perks don’t stop at streaming. Free and fast delivery options make it incredibly convenient for members to receive their orders in record time.
Wide Range of Payment Options
Amazon’s payment ecosystem is as diverse as India itself. Amazon covers you whether you’re a credit card swindler or a UPI enthusiast. The platform supports Credit/Debit cards from multiple banks, UPI, mobile wallets, and even Cash on Delivery (COD). For those looking to stagger their payments, Amazon offers EMI options and a unique ‘Amazon Pay Later’ service, making high-ticket purchases more manageable.
International Brand Presence
Amazon’s global footprint is a significant advantage, especially for those looking for international products. The trust factor that comes with Amazon’s international reputation is unparalleled. The platform offers a seamless shopping experience from Amazon India or Amazon U.S.
Flipkart
Flipkart Plus and Its Features
Flipkart Plus is the answer to Amazon Prime. This loyalty program offers free and fast delivery but adds its unique twist with “Plus Coins,” which can be earned and redeemed for additional benefits. Flipkart Plus provides early access to sales and promotions, ensuring loyal customers always get the first pick.
Specialised Subsidiary Fulfilment Service Known as Ekart
When it comes to logistics, Flipkart has an ace up its sleeve with Ekart logistics, its in-house fulfillment service. Ekart ensures efficient and fast delivery, even to the most remote locations in India. The in-house nature of this service allows for better quality control, easy returns, and reliable Cash on Delivery (COD) options.
Homegrown Advantage
Flipkart’s roots in the Indian market give it a unique home-field advantage. The company deeply understands local consumer behaviour, which is evident in its tailored marketing and sales strategies.
User Experience: Amazon vs Flipkart
Comparison of Website Interfaces
When it comes to website design and interface, both Amazon and Flipkart offer clean, intuitive layouts that prioritise user-friendliness. Amazon’s interface is globally standardized, offering a sense of familiarity to users who have shopped on its international platforms.
Flipkart, on the other hand, brings a localised touch to its interface. The platform is designed keeping in mind the diverse Indian audience, offering language options and a more colourful design that resonates with the local culture. Flipkart’s homepage is often filled with ongoing sales and promotions, immediately drawing the user’s attention to deals and discounts.
Checkout and Payment Procedures
Amazon offers a ‘1-Click’ ordering feature that allows for a frictionless checkout experience. The platform supports a wide range of payment options, including Credit/Debit cards, UPI, mobile wallets, and Cash on Delivery (COD). The ‘Amazon Pay Later’ feature is a standout, offering users the ability to buy now and pay later, which is particularly useful for high-value purchases.
Flipkart’s checkout process is equally smooth but has unique features like ‘Flipkart Pay Later’ and ‘Cardless Credit.’ These options provide the user with financial flexibility, making purchasing easier.
Customer Support Services
Amazon’s customer service is globally acclaimed and offers multiple support channels, including chat, email, and phone. The platform also provides a comprehensive FAQ section and video guides to troubleshoot common issues.
Flipkart’s customer support is no less impressive. The platform offers 24/7 support through its ‘Help Center,’ which provides solutions to various issues from order tracking to returns. Flipkart also offers a callback service, where customers can request a call from a customer service representative.
Product Range and Availability: Amazon vs Flipkart
Categories and Types of Products Available on Both Platforms
Amazon’s product catalogue is nothing short of exhaustive. From books and electronics to groceries and fashion, Amazon aims to be a one-stop shop for all consumer needs. The platform also offers specialised categories like Amazon Pantry for groceries and Amazon Fresh for fresh produce.
Flipkart, too, boasts an expansive product range but adds a localised touch. It offers various categories, including electronics, fashion, home appliances, and even furniture. What sets Flipkart apart is its focus on Indian brands and products that cater to local tastes and preferences.
Exclusive Products or Brands Tied to Each Platform
Exclusivity can be a significant draw for consumers, and both Amazon and Flipkart leverage this to their advantage. Amazon has exclusive partnerships with several brands, particularly in the electronics segment. Products like Kindle e-readers and Amazon Echo devices are exclusively available on Amazon. The platform also offers AmazonBasics a range of high-quality, affordable products that range from home essentials to tech accessories.
Flipkart counters this with its range of private labels and exclusive brand partnerships. Brands like MarQ (for electronics) and Anmi (for fashion) are Flipkart exclusives that have garnered a loyal customer base. Flipkart’s acquisition by Walmart has also led to the introduction of international brands exclusively available on Flipkart in India.
Upcoming Sales and Offers: Amazon vs Flipkart
Amazon’s Sales Events
Amazon’s sales calendar is a well-thought-out strategy aimed at maximising customer engagement throughout the year. One of the most anticipated sales is the “Nine Days of Navratri,” which taps into the festival’s cultural significance.
The “Great Indian Festival” is another blockbuster event that usually coincides with the Diwali season. It’s a multi-day extravaganza featuring exclusive launches, cashback offers, and discounts across all categories.
Amazon’s “Diwali Sale” and “Christmas Sale” are other significant events that offer a range of deals, including “Lightning Deals” that last for a limited time and “Deal of the Day” that offer substantial discounts on popular products.
Flipkart’s Sales Events
Flipkart has a robust sales calendar but with a more localised touch. The “Budget Dhamaka” sale is a unique event that targets value-conscious consumers, offering quality products at budget-friendly prices.
The “Big Billion Day Sale” is Flipkart’s flagship event and is often considered the biggest sale in the Indian eCommerce calendar. It spans multiple days and covers all product categories, from fashion to electronics.
Flipkart hosts a “Christmas Sale” and a “Year-End Sale,” designed to capitalise on the holiday season. These sales offer discounts, buy-one-get-one-free offers, and exclusive product bundles, making them highly attractive to consumers looking to make the most of their year-end shopping.
Logistics and Fulfilment: Amazon’s FBA vs Flipkart’s Ekart
Amazon’s Fulfilment-by-Amazon (FBA)
When sellers opt for FBA, Amazon takes complete responsibility for storing the inventory, packing the products, and shipping them to the customers against a minimal seller fee. This centralised approach allows Amazon to offer benefits like Amazon Prime, which promises one or two-day delivery on eligible products.
With strategically located fulfillment centers, Amazon can deliver products at an astonishing speed, sometimes even within a few hours, depending on the location.
Flipkart’s Ekart
Flipkart’s answer to FBA is Ekart, its in-house logistics and supply chain arm. Ekart logistics gives Flipkart an edge in understanding the unique challenges of the Indian market, such as diverse geographic conditions and varying levels of infrastructural development.
One of Ekart’s most significant advantages is its Cash on Delivery (COD) feature, which is still a preferred payment method for a large Indian population. This feature, combined with efficient tracking and easy returns, makes Ekart a reliable choice for consumers. If you want your courier to be delivered by Ekart, try NimbusPost for quick and hassle-free shipping.
Conclusion: Who is Leading in India—Amazon or Flipkart?
As we reach the end of this comprehensive analysis, the question that looms large is: Who is truly leading the e-commerce race in India—Amazon or Flipkart?
While both online marketplaces have made significant strides in capturing the Indian market, the data suggest that Flipkart now has the upper hand.
Flipkart’s Dominance in Numbers
Flipkart’s market share in 2021 stood at an impressive 48%, overshadowing Amazon’s 26%. Flipkart also reported $23 billion in gross sales in India during 2021, compared to Amazon’s estimated $18 to $20 billion. These figures are a testament to Flipkart’s deep penetration into the Indian market and its ability to resonate with the Indian consumer.
The Homegrown Advantage
Flipkart’s homegrown roots give it a unique understanding of the diverse and complex Indian market. This has been a significant factor in its ability to outperform Amazon. The company’s localised strategies, from marketing campaigns to product offerings, resonate well with Indian consumers, giving it a distinct edge.
The Walmart Factor
The acquisition by Walmart has further fortified Flipkart’s position, providing it with the financial muscle and global retail expertise to expand and innovate continually.
The Geographical Divide
While Amazon may have a stronghold in larger Indian cities, Flipkart’s popularity isn’t confined to urban centers. It has a more evenly distributed market presence, making it a household name even in smaller towns and cities.
- Dropshipping on Amazon
- Amazon Identifiers
- Amazon Marketing Strategy
- Online marketplaces in India
- eCommerce
- Ekart Logistics
- Cash on Delivery
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