Competition set to heat up, business to boom.
By Dileep Thekkethil
Indian e-retail competition is likely to intensify in the coming months as Kunal Bahl, the CEO of Snapdeal, the Delhi-based e-retailer, said in an interview that his company will surpass Flipkart to become India’s top e-commerce company by March 2016.
Bahl, in an interview with CNBC, said today that his company is currently the second biggest e-retailer in India, but the status will soon change as the company, which has 32% share in the market, will soon rise up to 44%, pushing back Flipkart to the second spot and US-based Amazon to the third position with just over 15% of the market share.
“Flipkart had a headstart of $500 million and 10,000-person, but it doesn’t seem like that any longer. We are quickly covering ground there. Also, a lot of the investments we made in infrastructure and other platforms like consumer-to-consumer (C2C) and payments are paying huge dividends,” said Bahl, who was speaking to CNBC at the Morgan Stanley Asia Pacific Summit in Singapore.
“Our market share is only climbing year-on-year. Three years ago, our market share was zero,” he added.
India’s e-commerce industry has achieved tremendous growth rate in the last two years, with global players like Amazon and eBay making their presence felt in the market, which is predicted to witness a further boom in the coming years.
The stable growth in the telecommunication sector has played catalyst in the growth of ecommerce in india as companies now focus on mobile users and mobile apps. Flipkart had earlier this month reintroduced the mobile web platform for interested buyers who have low-end smartphones.
Also, the leaps and bounds made in the payment systems have increased the confidence of buyers. RBI’s OTP password is one feature that has helped in fostering a friendly atmosphere for online payment. Adding to this Cash-on-Delivery is one feature that has proved as a successful payment option, particularly for Indian buyers who were sceptical about buying products online.
According to the estimates of Associated Chambers of Commerce and Industry of India, along with PricewaterhouseCoopers, the e-commerce industry of India will register an annual growth of 35% and will cross the dream figure of $100 billion by 2019. The current turnover from e-commerce business is estimated as $17 billion.
Snapdeal, like other ecommerce websites in India, has been keen in making their web and mobile experience faster and more reliable. Adding to this, they have been in an acquisition spree, buying technology firms that can speed up theirmission to reach the top tier. According to Bahl, 30% of Snapdeal buyers still use 2G network.
Snapdeal, which is identified as an Indian version of the Chinese firm, Alibaba, has been buying out start-ups capable of assisting it in telecommunication and data analytics space. Recently, Snapdeal acquired mobile recharge firm Freecharge and digital finance distribution platform RupeePower.