Jeff Bezos hints at more investments, says Amazon fastest online marketplace in India
Jeff Bezos claims Amazon has become the leader in India’s $15 billion online retail market, after the firm reported quarterly numbers that blew past expectations
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Bengaluru: Amazon founder and CEO Jeff Bezos on Thursday claimed that the Seattle-based e-commerce giant has become the market leader in India’s $15 billion online retail market, after the firm reported quarterly numbers that blew past market expectations.
Bezos’s statement on Amazon’s position in India would indicate that the online marketplace has toppled local e-commerce poster boy Flipkart from its perch at the top. Amazon cited data compiled by market analytics firms comScore and SimilarWeb to back its claims of being the market leader in India.
According to both the firms, Amazon.in is the fastest growing marketplace in India and the most visited site on both desktop and mobile, according to analytics firms comScore and SimilarWeb. Amazon also cited data compiled by app analytics firm App Annie, which said that the Amazon.in mobile app is the most downloaded shopping app in India.
However, at least three executives directly familiar with the numbers of both companies said, on the condition of anonymity, that Flipkart still remains ahead of Amazon in India in terms of gross monthly sales, including sales from fashion retailers Myntra and Jabong. Flipkart owns both Myntra and Jabong.
“Our India team is moving fast and delivering for customers and sellers. The team has increased Prime selection by 75% since launching the program nine months ago, increased fulfillment capacity for sellers by 26% already this year, announced 18 Indian Original TV series, and just last week introduced a Fire TV Stick optimized for Indian customers with integrated voice search in English and Hindi,” said Bezos.
Amazon on Thursday indicated that Prime was proving to be a major growth driver in India. Mint had reported earlier in April that the Amazon Prime membership programme has become an important lever for the company in its battle against Flipkart, accounting for nearly 30% of all orders on Amazon India.
Bezos also hinted that Amazon, which is the world’s largest online marketplace, would continue to step up its investments in India. He has already committed to spend at least $5 billion to grow Amazon in India, which is arguably Amazon’s most important international market and one that it is desperate to conquer after losing out to Alibaba in China.
“We’re grateful that customers are responding—Amazon.in is the most visited and the fastest growing marketplace in India. It’s still Day 1 for e-commerce in India, and I assure you that we’ll keep investing in technology and infrastructure while working hard to invent on behalf of our customers and small and medium businesses in India,” Bezos said.
However, Amazon’s expansion into India is coming at a price—losses from its international business came in at $481 million, mainly due to its investment in India. Amazon has already spent at least $2 billion of that investment, according to regulatory filings.
“We continue to be encouraged by both the response from customers and sellers (from India). As far as level of investment is concerned, it is certainly one of our important investment areas. We see a lot of potential for the country and our business there,” said Amazon CFO Brian T. Olsavsky in a post-earnings conference call with investors.
Amazon started operations in India in June 2013, several years after arch rival Flipkart was started by former Amazon executives Sachin and Binny Bansal (not related) in a two-bedroom flat in Bengaluru. In 2014, Bezos committed to spend $2 billion to grow Amazon’s India business, but in June last year, Amazon upped its India commitment by another $3 billion.
“In India, we started from scratch and have built a lot of things ourselves. And it’s always going to depend on the country that the dynamics in that country both for retail, for online, and for foreign investment. But a real key factor in all of this generally is management bandwidth as well,” said Olsavsky.