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There is something strangely apt about the Flipkart and Snapdeal co-founders sniping at each other on Twitter—a rivalry between two of India’s e-commerce giants playing out online. That’s just for starters.
The planned entry of Chinese online retail giant Alibaba—an investor in Snapdeal—into the Indian market is going to muddy already murky waters.
The strategies adopted by Indian companies thus far have been suited to exploiting a new market and establishing themselves. That is no longer the case. Deep discounts are not a sustainable, long-term option, as they are discovering—Morgan Stanley’s recent marking down of Flipkart’s shares by 27% is a case in point.
But how will the necessary shift to a focus on scalability and operational efficiency play out against competing pressure from Alibaba, the world’s largest e-commerce company? However it pans out, the dust is set to fly as India’s online retail sector matures.