The battle for supremacy in India’s bulging e-commerce market between Amazon.com Inc, Flipkart.com and Snapdeal.com is rapidly heating up with multibillion-dollar investments, trolling on Twitter Inc and squabbling over exclusive selling rights.
Gaining ground after entering India in 2013, Amazon has been embroiled in rounds of one-upmanship with its local counterparts as competition intensifies for a greater slice of the lucrative market.
“In such a crowded marketplace it is difficult to distinguish between the firms based solely on the products they sell or the customer service provided,” industry analyst Shriram Subramanian said.
“It’s brutally competitive, so there’s a strong itch to take a dig at the opposition in an attempt to stand out to customers,” added Subramanian, head of Indian corporate advisory firm InGovern.
Flipkart.com, India’s largest e-commerce firm, and US behemoth Amazon.com exchanged barbed comments on Twitter recently when portal Reddit India tweeted a photograph showing an Amazon delivery box sitting at Flipkart’s reception.
The tweet suggested Flipkart staff preferred to order from Amazon. The Indian company hit back, posting: “We recycled said packaging as our reception’s dustbin.”
Amazon then weighed in, tweeting: “There is a bit of Amazon in every eCommerce company #justsaying” — an apparent reference to the fact that Flipkart’s founders used to work for the US company.
Internet entrepreneurs Sachin Bansal and Binny Bansal, who are not related, quit Amazon to start Flipkart in 2007, with the Bangalore-headquartered company rapidly establishing itself as India’s largest online store.
Sachin and Snapdeal cofounder Rohit Bansal, again no relation, traded jibes on their personal Twitter accounts recently over the latter’s purported comments that it was difficult to find good staff in India.
“Don’t blame India for your failure to hire great engineers. They join for culture and challenge,” Sachin Bansal wrote to Rohit Bansal.
The Snapdeal chief operating officer responded saying his company had been voted one of the best places to work in India.
Flipkart is estimated to be worth US$15 billion and commands up to a 44 percent market share, well ahead of Snapdeal, which was launched in 2010 and enjoys about 22 percent of sales, according to analysts.
Amazon occupies about 12 to 14 percent, insiders say, and has its rivals firmly in its sights, despite coming to the party in India late.
“Amazon has done very well in the two years since launching in India because already it has managed to start challenging market leaders who had early movers’ advantage,” Technopak retail analyst Pragya Singh said.
India’s e-commerce market, although small in comparison to China or the US, is expected to rise swiftly to be worth more than US$32 billion by the end of the decade.
According to recent local newspaper reports, Amazon plans to invest US$5 billion in India to turn the nation into its biggest market outside of the US, while Flipkart and Snapdeal are spending big just to stay ahead.
Flipkart raised US$1 billion in funding last year, while Bloomberg reported on Monday that Snapdeal is set to receive a US$500 million war chest from Chinese e-commerce giant Alibaba Group Holding Ltd (阿里巴巴) and Taiwanese electronics manufacturer Hon Hai Precision Industry Co (鴻海精密).
The investment, which might also include Japan’s Softbank Group, according to Bloomberg, values Snapdeal at about US$5 billion, the report said.
Amazon India vice president and country manager Amit Agarwal claimed its Web site was receiving more hits than Flipkart’s.
“We are today the largest online store in India with over 25 million products,” he said in an e-mail. “Not only that, we have the largest in-stock selection of about 800,000 products available for guaranteed next-day delivery. This is by far multiple times higher than what anyone else in the same space offers.”
Amazon and Flipkart have also tussled over exclusive selling rights, with both accused of alleged infringement in two separate cases, one of which is before the High Court in New Delhi.
Flipkart reportedly sold novelist Amish Tripathi’s latest book when Amazon had sole rights. The US company faced a similar allegations over author Chetan Bhagat’s Half Girlfriend, which only Flipkart was apparently allowed to distribute.
Both companies rejected any violation, saying they were open marketplaces connecting sellers with buyers, the Economic Times reported.
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