This may not come as a surprise – the big daddy of Indian e-commerce, 10-year-old Flipkart, has become the first online marketplace to cross 100 million registered users. The feat, however, is impressive since its arch rival Amazon India has been catching up fast in market share. In fact, Flipkart claims to be the first company to reach this milestone in a single country outside the US and China.
In a statement, India’s most valuable startup has said that their registered customer base now stands at around 63 percent of the broadband connections in India. [The figures released by TRAI in September 2016 put the number of broadband connections in the country at under 160 million.]
Binny Bansal, Co-founder and CEO, said,
“We would like to thank our entire family of 100 million customers who have been a part of this wonderful journey. This is a small step in our efforts to build a platform that provides quality products accessible and affordable to millions of Indians shopping online. Since the time we sold the first book to our first customer in 2007 till today, our journey has always been about providing a superior shopping experience to our customers while continuously raising the quality of service and selection. This milestone has further energised us to ramp-up our efforts and build a world-class shopping destination.”
This year has been a roller coaster ride for Flipkart. At the onset of the year, Binny Bansal replaced his co-founder Sachin Bansal as CEO, while the latter became executive chairman. Within a month, veterans Punit Soni, Mukesh Bansal and Ankit Nagori left the firm. Their grocery delivery service ‘Nearby’ had to shut down, sellers were miffed about increased commissions, and rumours of employee lay offs were in the air.
Yet, Flipkart reportedly hit the 75 million registered users mark in March 2016, having crossed 50 million installs the previous month. In fact, it claims to have access to 60 percent of the population using internet in India, as per a report by TRAI in March.
Flipkart came up with innovations in payments and logistics too, including no-cost EMIs, alternative delivery methods, and ‘Flipkart Assured’, which is expected to fight Amazon Prime. Additionally, their recent acquisition PhonePe has become India’s first UPI-based mobile payments app.
But not all is well for Flipkart. A double devaluation and Amazon pouring $3 billion into the Indian market has caused the competition to get fiercer. In June, a report by Kotak Institutional Equities said that Amazon generated between 33 to 62 percent more monthly traffic than Flipkart from November 2015 to May 2016. It added that Amazon had 180 million visitors monthly, which is 50 percent more than Flipkart’s 120 million. In October, once the festive season sales take off, the two titans are bound to see a rise in these numbers.
There have been reports of Amazon beating Flipkart in sales for two consecutive months. However, with Flipkart reportedly shifting back to an inventory model, customers can expect a better experience in terms of quality, which in turn will help in acquisition and retention. According to a new study by Bank of America Merrill Lynch, Flipkart will continue to be the number one e-commerce player in the country, at least till 2019, with 44 percent GMV market share, while Amazon will take 37 percent. With Alibaba expected to enter the scene before the end of the year, e-commerce seems to be moving towards its next phase.