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  1. E-commerce: Amazon, Flipkart, other players wary of going the ‘app only’ way

E-commerce: Amazon, Flipkart, other players wary of going the ‘app only’ way

With many customers still on PCs, companies not ready to close option

By: and | Published: August 2, 2015 12:31 AM
e commerce

We have not decided whether we should go app only or not, said Mukesh Bansal, head of commerce at Flipkart.

Ever since online fashion retailer Myntra went ‘app only’ in May, there have been talks whether other e-commerce players, including its parent company Flipkart, would follow suit. However, major players in the market —Snapdeal, Amazon, Paytm and Flipkart — are currently wary of going ‘app only’.

While for consumers on-the-go, shopping through hand-held devices is a major benefit, the screen size of mobile phones and the app storage space acts as a negative. Also, going ‘app only’ ignores a particular segment of consumers who shop online, because of which companies are taking a cautious approach of not shutting their desktop version.

“We have not decided whether we should go app only or not. But we are thinking seriously about how to win on mobiles. M-commerce will be a huge focus area for us,” Mukesh Bansal, head of commerce at Flipkart, told FE.

Talking about Myntra, he said: “Initially the revenue dropped by 15% after we went app only, but recovered at a later stage.” Myntra had shut its website in May, and customers are now forced to shop through the app.

Gr3

“The Indian internet market is still evolving and mobile internet is driving growth. As much as 50% of the $7-billion e-commerce business is coming through the mobile. However, this does not mean shutting a particular mode will benefit companies. There are consumers who still prefer to shop through desktop, compare prices online and prefer
a bigger screen. Also, it doesn’t cost much to run multiple platforms,” said Ankur Bisen, senior vice-president, retail and consumer products, Technopak.

At the same time, mobile internet is driving the growth of smartphone use. Yahoo’s Flurry Analytics reports that India’s app usage is growing at a rate of 131% year-on-year, outpacing global growth. As per the report, the phablet is the fastest-growing mobile device globally, with growth in India outpacing growth in the US. According to an IAMAI & KPMG Report, India On The Go: Mobile Internet Vision Report 2017, India is projected to have 236 million mobile internet users by 2016,with the number reaching 314 million by 2017.

As per information provided by ecommerce companies, currently, two-third of the transactions of major e-commerce players happen through app and mobiles. But keeping in mind customer choice and internet penetration in tier-II and III cities and rural areas, companies do not want to shut the desktop version yet.

“Snapdeal has seen robust traffic via m-commerce, with over 75% orders coming through the mobile platform. At the same time, our data shows that there are still many customers who use PCs to shop online. Our belief is that we need to be where users are and, therefore, we do not want to force our customers to use one specific medium to shop on Snapdeal,” said Anand Chandrasekaran, chief product officer, Snapdeal.

Paytm also believes that it would want customers to have a choice in terms of mode of shopping. “We don’t think we will go ‘app only’ for now. We believe that consumers should have a choice as to how they want to shop. Most of our spending would be on the brand, and it would be platform agnostic,” Shankar Nath, senior vice-president, told FE.

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