Flipkart’s seller base now at par with Amazon | The Financial Express

Flipkart’s seller base now at par with Amazon

Flipkart hit the milestone seller mark just ahead of the festive season where e-commerce companies were expected to garner $11.8 billion in gross merchandise value (GMV), an increase of 28% year-on-year (y-o-y), according to analysts at RedSeer.

Flipkart’s seller base now at par with Amazon
That compares with about 0.45 million sellers Flipkart had as of 2021 and Amazon’s 0.7 million by end-2021, according to analysts at Bernstein.

Walmart-owned Flipkart has closed in on its largest competitor, Amazon and now matches the latter’s seller base of 1.1 million, across its main platform and social commerce website, Shopsy.

That compares with about 0.45 million sellers Flipkart had as of 2021 and Amazon’s 0.7 million by end-2021, according to analysts at Bernstein.

While the e-commerce space has largely remained fragmented, Amazon was estimated to have a leading, roughly 45%, share in the smartphone category, driven by strong brand relationships. While Flipkart — including Myntra — is estimated to be the dominant player, commanding about 60% share in the fashion category whereas Amazon, in the same category, had only between 25% and 30% share, Bernstein analysts added.

Flipkart hit the milestone seller mark just ahead of the festive season where e-commerce companies were expected to garner $11.8 billion in gross merchandise value (GMV), an increase of 28% year-on-year (y-o-y), according to analysts at RedSeer.

Since 2018, GMVs during the festive season have accounted for 18-20% of the overall GMV for e-commerce and retail companies. Flipkart had a GMV of $15 billion in the financial year (FY) 2021, which has now increased to $23 billion. That compares with Amazon’s $18-20 billion.

Last October, the peak festive season, Flipkart performed better than Amazon. “Flipkart was the leader during the festival, capturing a share of 62%, while Amazon had a share of 27%. Amazon lagged behind Flipkart in total downloads during the festival as well — 43.6 million vs 50.5 million,” Bernstein said in a report.

Also Read: Amazon doubles seller base to 1.1 million

The two giants have also seen increased competition from SoftBank-backed Meesho, a social commerce app, which has been strengthening its position in Tier 2 and beyond regions, thanks to its zero commission policy for sellers. In a bid to attract sellers from smaller towns and local business owners, Amazon too slashed its seller fee by 50% for new sellers for 90 days. In India, the US-based e-commerce company’s 1.1 million sellers were equally divided between the metro and non-metro cities, Noorulamin Patel, vice president of Amazon India told FE in an interview.

The incumbent players are also likely to be challenged by the government’s initiative to democratise e-commerce by introducing the open network for digital commerce (ONDC). Kumar Vembu of GoFrugal believes marketplaces like Amazon and Flipkart collect buyers’ information but use it to their advantage only.

“All the buyers’ data is available with just Amazon and Flipkart. Most of the time these marketplaces end up using that to their advantage. They launch products in specific categories by themselves or they have preferred sellers, so they strike a deal with them, depending on who gives them better margins and promote their products which eventually puts pressure on the margins and their business model. All of that will be changed after the ONDC,” Vembu claimed.

The e-commerce market was worth about $46 billion in 2020 and was forecast to grow at a CAGR of roughly 30% year-on-year to reach over $130 billion by 2025. Players like Amazon, Flipkart, Reliance and a few others alone command about 70% of the market in India.

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