Dec, 2016     

E-tailing Industry Insights from Q4 CY16


Indian market e-tailing Trends

Trend 1: Amazon is growing aggressively and has reached ~80% of
Flipkart's GMV

  • Strong growth driven by fashion category, which is again 80+% of Flipkart. Amazon expects to surpass Flipkart in this category in 6 months. Fashion growth driven by aggressive advertising, fashion show promotions and increased assortment made possible by rapid seller onboarding in this category. Private label launch planned under
    Cloudtail
  • Seller programs like Seller flex and Amazon tatkal helping drive up seller count to 110,000
  • Cloudtail share continues to be 40+%
  • Swift delivery, and consequently high customer satisfaction made possible by FBA, which accounted for 80% GMV for month

Trend 2: Players are taking multiple measures to reduce burn

  • Snapdeal fired ~15% employees across key functions
  • Flipkart is reducing seller protection fund liability on itself
  • Flipkart is changing warehousing norms to charge sellers extra for the same
  • Discounting/cashbacks cut down heavily across PayTM, Snapdeal and Flipkart

Trend 3: Fall in the Marketplace GMVs of Snapdeal

  • Snapdeal GMV fell 30% vs December
  • Caused by heavy reduction is cashbacks/discounting spend, especially in key categories like mobiles (which fell to
  • The impact of cost cutting is so severe that they have also stopped excess expenditure on the warehousing and operations which is needed for smooth functioning. For eg. Snapdeal has delayed the spending on expansion of the warehouses, thus ending up with insufficient storage space.

Trend 4: PayTM has reduced marketplace cashbacks; however it continues to invest in supply chain infra and on other verticals

  • PayTM's GMV fell 20%
  • Caused by heavy reduction is cashbacks/discounting spend
  • However, PayTM continues to invest in cashbacks for its other verticals like travel
  • Paytm also continues to invest heavily in marketplace infra- it launched multiple FCs recently (15+ now)

Trend 5: Downsizing of captive sellers likely; aggressive seller count growth is no longer a focus for Snapdeal and Flipkart

  • Flipkart is likely to shift WSR sales to a group of large 5-10 sellers to comply with new govt. norms
  • It has also reduced aggressively on-boarding new marketplace sellers, focusing on growing sales of existing sellers
  • Snapdeal is also currently not planning to increase the number of sellers, rather they are focusing on increasing the revenue contribution per seller. Their target for the current quarter is to have at least 20000 sellers who generate a revenue of at least INR 1 lac consistently for 2-3 months.

 

This document covers the keys trends of the e-tailing industry in Q4 calendar year 2016. It includes the key strategies implemented by the player in e-tailing space.

  • CATEGORIES

  • Recent Insights

    • Fintech Market Updates

      Fintech Market Updates

      P2P payments account for the largest share of India digital payments market and are currently non-monetizable; other categories are driving …[...]
    • Online Grocery Market Updates

      Online Grocery Market Updates

      India’s hyperlocal e-grocery market is growing at triple-digit rates, with sector specialists continuing to lead the market Published on: Jun …[...]
    • Food-tech Market Updates

      Food-tech Market Updates

      Non-metros rapidly acquiring a taste for food tech Published on: Jun 2019 India’s food tech expansion is no longer a …[...]
    • Online Mobility Market Updates

      Online Mobility Market Updates

      Emerging categories within online mobility space growing rapidly Published on: Jun 2019 For the longest while, India’s ride-hailing space was …[...]
    • E-tailing Market Updates

      E-tailing Market Updates

      E-Tailing market finally moves away from mobiles and electronics categories Published on: Jun 2019 The Indian e-tailing ecosystem always had …[...]
    • Change is Here to Stay

      Change is Here to Stay

      Indian mid-market hotel industry is expected to grow at 10% to reach USD 4.4Bn by 2019[...]
    • Online Retail Market Updates

      Online Retail Market Updates

      Home & Living market in India stands at ~USD 28 Bn. and is set to reach ~USD 50 Bn. in …[...]
    • Online Insurance Market Updates

      Online Insurance Market Updates

      Digital insurers are tapping multiple channels, and launching innovative new products to drive their share in the competitive Indian Insurance …[...]
    • Consumer Internet Updates

      Consumer Internet Updates

      Significant opportunity present for OTT music and video streaming players to drive user base growth in Bharat Published on: Jun …[...]
    • Digital B2B Market Updates

      Digital B2B Market Updates

      Massive opportunity in digitization of B2B procurement Published on: May 2019 The purchase of manufacturing raw materials (RMs) and MROs …[...]
    • Ed-tech Market Updates

      Ed-tech Market Updates

      The upcoming vernacular revolution in edtech Published on: May 2019 The first wave of edtech companies saw players focusing on …[...]
    • OTA/Hotel Aggregators Market Updates

      OTA/Hotel Aggregators Market Updates

      Hotel Aggregators Saw a 40% YoY Growth in GBV Terms During Q1CY19 Published on: Apr 2019 In Q1CY19, leading hotel …[...]
    • Childcare Market Updates

      Childcare Market Updates

      Online Childcare: Convenience and Product Quality drive purchase decisions; Lead time and Return experience needs to improve Published on: Apr …[...]
    • Online Interior Design Market Updates

      Online Interior Design Market Updates

      Customization and Lead qualification key to scalability in the Online Interior Design market Published on: Apr 2019 Online Interior Design …[...]
    • Online Retail Insights | Middle-East

      Online Retail Insights | Middle-East

      Online shoppers in MENA are making 15-20% of shopping through online channels Published on: Apr 2019 RedSeer estimates the e-tail …[...]