It seems India’s biggest eCommerce firms have already begun some pre-Diwali crackering amongst them. In a rather unusual development, Snapdeal and Flipkart have engaged themselves in a battle of words to assert their supremacy over one another.
If you’d remember, Snapdeal CEO, Kunal Bahl had claimed in an interview with Economic Times, that his firm — which is currently valued at a third of Flipkart and has a GMV which is less than half of its bigger rival — will displace Flipkart as the number 1 e-commerce company by fiscal 2016.
Flipkart, which usually is pretty quite when it comes to such statements and speculations, has now reacted strongly to Bahl’s comments. Mukesh Bansal, who heads Commerce division at Flipkart has retaliated by declaring to achieve a target of $10 billion or 65000 crore worth GMV or total sales value which he believes nobody would be able to compete.
Nobody will be even half of that. There is not a shred of doubt based on all the market numbers we have today.
remarked Mukesh in an interview given to the ET.
He also replied to Bahl’s comment which questioned the sensibility of making Myntra app-only calling it the most customer unfriendly idea ever. Bansal said that the revenue of Myntra was higher than the time when it was web-based and the time spent on app had gone up by 50% with Myntra’s estimated GMV at about $500 million. Experts though, have continued to express doubts over those numbers.
He further added that Flipkart plans to sell goods worth $100 billion in 5-7 years and would grab a market share of more than 70% by that time.
One can definitely see a tough competition in the Indian eCommerce space not only between Flipkart and Snapdeal but also among other players like Amazon India and PayTm, which could in fact prove to be an underdog in the battle of established giants having recently secured $600 million from the Alibaba group.
Alibaba on the other hand, is playing a game of its own, by investing in two of the fastest growing ecommerce brands in the company – earlier in PayTM and later in Snapdeal.
Amazon India too has plans to invest $5 billion in the Indian market to turn it into its biggest market after the US. On the other hand, Snapdeal also recently secured $500 million from Foxconn , Alibaba and Softbank group, which was less than the $700 million funding received by Flipkart from Tiger Global and Steadview Capital .
In terms of market share, a Morgan Stanley report suggests, that Flipkart currently commands 44% market share followed by 32% and 15% market shares by Snapdeal and Amazon India respectively. However, Snapdeal with over 2 lakh sellers on its website is the largest marketplace of India in terms of the number of merchants.
However, one would have to wait and watch for the final verdict of this eCommerce battle which has probably just begun and with Diwali only a couple of months away, we may expect to see more such crackers in the coming months in the meantime.