Walmart's Flipkart keeps its throne during Diwali sales, outperforming Amazon an...

Walmart's Flipkart keeps its throne during Diwali sales, outperforming Amazon and other players

Walmart's Flipkart keeps its throne during Diwali sales, outperforming Amazon and other players

Zijing Fu

posted on 6 hours agoEditor : Wang Boyuan

Flipkart and Amazon India's race will continue to be a neck-and-neck one.

Similar to North America's Black Friday and China's Double 11, India has its own end-of-year sales — the Diwali festival. Diwali, or Deepavali, is a festival of lights popular among Hindus, Jains, Sikhs, and some Buddhists. As families prepared for the festival, their shopping interest fueled the growth of Diwali as a retail festival. This year, most of them have turned to Flipkart for online shopping.

According to a recent Economic Times report, The Flipkart Group bagged a market share of around 60% during this year's Diwali sales, citing data from PGA Labs. Meanwhile, Amazon India accounted for 32% of total sales.

Ever since its foundation in 2007, Bangalore-based Flipkart has been a prominent player in India's e-commerce scene, competing with Amazon's India subsidiary and local rival Snapdeal, which focuses on low-tier markets. Flipkart initially focused on bookselling, acquiring companies like the digital distribution business Mime360.com and social book discovery service WeRead along the way. The company later pivoted to all-genres retail, as it purchased Myntra, an online fashion retailer, in 2014 and bought eBay.in, eBay's India subsidiary in 2017.

In 2018, US retail chain Walmart and e-commerce giant Amazon entered into a bidding war over Flipkart, both eyeing the potential of India's then newly developed online retail market. Walmart eventually won, purchasing a 77% controlling stake in Flipkart for $16 billion.

Now, what Amazon failed to acquire is haunting it as the strongest competitor in the region. Both Amazon and Flipkart started preheating for the Diwali sales as early as late September and have been neck and neck in terms of reacting to each other's promotions. Previously, Flipkart's Big Billion Day sale was scheduled to start on October 7. As Amazon India announced its Great Indian festival would start on October 4, Flipkart advanced its date to October 3, one-uping Amazon. A day later, Amazon changed its date to October 3 as well, saying the deals would run for a month, with early access for Amazon Prime members.

Flipkart and Amazon India also tried to outdo each other even when it came to names for deals. For example, both platforms promised big discounts on Apple products. Amazon calls them "crazy deals," while Flipkart has called them "craziest-ever" deals.

Flipkart eventually prevailed with a 60% market share, yet it suffered a slight dip from 65% last year. Meanwhile, Amazon India's market share rose rapidly from 25% last year to 32% this year, making Amazon India a strong opponent considering other players, such as Snapdeal and Meeshoo, only occupied 8% of the market share when combined.

Also, according to a KrAsia report, Amazon India's GMV is expected to reach $15billion in 2021 and $18 billion in 2022. In comparison, Flipkart's GMV — $18billion in 2021 and $22 billion in 2022 — does not draw that big a gap like the Diwali market share.

"The 2021 festive season sales continued to show an uptick in terms of e-commerce sales," said Abhishek Maiti, director of competitive intelligence and consumer insights at PGA Labs, "We expect e-commerce sales to climb a further 25%, to USD 75 billion in FY 2023 from USD 48 billion in FY2021, with growth in digital buyers."

It is expected that Flipkart and Amazon India's race will continue to be a neck-and-neck one. Other players such as Snapdeal, India's third-biggest online shopping platform, will also be trying to cut a slice of the cake, as India's e-commerce's next biggest growth driver lies in second plus tier regions and low priced goods.

"Value is an enduring concept in India, as in most other parts of the world," says Manoj Kohli, country head of SoftBank.

According to market research by Bain & Company, 80% of the new customers who came online last year were from smaller Indian towns.

Snapdeal would arguably have an edge in such a market, as it started off in 2010 as a daily deals and coupons platform, occupying a key spot in the non-branded retail space and accumulating over 200 million listings and over 27 million unique buyers.

"This market(value eCommerce) is three times larger than the size of the branded goods market—that had been the primary focus of the eCommerce industry till 2016-17," according to Forbes citing Kunal Bahl, co-founder of Snapdeal.