Amazon's entry into Indian eCommerce market

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Indian online retail or eCommerce as it is better known is close to Rs 50,000 crore big industry ( Source: Assocham ). After a cat & mouse game, American online retail giant, Amazon has made a spectacular entry with junglee.com . In case you thought junglee is a new kid on the block, it was born during the google era, Amazon had acquired it in 1998, for the complete story click here

Now, what happens when a $48 billion company forays into a booming and a fiercely competitive industry? Who will benefit? Who would loose out? Will they be as successful as they were in other parts of the world? How will it change the dynamics of the industry? here’s my take.

Amazon hasn’t gone with its own name and stuck with junglee.com for a simple reason that they are testing waters before making a big splash, but I feel they should have gone with the name amazon, it’s a global brand and commands great recall value, many online shopper’s are familiar with the name amazon so, why go with some other name, that part fails to impress me.

As of now junglee.com is more of an information aggregator, allowing its users to browse several million products from several thousands of global brands. Naturally, without any doubt consumers will stand to gain the most, in terms of pricing, assortment of merchandise, customer care ( Yes! it matters even for an online retailer, in fact much more than offline retail )  and superior reliability of online transactions.  

Amazon’s entry will certainly shake up the online retail market in India, flipkart’s acquisition of letsbuy.com is a clear pointer to the future. I foresee consolidation in this space, though the online eCommerece space has huge potential for growth, the companies which were ‘ built for sell’ might rake in quick moolah and make an grand exit.

Henceforth, If junglee.com proves a  speedy enabler for offline manufacturers and small retailers to get online fast enough, that will truly be a game changer for sales & distribution channels in India, might well go on to be a piece of history in making. Amazon has already received a nod from FIPB, they are injecting about Rs 15 crore to set up a fulfilment center. It’s quite evident that Amazon is here to stay for long.

It will be interesting to see how the existing eCommerce portals would respond to the entry of Amazon. Flipkart has already made its move, looking forward to an exciting bout in the coming months.

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