Written By PEERZADA ABRAR

The government’s move, tightening norms for online retailers such as Amazon and Flipkart, is seen as a strategy to give large and small local retailers and traders in the country a leg up, ahead of the general elections scheduled for 2019.

The norms, which are seen as helping protect domestic players, would not only help online marketplace players such as Snapdeal, and Paytm Mall but also large local companies such as Reliance that are eyeing a share of the e-commerce market in the country, according to industry watchers.

“There is a realisation in the government that after demonetisation and GST [Goods and Services Tax], they needed to give something to the traders,” said an industry expert who did not wish to be quoted.

‘Intense lobbying’

Another expert said a lot of lobbying was being done by large local retailers against big e-commerce companies in the country. “Those are the ones which are going to gain from this,” said the expert also not wishing to be quoted.

Devangshu Dutta, CEO of retail consultancy Third Eyesight, said with the general elections coming up, the government could not have ignored the demands of domestic retailers. “This includes red flags highlighting that e-commerce players have grown on the back of aggressive discounting. It is the job of any democratically elected government anywhere in the world to look at domestic interests first,” he said.

Source: thehindu

Ashwini Phadnis As a special tribute to the Father of the Nation on his 150th birth anniversary, Air India will paint images of Mahatma Gandhi on its aircraft.

This is part of the two-year- long celebrations planned by the government; they will end on October 2, 2020.

Source: thehindubusinessline

Written By Sagar Malviya & Writankar Mukherjee, ET Bureau

MUMBAI | KOLKATA: Amazon India’s largest seller Cloudtail crossed the Rs 5,000 crore sales mark in the year to March but growth tapered off significantly, indicating its fading role as the company seeks to comply with foreign direct investment (FDI) rules on marketplaces.

The government said last year that it will not permit a single vendor to account for more than 25% of sales on an online marketplace that has overseas investment.

Cloudtail, a joint venture between Amazon Asia and Infosys founder Narayan Murthy’s personal investment vehicle Catamaran, posted over a 24% jump in revenue to Rs 5,688.7 crore in FY17, according to its annual return.

That’s against a 300% surge to Rs 4,586.9 crore in the previous year when it accounted for over a third of the sales on Amazon’s shopping platform in India.

“With the restriction, it was very clear that growth had to be moderated. But Amazon would still prefer to channel their goods through a seller where they can control margins and inventory,” said Devangshu Datta, CEO, Third Eyesight, a consultancy firm. Amazon India declined to comment. Cloudtail didn’t respond to an email.

Cloudtail’s numbers pale in comparison with Flipkart’s biggest seller WS Retail, which posted sales of Rs 13,921 crore for the year ended March 2016. It hasn’t filed a financial performance report for the last fiscal yet but Flipkart has also been reducing its dependence on the seller, in which its founders used to own a stake.

After the government’s guideline, which ecommerce companies had to comply with by March 31, 2017, Cloudtail almost stopped selling mobile phones a year ago but continued with Amazon private labels in India. Smartphones constitute the largest category of India’s ecommerce sales and formed a big part of Cloudtail’s overall sales in previous years.

“With the smaller pace of growth by exiting smartphones, Cloudtail will surely comply with the FDI norms of one seller accounting for 25% of total transactions at Amazon last fiscal itself,” an executive said.

Another seller said Cloudtail’s gaze is on consumables such as FMCG, nutrition, apparel and televisions, which are the next focus areas for Amazon. Personal care, baby care and nutrition are also of interest. It currently sells Amazon exclusive television brands like TCL, Sanyo and BPL.

Source: economictimes

The numbers were 27 percent higher compared to the sales last year with $24 billion of gross merchandise value (GMV)

Written By SABAHAT CONTRACTOR

Chinese e-commerce giant Alibaba sold a record $30.8 billion worth of products on its 24-hour Singles’ Day sale.

The numbers were 27 percent higher as compared to the $24 billion of gross merchandise value (GMV) of sales last year.

Even though China is facing major geopolitical and economic challenges, the story on Chinese middle-class consumption on November 12 was different altogether.

Last month, India also had one of its biggest online shopping festivals, but reported a fraction of this number at $2.3 billion during five-day period.

What got Alibaba to achieve the $30.8 billion GMV target in 24 hours is the trust placed by the Chinese consumers, the consolidation of online and offline retail, the categories of products, the income and expense of the Chinese consumers and others, according to the analysts.

While we can say that both China and India have almost the same population size, it will not be appropriate to compare the size of online e-commerce market of China and India.

“China’s online e-commerce market was between $900 billion to 1 trillion in 2017 whereas India’s e-commerce market was around $18-20 billion. There is a significant difference in size of the market in both countries,” said Ankur Pahwa, Partner and National leader, E-commerce and Consumer Internet, EY.

Income and consumption power plays an important role for a consumer. “The economies of China played an important role in the spending habits of the Chinese. The GDP per person in China is around $9000 whereas in India, it is around $2000,” said Pahwa.

Devangshu Dutta, Chief Executive of Third Eyesight said, “I don’t think that Indian and China can be compared at par. There is a huge difference in their income and consumption profiles.”

But what lessons should other e-commerce platform learn from Alibaba?

Trust plays a very important role in an online e-commerce market. Alibaba, with its closed ecosystem, has developed trust with its consumers. Indian e-commerce still lags behind on this factor.

“Quality and trust played a very important role for Alibaba in China. Also, a large part of the Chinese economy is virtual. Whereas in India, a majority of buying is still from offline,” said an analyst.

Alibaba said that more than 40 percent of consumers made purchased from international brands

. “Indian e-commerce should give a mix of categories to its consumers. Proper curation of the inventory should be there in order to target Tier 2-3 cities. Another lesson one can learn from Alibaba is the dealings with the brands,” said analyst.

Alipay plays an important role for Alibaba. “Alibaba has integrated all ecosystems in its e-commerce business. From Alipay to its logistics. It has provided qualitative and seamless experience for its consumers,” said an analyst.

Online and Offline markets

Dutta added, “Alibaba has consolidated its hold on both the business and the consumer side in the Chinese ecosystem. India still has a fragmented consumer market, and online retail is only a couple of percentages of the total market, though the supply side is consolidated between the two foreign-owned businesses, Flipkart Group and Amazon. In India, I think both online and offline formats need to evolve together.”

Source: moneycontrol

Written By Shambhavi Anand, ET Bureau

New Delhi: Chinese fashion firms are joining the Diwali party this year. Shein, Romwe and ClubFactory—which figure among the top 10 most downloaded apps, according to app tracking firm App Annie — plan to roll out mega offers to take on the likes of Myntra, Jabong, Ajio and others during the upcoming festive season.

ClubFactory, which recently roped in Ranveer Singh and Manushi Chhillar as brand ambassadors, has planned its biggest sale of the year called the ‘Club Diwali Sale’ during October 10-14. Apart from three flash sales per day, all those placing orders during this period will get a chance to win a free iPhone daily. According to App Annie, ClubFactory was the highest downloaded app in the shopping category in July. Shein, which recently completed one year of operations in India and has crossed 5 million downloads, will offer discounts as well as free shipping during the festive period.

Source: economictimes