Amazon Prepping Up For Budget-Friendly, Unbranded Fashion Route To Take On Meesho

Ecommerce major Amazon is reportedly gearing up to launch its new vertical, Bazaar, showcasing budget-friendly, unbranded fashion and lifestyle products. 

As per ET’s report, Amazon Bazaar is currently onboarding sellers and encouraging them to list unbranded products, which include apparel, watches, shoes, jewellery and luggage, all priced below INR 600. 

The company is aggressively looking to woo Indian value customers, as demand for mass-market products tapers and its growth loses pace, the report said, citing sources close to the matter.

“Bazaar is a new store on Amazon where you can sell your fashion and lifestyle products online at no extra charges, thus making it more profitable to run your business,” as per a document revealed by ET.  

The delivery timelines for Amazon Bazaar products are expected to be two to three days, differing from its usual fast delivery for Prime members. “Consumer cohorts at the lower end of the market typically do not prioritise faster deliveries… They (Amazon India) have lost out on the segment so far and essentially want to tap the typical Meesho customer,” the report said.

The space has been tapped by Meesho, backed by SoftBank, and Flipkart’s Shopsy (via a separate app). Reliance Industries, led by Mukesh Ambani, is also developing a low-price platform, Ajio Street.

Amazon is suggesting a zero referral fee for merchants, particularly crucial for products with a low average selling price (ASP). Meesho, with an ASP of Rs 300-350, operates on a zero-commission model while generating revenue through advertising and providing logistics services to sellers.

It is pertinent to note that Meesho, unlike e-commerce giants Amazon and Flipkart, doesn’t own and operate warehouses and logistics.

The latest development comes close on the heels of Amazon’s entry into the logistics business in India, introducing a new vertical called Amazon Shipping. The company is set to debut in this space by handling non-Amazon orders. Amazon has initiated collaborations with direct-to-consumer (D2C) brands, logistics aggregators, and other businesses that directly receive orders from consumers to kickstart this new venture

This comes at a time when Amazon Seller Services, the marketplace business of Amazon India, has received INR 830 Cr from its US parent. As part of this fund infusion, the company allotted 830 Mn equity shares to Amazon Corporate Holdings Ltd and Amazon.com.inc. 

This investment follows a previous INR 350 Cr investment in its fintech unit, Amazon Pay, on January 19, bringing Amazon’s total investment in its Indian entities to over INR 1,000 Cr this year.