SUMMARY
In A Letter To Shareholders, Jeff Bezos Also Touted Amazon As Fastest Growing Marketplace In India
In its latest Annual Shareholder letter, Amazon Inc. founder Jeff Bezos has claimed that its paid subscription service, Prime, added more members in India in its first year than any previous geography in the company’s history. Prime selection in India now includes more than 40 Mn local products from third-party sellers.
At the same time, Prime Video is investing in original video content in a big way, including two recent premiers and over a dozen new shows in production.
“We’ve expanded our slate of programming across the globe, launching new seasons of Bosch And Sneaky Pete from the U.S., The Grand Tour from the U.K., And You Are Wanted from Germany, while adding new Sentosha shows from Japan, along With Breathe and the award-winning Inside Edge from India,” as stated in the shareholder letter.
He also termed Amazon India as one of the fastest growing marketplaces and the most visited site. on both desktop and mobile,in the country, citing data from comScore and SimilarWeb.
The statements came in line with the ecommerce giant’s recent product launches including Alexa, and Amazon Echo as well as the growing adoption of Amazon in different verticals such as food retail, ecommerce and digital payments in India.
In his letter, Jeff Bezos further claimed, “Amazon India’s mobile shopping app was also the most downloaded shopping app in India in 2017, according to App Annie.”
The shareholders’ letter also quoted the American Customer Satisfaction Index which recently announced the results of its annual survey, according to which for the eighth year in a row, customers ranked Amazon #1.
The Push On Amazon Prime And Amazon Prime Video In India
Amazon originally launched its paid subscription programme, Amazon Prime, in India back in July 2016. In the years since then, it has expanded Amazon Prime to include a number of different verticals, such as online music streaming as well as online video streaming. It was in December 2016 that the ecommerce behemoth announced the launch of Amazon Prime Video, nearly a year after global rival Netflix entered the Indian market. The service provides its customers with exclusive access to movies, Amazon’s original series along with premium content beyond borders.
Most recently, in February 2018, the company finally rolled out its music streaming service – Amazon Prime Music – in the country. At present, India is said to have around 60 Mn online music service users. An ad-free music streaming service exclusively for Prime members, Amazon Prime Music features voice control with Alexa. Amazon Prime Music currently showcases songs in over 10 languages including English, Hindi, Tamil, Punjabi, Bengali, Kannada, Telugu and more.
Over the past year, Amazon India has inked several partnerships with Indian music brands like T-Series, Saregama, Zee Music and more to build localised content for the Indian users. In India, Amazon Prime Music compete with music streaming services like Times Internet’s Gaana, Saavn, Hungama, Reliance Jio’s Music, Airtel’s Wynk, Google’s Play Music etc.
Along with Amazon Prime Music service, Amazon also introduced its video streaming device, Amazon Fire TV Stick in April 2017, against rival Google Chromecast. Later in October 2017, Amazon’s AI enabled virtual assistant Alexa-powered wireless voice-controlled speaker, Echo, entered the Indian market for select customers.
Among the other awaited products from Amazon India is its audiobook and entertainment service, Audible.
The Ongoing Battle In The Indian Ecommerce
Amazon is also going aggressive in its battle with rival and the homegrown ecommerce unicorn Flipkart. Most recently, amidst the Walmart-Flipkart deal talks, Amazon also pushed its rival offer as well as offered a $1 Bn-$2 Bn breakup fee to Flipkart.
A report by FactorDaily quoted a source as stating, “Amazon is keen on the deal and the breakup fee can be anything north of $1 Bn in a deal where Flipkart is valued at $18 Bn-$20 Bn.”
The acquisition of Flipkart will not only give Amazon an edge in Indian ecommerce, but will further allow the company to penetrate in its other verticals.
Amazon, for instance, has already entered the food retail segment in India. The company started its pilot project in Pune, while also expanding its hyperlocal services arm Amazon Now in February. Reports suggested that Amazon will now sell locally made and packaged food to the consumers directly and will compete with other leading online grocery and food retail marketplaces like Grofers, Bigbasket, Supr Daily, who received similar approvals from the government for food retailing.
It is also boosting its presence in other verticals in the country with products such as Amazon Pay, Amazon Prime, and Amazon Pantry, among others.
India’s ecommerce industry is expected to touch $200 Bn by 2026, as per a report by Morgan Stanley. The market reached $33 Bn registering a 19.1% growth in 2016-2017, as per Indian government’s Economic Survey 2018.
While the shareholder letter certainly shows Jeff Bezos’ optimism on the Indian market, it is all a fact that Walmart is considered as the prime contender for Flipkart, and the road will become more bumpy for Amazon if the deal goes through. However, Amazon’s bet on technology and Prime in India is expected to take off well, opening equal opportunities for both the foreign entities in the Indian landscape.
