Amazon Gears Up For Heavy Investment In Indian Market

Starting with its Diwali sale today, the US-based ecommerce marketplace, Amazon has announced its intentions to continue investing in the Indian market owing to its strong sales numbers and for expanding its seller base in the country.

Amazon’s senior vice president & CFO, Brian T Olsavsky, said that the company has seen quadruple sales during its pre-Diwali season as compared to last year.

“We’re really encouraged with what we are seeing, both on the customer side and the seller side. On the customer side, active customer accounts are up 230% year-over-year basis. We are in the middle of the Diwali season that is going really well. Sales are 4x what they were last year,” added Olsavsky.

In the month of October, Amazon had infused about $190 Mn (INR 1,237 Cr) into its Indian flagship firm, Amazon Seller Services to support seller capability in order to deliver value to its customers. The company strengthened its technology, especially mobile, infrastructure and logistics in order to be ready for big days of ROI.

Lately, Amazon had announced its investment in seven new Fulfilment Centres (FCs) in order to meet the growing needs of seller base. With this, the company reached out to more tier-I cities like Ahmedabad, Delhi, Kolkata, Nagpur, Gurgaon, Pune and Mumbai.

Quick Facts

Amazon has 20 fulfilment centres operating across 10 states in India
Adds 40,000 products a day
In past 11 months, Amazon has invested about $460 Mn (INR 3000 Cr).
Its number of sellers have grown more than 250% year-on-year basis

Olsavsky said that about 90% of sellers are using their logistics and warehouse services due to which they have tripled their fulfilment capacity year-over-year.

The online retail giant had announced an investment of $2 Bn to expand its operations in India last year. While in July this year, Amazon had planned to launch a $5 Bn (INR 31,700 Cr.) warchest in order to announce plethora of services for Indian consumers.

Amazon competes with the likes of Snapdeal, Flipkart, Paytm and Shopclues in the country. With the festivities round the corner, every company is trying to woo the consumers. Flipkart, the homegrown ecommerce marketplace giant, tried its new marketing stint this season by letting its CEO and other executives roll out for deliveries in town. However, Snapdeal made use of Aamir Khan’s fan following to reach out to consumers through TVCs.

Paytm on the other side has entered into new domains to make its platform alone stop destination for any ecommerce activity along with investment of $100 Mn (about INR 640 Cr.) into its “Go Big” platform to help sellers go online.

As per a research by Morgan Stanley, India’s online retail market is expected to cross $100 Bn mark by 2020, and the Indian Internet market as a whole is expected to raise $137 Bn by the same year.

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