Etailers in tight race for exclusive tieups with phone makers
BENGALURU:India’s biggest online retailers Flipkart and Amazon are pulling out all stops to woo top smartphone brands such as Apple, Samsung, Xiaomi and Huawei to exclusively sell their wares on their online marketplaces, as they joust for an edge during the Diwali shopping season.
Smartphones account for nearly half of gross merchandise value (GMV) for Indian e-commerce firms and is easily the most important category for top online retailers such as Flipkart and Amazon, although both companies have always downplayed their reliance on phone sales.
In fact, India’s e-commerce boom began with the sale of smartphones back in 2014, when Flipkart started exclusively selling Motorola’s Moto G phones. Since then, Flipkart’s strategy of signing up exclusives has changed the smartphone market and launching phones exclusively with either Flipkart or Amazon has become the default choice for many brands.
Under CEO Kalyan Krishnamurthy, who has been largely responsible for Flipkart’s push to return its focus on winning exclusive partnerships, the firm has set aggressive targets for Diwali season sale, and not just for its flagship five-day Big Billion Day (BBD) sale. Flipkart has set a target to double smartphone sales this Diwali against last year’s festival season sale, according to a top company executive.“During the festive season, online and offline put together, we want to ensure that at least one out of two Indians shop for their smartphones on Flipkart. Last time, we had one in three Indians shopping on Flipkart during the last festive season. This time, we want to make sure that 50% of all sales happens on Flipkart this season,” said Ayyappan R., senior director, smartphones, at Flipkart.
A key partnership Flipkart has forged ahead of BBD is with Huawei. Huawei’s Honor brand of smartphones has grown fourfold in terms of unit sales in the past year, and the firm has set an aggressive target to sell 1 million phones during the one-month long festival season sale on Flipkart. Honor has, in fact, signed a strategic partnership with Flipkart.
According to at least four executives at Flipkart and Amazon, Flipkart is the market leader and ahead of Amazon in the smartphone category in terms of both units and GMV. Amazon disputes Flipkart’s leadership in smartphone segment and says it continues to be the destination of choice for shoppers.
“In the past year, we have seen close to 1.5 times growth in the category with a selection of over 18,000 products by top brands such as Xiaomi, OnePlus, Samsung, Honor,” said Noor Patel, director, category management at Amazon India.