MUMBAI: eBay India, one of the earliest online
marketplaces in the country, has slipped behind both Flipkart and Amazon on
revenues from seller commissions as its two rivals along with Snapdeal have
been aggressively pushing sales with big discounting events and high-decibel
marketing.
eBay India posted revenues or income of Rs 107
crore calculated on commission earned from sellers along with advertising
revenues for fiscal 2013-14, according to its annual filing to the Registrar of
companies.
In comparison, Amazon Seller Services posted
revenues of Rs 169 crore and Flipkart Internet that manages the portal reported
income of Rs 179 crore. A year earlier, eBay's revenue was Rs 81 crore while
Flipkart trailed with Rs 15.4 crore.
These numbers are not sales from actual goods
sold on their portals but are transaction and listing fees from the sellers as
well as advertising revenue which is the actual revenue of e- commerce sites.
eBay declined to comment on its financials.
While eBay and Amazon don't disclose income
from merchandise sales, Flipkart India, the website's wholesale arm, said sales
more than doubled to Rs 2,846 crore in the year ended March 2014, against Rs
1,180 crore in the previous year.
Experts feel that the aggressive strategy of
Flipkart, Snapdeal and Amazon has affected most others including eBay.
"These three companies are playing a game
for market dominance and their aggressive stance has taken options away from
rivals," said Devangshu Dutta, CEO at retail consultancy Third Eyesight.
"These Indian players (Flipkart and
Snapdeal) are funded well to continue that strategy while Amazon seems to have
clearly seen a huge opportunity in India," he added.
In July, Amazon announced it would invest $2
billion (approx Rs 12,400 crore) in the company's India operations that have
exceeded gross merchandise sales of more than $1 billion within a year of the
launch.
San Jose-based eBay bought local auction
platform baazee.com for $55 million (about 344 crore) to enter India back in
2004, at a time when online retail was unheard of in most of the country.
The Indian e-commerce industry picked up in a
big way in the last couple of years, triggered by deep discounting strategy
from newer players even if that meant incurring heavy losses.
Soaring sales and rising losses bear witness
to this. Combined losses of Bangalorebased Flipkart, Delhi-based Snapdeal and
Amazon India was more than Rs 985 crore for the last fiscal. Flipkart and
Snapdeal — which counts eBay, Azim Premji and Ratan Tata as investors —
together sold goods worth more than $4 billion. eBay India has been mostly
lying low and hasn't been actively participating in recent mega sale events.
Yet, the company has posted Rs 83 crore net loss during year to March 2014, a 15%
increase from a year ago period.
Frequent change in its leadership team may
have also affected eBay. Its current managing director Latif Nathani is its
fourth India head in the past five years.
Parent company eBay Inc is trying to sort out
issues in its home market by spinning off its PayPal unit into a separate
business in an attempt to negate the slowing growth of traditional marketplace
business.
Experts, however, aren't discounting eBay
India yet and feel the Indian online retail market, which is estimated to grow
over four-fold to touch $14.5 billion (over Rs 88,000 crore) by 2018 can absorb
a handful of large players including eBay.
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