A lot of digital ink has been spilled about Indian e-commerce in the last year, and this week has gotten the Interwebs in a positive lather about the potential for massive online sales in India, as it relates to Big Companies here at home. True, only about 34.8% of the population has Internet access, but that’s 1.327 billion people.

2016: An Indian E-Commerce Snapshot

37% market share – Flipkart (India-based)

21-24% market share – Amazon

14-15% market share – Snapdeal (India-based)

This isn’t a short-term, low-stakes game, and whoever wants to capitalize on the sheer size of the Indian e-commerce market is going to need very deep pockets and a lot of patience to add the jewel that is India to their crown. Industry analysts estimate that by 2030, the size of the Indian e-commerce market will be roughly 10 times what it is today ($228 billion), but there is a long way to go between here and there.

One of the main issues that e-tailers struggle with in India is that cash is still king. So even if consumers have Internet access, how can online retailers collect payment? In a country with over 1.3 billion people, 900 million mobile phones and 700 million bank accounts, only 21 million credit cards were held in India during the period 2014-15. Thepeak number of cards issued was around 27.5 million, before the global financial crisis. In order to get to 2030, those companies interested in making online sales had better figure out some sort of “boots on the ground” approach to payment and package pickup in the interim, too.

So, who’s in the mix?

As of Yesterday, Walmart

In some respects, Walmart – in pursuing Flipkart as an acquisition – is very well suited to the tasks of being well-funded and patient. E-commerce seems to be a newfound priority for Walmart: they have recently purchased Jet.com in a bid to compete more directly with Amazon in the US, and if the number of ads I see on TV are any indication, Wayfair.com is going strong, too. Flipkart is an enticing prospect at the moment, having gone through two devaluations and some controversy in 2016.

However, Walmart recently sold their Chinese operation to a local competitor, JD.com, and their history in India hasn’t been entirely untroubled. In 2007 Walmart formed a joint venture with Bharti Enterprises to run wholesale stores in a preparatory move to open retail stores, only to dissolve the partnership in 2013 and take control of the 21 wholesale outlets. The retail stores never materialized.


Or Amaze-on,* as my nephew with an auditory processing challenge says (which reminds me, why isn’t he the CMO at Amazon, since it’s right there, on the box?!?). So, yeah, Amazon is kind of interested in India. In 2016, they were the only major online retailer in India that gained market share.

With Amazon’s renowned deep-dive analytics and curated shopping expertise, industry analysts expect Amazon to be the most nimble of foreign competitors eyeing the prize. They have proven to be willing to adapt to changing customer preferences and create innovation through an institutional commitment to planning, infrastructure and logistics.Harvard Business Review concurs, noting that Amazon has recruited mom-and-pop stores to be part of its distribution network, attempting to counteract some of the delivery and payment hurdles I’ve outlined above, among other things.

….And Don’t Count Alibaba Out

Alibaba is investing in Indian acquisitions to cement their position in the market –Forbes notes that they are already busily at work, in talks with Shopclues, India’s online flea market valued at $1 billion, selling unbranded products to value shoppers. They have a stake in Snapdeal, which bills itself as India’s fastest online shopping destination. Alibaba also holds a 40% stake in Indian online payments company Paytm, which also has a small e-commerce arm (you can order India’s first lithium-ion bike there, for example), and is India’s largest mobile wallet provider with 140 million+ users.

* This is an awesome turn of phrase we’ve been using since my nephew was 7. He’s 9 years old now – and deserves the credit/his cut of whatever ad revenue it generates, should you decide to use it. Just saying.