Amazon overtakes Snapdeal, becomes India’s second largest online marketplace, despite Indian goverment’s e-commerce rulings

Amazon finally addressed India’s additional rules governing foreign ownership of e-commerce late last week, amidst news that the global marketplace juggernaut is now set to take the lead as India’s top online marketplace.

According to the Economic Times, former market leader Flipkart’s share of shipments fell to 37% in March from 43% in the same month in 2015, and Snapdeal’s fell to 14-15% from 19%. Amazon India’s unit market share surged to an estimated 21-24% from 14%.

Meanwhile, Amazon officials say the company will abide by the e-commerce rules in India, which prohibits any vendor on an e-commerce marketplace from comprising over 25% of the overall sales on the platform. Despite their indicated compliance, Amazon is aggressively going after the Indian market, committing $2 billion into their Indian marketplace, as CEO Jeff Bezos has repeatedly claimed.

Amazon’s spokesperson had no comment on how they would manage Cloudtail’s business in compliance with the new rules. Cloudtail is Amazon’s joint venture with Catamaran Ventures, the largest vendor to sell goods in the India marketplace platform.

Morgan Stanley estimates India’s online retail market will touch $119 billion value by 2020, making it a highly attractive opportunity for Amazon.

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Juozas "Joe" Kaziukėnas

Founder of Marketplace Pulse, Joe wears multiple hats in the management of Marketplace Pulse, including writing most of the articles. Based in New York City. Advisor to other startups and entrepreneurs. Occasional speaker at conferences.

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