Google’s e-commerce debut in India

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The war in India’s e-commerce space is expected to get intense if Google enters the market. The e-commerce space in our country is already very crowded with major players like Flipkart, Amazon and Paytm.

Already being an integral part of our lives, Google wants to leave no space untouched and plans to be the next e-commerce giant in India.

According to the recent reports, Google’s launch might coincide with Diwali this year.

Deals by Google: Opportunity analysis

Some of the groundwork has already been done by Google by setting up a large consumer base in the country. For instance, the Google Tez app already controls a significant share of the digital payments market and could possibly be integrated with the e-commerce platform. Last year Google had invested in an app called Dunzo which delivers food and groceries in Bangalore. This investment will help Google understand consumer preferences which is extremely important especially in a diverse country like India. Google had also invested in a Mumbai based fashion e-commerce startup Fynd, which could eventually help them assess consumption patterns considering fashion being one of the major verticals in online businesses.

Other investments by Google include Practo, Cue Learn, Car Dekho, Fresh desk, and Common floor. All these deals will help Google understand consumer behavior to be able to compete with giants like Amazon and Flipkart.

Google is also working with the Ministry of Railways to give high-speed internet to 400 stations and according to a report by Nielsen, more than a billion phones will be sold by the year 2030.

The e-commerce market in our country is expected to be valued at around USD 38.5 billion and projected to grow to USD 64 billion by 2020 so the opportunity is immense in this sector but at the same, it is getting extremely competitive.

Market reaction

Amazon and Flipkart used to spend tons of money to buy advertisements on Google but with the recent report of Google entering the space, the e-commerce giants have cut their ad spending on the search giant by 30% according to Mint. They are now looking at alternative sources to promote their products online.

Google’s entry and the Walmart-Flipkart merger are expected to change the landscape of the Indian e-commerce market. Google, Amazon, and Walmart already compete with each other in the US, but will now fight to get a slice of the pie in India as well. Adding to this is the Chinese threat- Alibaba backed Paytm.

None of the e-commerce companies in India make profits and some even barely break even; still, India is one of the hottest destinations for online businesses.

Will all these companies survive in such an intense competition, only time will tell. Till then the Indian consumers can sit back and relax and enjoy the heavy discounts and offers that come their way.

Author: Nitya Pahuja