Amazon takes the 'prime' spot in metros while Flipkart rules small cities

Flipkart and arch rival Amazon India are still going neck to neck in the Indian e-commerce battle and scored the same number in the latest RedSeer E-tailing Leadership Index (ELI).

While Amazon has edged past Flipkart in metros on popularity and brand recall in the quarter ended June, Flipkart continues to rule over non-metros. The study attributes Amazon’s success to its Prime programme, which bundles delivery and shopping privileges with unlimited access to video content.

“Amazon has outperformed Flipkart on the web and app experience for the first time,” said the survey based on responses of 4,500 online shoppers in 30 cities.

While the rivals have emerged as the joint leaders on RedSeer’s leadership index, what's important to note is that Amazon India is increasing its score at a much faster rate than Flipkart, indicating that unless Flipkart improves its delivery speed, browsing experience, brand image and other aspects, it will soon be overtaken by Amazon India as the country’s most popular shopping platform.

“Flipkart remained constant on the scorecard with only brand recall seeing a slight improvement in comparison to the last quarter,” said the report.

Amazon has been investing aggressively in India. Adding on to its earlier commitment of $5 billion, the Jeff Bezos-led firm pumped in another $260 million in its Indian arm in June to expand business. Though Flipkart too can now boast of a bigger war-chest courtesy $2.5 billion investment from SoftBank, it has it work cut out for the future. Besides the brand trust, some other metrics on which Flipkart still maintains a lead over Amazon include price competitiveness, checkout gross merchandise value, revenue from product sales, and contribution margin.

The Indian e-tailer has also managed to keep its marketing expenses down and has brought down spending by nearly two-thirds, as compared to the beginning of the 2016 calendar year, when the first version of ELI was published.