The article discusses Amazon’s struggles in the Indian market. Despite investing heavily in the country, Amazon has failed to gain significant traction and is still lossmaking. The article highlights several reasons for this failure:
- Prioritization of cloud business: Under the leadership of CEO Andy Jassy, Amazon appears to be prioritizing its cloud business (AWS) over e-commerce operations.
- Slow merchant adoption: Amazon has struggled with slow merchant adoption in India, despite investing hundreds of millions into that strategy.
- Stringent regulations: The Indian government’s stringent restrictions on how e-commerce firms operate have forced Amazon to rework its business model and limit its growth potential.
- Regulatory setbacks: Amazon lost a high-profile battle to acquire Future Group, which was India’s second-largest retail chain at the time.
- Lack of strategic execution: An analyst notes that founders such as Deepinder Goyal (Zomato), Aadit Deshpande (Zepto), and Vidit Aatrey (Meesho) have out-executed Amazon’s management team.
Amazon’s efforts to expand in India include:
- Amazon Fresh: The company is trying to serve more customers within two to three hours.
- QVC-style shopping experience: Amazon launched a QVC-style shopping experience on its app last year.
- Mobile payments: Amazon continues to invest in its mobile payments product, Amazon Pay.
However, an analyst expresses skepticism about Amazon’s ability to bounce back, citing the company’s significant investments in supply-chain systems that cannot be easily adapted to meet changing consumer habits.
Amazon’s response to these claims was to say that their data and external reports show that Amazon.in is India’s "most trusted online shopping destination." However, they also claimed that some of the information shared by TechCrunch was factually incorrect.