New e Commerce Policy in India - Will Amazon and Flipkart Survive?
The new e Commerce Policy has been enforced in India on February 1, 2019. As expected, the big boys of the e-commerce have been seriously affected and now we've the news that Walmart, which invested billions of dollars into Flipkart is now likely to exit. The news is that Walmart sees no future for long-term profitability for Indian ecommerce startups.
For once, I think the new ecommerce policy creates a level-playing field for all the players. Under the new policy -
- eCommerce companies will have to protect the User Data and cannot sell it to third parties for any reason.
- E-commerce marketplaces cannot influence the prices of the goods being sold. They will now have to sell products at par with prices offered by offline traders.
- There's a limit on products sold that aren't manufactured in India.
- Discounts are now regulated.
Both Flipkart and Amazon gained popularity in India through discounted pricing. Books and several other products were deeply discounted on these portals and therefore both portals saw a tremendous response from consumers.
Unfortunately, the new policy will now restrict these big ecommerce players from offering discounts.
The big companies like Amazon and Flipkart have grown mostly because of discounted goods; and ease of convenience. I wonder with the new policy in place and the restrictions it brings on the inventory - do you think Flipkart and Amazon will survive?
What do you think?