Amazon Enter India Case Study

1735 Words7 Pages
Introduction Amazon entered India with its core competencies - serving customer preferences, fulfilling orders and maintain low costs, but its India debut required a deviation from tried and tested methodology of delivering goods. As India is an emerging market, lower internet connectivity, growing infrastructure, logistics challenges meant that Amazon had to consider expanding channels of reaching the consumer. I will discuss Amazon’s approach to entering India and global business challenges it faced. India’s consumer segmentation and preferences are changing along with their economic development. To compete effectively against the market incumbent Flipkart, Amazon not only had to leverage its strengths (greater bargaining power with suppliers,…show more content…
Junglee aimed to pit the smaller e-commerce websites against each other and not sell products themselves. The idea sought to lure the players who were too small to compete against incumbents like Flipkart, InfiBeam and LetsBuy and would stand to get great link and advertising boost by signing up on Junglee.com (Pal, 2012) this business proposition worked out for Amazon main entry into India in two…show more content…
As a result Amazon had to change its traditional “Amazon Fulfillment” model, where it sources products from sellers and sells it to the end consumer. Its traditional model had helped Amazon to manage and control the responsiveness of the delivery mechanism and quality of products. Thus leveraging its bargaining power with sellers to drive down prices. Regulation restriction in India meant that it had to adapt marketplace model where sellers sells products to end consumers through Amazon. This meant lack of control on delivery and payment mechanism. Although a boom for small sellers (by providing unlimited virtual shelf space) Amazon is working hard to maintain its cost/price leadership through innovative payment and delivery mechanisms, customer service and diverse offerings. In order to control quality of goods and ensure timely delivery, amazon has innovatively adapted its traditional business model of “fulfillment by Amazon” to provide end to end logistics service to sellers. In the adapted version the seller still own the inventory, thus Amazon stays clear of FDI regulation violations while maintaining timely delivery of goods to end consumers (Srikant,
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