Mobile shopping booms in India

Warc, 30 May 2014

NEW DELHI: Mobile shopping is growing fast in India, with one leading online retailer expecting its share of revenues via this route to double in two years.

During the last financial year online fashion retailer Myntra, recently acquired by FlipKart, derived 30% of its revenue from mobile sales. "We expect it to account for over 50% of our revenues by end of this fiscal and about 60-70% by 2015-16 fiscal," Shamik Sharma, chief product & technology officer, told the Business Standard.

He added that studies conducted by the firm indicated that smartphones would become the preferred mode of shopping online over the next 12-18 months.

Accordingly, the company is increasing its focus on mobile, launching a shopping app for Android phones that will soon be followed by versions for iOS and Windows. Besides the app, Sharma said Myntra also gives incentives to shoppers to purchase products from its site using mobiles.

India is currently one of the world's fastest growing smartphone markets, fuelled by the dominance of sub Rs 15,000 smartphones.

Kushal Sanghvi, business head at Reliance Entertainment & Digital, recently told the I-COM 2014 conference in Seville that there was, justifiably, huge excitement about the take-up of mobile phone services in India, with thousands of new mobile subscribers signing up for the first time every day, spurred on by the falling cost of handsets and air-time tariffs.

But he advised that a focus by marketers on the higher-earning consumers who owned smartphones was to miss the bigger picture. Reliance was "extremely bullish" about consumers in lower tier cities. (For more, read Warc's report: Why low-income earners with cheap, basic mobiles may be the most promising long-term prospects in India.)

"Someone who's got a very low-end handset, this is where the growth is going to come from," he stated. "It's massive, massive, massive. We're talking about college students and younger people who are using mobile for the first time, often with just a feature phone."

Already, he said, these consumers were getting used to spending small amounts on e-commerce done via mobile.

Data sourced from Business Standard; additional content by Warc staff