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Will other ecommerce players make the bold app-only move?

Bold is beautiful, this is the tagline the ecommerce giants – Myntra and Flipkart are following. Riding on the increasing smartphone penetration in India, both have decided to do away with their desktop version of the platform and embrace the app-only approach. But are the other players such as Snapdeal, Amazon, MakeMyTrip, Quikr, Jabong ready for this ‘bold move’?

Unlike Flipkart, majority of the players are seeing half of their traffic still emerge from the desktop space and stated that they will continue to maintain presence on mobile as well as desktop. Snapdeal justified its stand on maintaining desktop presence and said, “At Snapdeal, the customer is at the centre of all our initiatives. Our data shows that there are still many customers who use PCs to shop online. We do not want to force our customers to use one specific medium to shop on Snapdeal. We will continue to offer our services on both PC and mobile. We do not see this changing in the near future,” said Snapdeal. While the platform gets 75 per cent traffic from mobile but it does not want to close its website access for the remaining. Earlier also when Myntra had initiated the app-only wave in the market, Snapdeal had clarified that it is not going to neglect the traffic from desktop.

However, there are many platforms in the ecommerce space for whom close to half of the traffic comes from mobile still. Pranav Bhasin, Senior Vice President and Head of Product at MakeMyTrip.com said, “We are seeing over 45 per cent traffic via mobile across all verticals. Hotel business is witnessing 45 per cent traction on mobile, whereas the number for flights is 25 per cent. Hotels is a space where mobile and location play a big role and it is largely fuelled by last-minute hotel bookings,” Mr Bhasin added.

But the numbers from MakeMyTrip.com indicate that 55 per cent traffic is still coming from desktop, which forms a slightly larger portion of its revenues. “We have been in the business for over 15 years now and there is a significantly large consumer base that is comfortable transacting on desktop. We will continue to serve users on the channel they prefer and I do not see desktop losing relevance in the foreseeable future,” he said explaining their dedication to the desktop website.

Jabong reiterated the sentiment. “We strongly believe that customers should have the choice to buy either on the smartphone or on the computer. There are still many users who use and prefer desktop to purchase, and hence we will not devoid them of choice and flexibility,” said Praveen Sinha, Co-Founder & Managing Director at Jabong.com.

Despite its commitment to desktop, ecommerce players cannot deny the growth of smartphone penetration in India and the trend on the growth trajectory. Global ecommerce sales made via mobile devices are expected to cross USD 638 billion by 2018, according to a joint study by ASSOCHAM and Deloitte.

“Mobile is very important as it’s the tool through which most of the transactions will happen in the future. Right now we receive more than 50 per cent of our orders from mobile and the number is rapidly growing,” added Mr Sinha.

Amazon also gets good traffic from mobile which it expects to grow in the future. “Over 60 per cent traffic on Amazon.in comes through mobile phones and there is a sharp increase in customers as well as quantum of shopping on our apps. Additionally, the repeat rate of customers is very healthy indicating a good shopping experience. This is only expected to grow northwards in 2015,” said an Amazon India spokesperson.

But Amazon will still not take the app-only route right now. A spokesperson from Amazon said, “All our development and innovation is app first, and it will continue to be our flagship experience. However, as a customer-obsessed company we will enable our customers to shop anytime, anywhere and any way they want including a mobile and a desktop site.”

Nevertheless, from a the pool of ecommerce players in the market, there is one player whose numbers are vastly different from the market consensus – OLX. Since 2014, the platform has been advertising aggressively using the mobile phone as the peg for most of its brand-related conversations. Its dedicated mobile-centric campaign ‘Phone Ko Banao SELLphone’, was among the first offline ad campaigns in the industry to articulate the power and relevance of mobile apps.

“OLX receives approximately 85 per cent of its traffic from mobile. We started developing our mobile app five years ago, at a time when most players in the industry were not looking at mobile as a source of business and traffic. Our vision helped us take a lead in this space, and leverage the mobile internet boom, especially in Tier II towns, where a substantial proportion of new-to-internet population is skipping the desktop altogether to get its first exposure to internet over their mobile phones,” said Gaurav Mehta, Chief Marketing Officer of OLX South Asia.

Despite the encouraging traffic on mobile, OLX added that it does not seek to go app-only. “With 15 per cent of our traffic still coming from the desktop, we don’t think the time is opportune to go app-only. We are certainly a mobile-first company, but perhaps some time away from becoming a mobile-only company,” Mr Mehta added.

The Indian market is still away from the scenario where app-only platforms can guarantee traction for a platform. Unlike established brands like Flipkart and Myntra, which can secure traffic on app platform, emerging brands need higher visibility which only desktop can ensure. Over the next few years the dominance of mobile is expected to grow with a simultaneous dip in desktop but until such time both the media will complement the efforts of each other.

“It is not a desktop versus mobile scenario, but it is becoming a combination of both,“ according to Mr Bhasin. He said that the mobile-only era is still three years away. Mr Mehta supported the sentiment and pointed, “Mobile internet penetration needs to be higher for a robust app-only ecosystem to flourish. With approximately 200 million mobile Internet users in India right now, an app-only ecosystem might take some time to establish itself.”

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