AWS is coming to Mumbai(IN) in near future. It will make it give much better performance for us so right now investing time in GCE is difficult to justify.
Amazon is burning much more money than flipkart right now. They have invested more than flipkart's total funding and still doing quarter of Flipkart business. Flipkart on the other side is trying to reduce its loss and trying to do breakeven in few categories.
And amazon took 15-18 years to make that cash cow. Flipkart will also figure out something in next few years. For all the negativity for flipkart, they have much much bigger share in apparel which is the place where margins are higher and profitability is easier.
And amazon can not keep spending money on India. They have to convince their shareholders that investing in India will be profitable. So if flipkart being market leader will not be able to convince someone for more money, it will put pressure on amazon also for the same.
There is no doubt that India will be profitable for Amazon. They're frozen out of China because of protectionist policies, they already own the US and Europe, so if they want to grow, India has to be part of that strategy. Given that their biggest competitor in India is on its heels, I would expect them to throw more money into the country, not less.
It's not that there's absolute certainty that investing in India will be profitable -- it's just that Amazon doesn't really have any better options if they want to continue to grow.
Still they sold items of more than $100 million and thats what we are discussing. Some items were cheaper on other sites in festive season but that doesn't make it a flop. Also they didn't inflate MRP just removed discount on few items slowly and added it back on sale day.Though they did give great discounts on most of the categories and items .I don't understand what is wrong with that. They wanted people to buy items online and they were successful in doing that.
Reasons for backlash (all aren't true for every retailer & every product category, but frequently, this is what people complain about during these huge sales). The sentiment was similar yesterday across the board:
- Didn't prepare well for the rush of buyers. It was an online stampede, all day. Frequent server timeouts. Products lost from cart, technical issues due to which discounts were shown incorrectly, product cancelled after purchase was completed. These are primarily technical failures.
- Non branded items are very frequently listed at more than MRP.
- Sub-standard products (factory seconds, poorly packaged returned items, damaged boxes etc.) are sold off as new items.
- The brouhaha was not worth the time for most. E.g. snapdeal listed iPhone 5s for about $400. God knows how many pieces they had in stock. It could be 0, 5, 100. However, if they go out of stock in 5-10 seconds, they are probably hoodwinking the customers.
