It was only two months ago that the Flipkart-owned fashion portal Myntra shut its website and started operating only via a mobile app. It was then thought that Myntra's rivals and other e-commerce companies will not be in a hurry to adopt the app-only phenomenon, but Flipkart seems to be following suit.
Flipkart is going to follow its online fashion store Myntra's footsteps and is planning to go app-only from September this year.
Various media reports said that Punit Soni, the company's chief product officer made the announcement while addressing a meeting last week, saying that Flipkart will operate only as a mobile app from September.
The Flipkart app will aim to create a personalized shopping experience, by taking stock of the user's location, preferences and purchase patterns.
The company said, "We are constantly experimenting with various aspects of our service to create the best shopping experience for our users on our app, and at Flipkart we have been following a mobile first approach."
It was only two months ago that the Flipkart-owned fashion portal Myntra shut its website and started operating only via a mobile app. It was then thought that Myntra's rivals and other e-commerce companies will not be in a hurry to adopt the app-only phenomenon, but Flipkart seems to be following suit.
However, the similarities end here.
The move, even though disruptive, made more sense for Myntra as over 90% of its sales came from mobile phones. This isn't the case with Flipkart.
The company said that currently nearly 70-75% of its sales are accounted for from the mobile application. This means that nearly a quarter of Flipkart users still prefer to use a computer for their purchases on the platform.
Myntra's sales dropped 10% after it went 'mobile only' and a similar event is expected in case of Flipkart as well. But since Flipkart's online users are nearly 25% of their total customers, the cut in sales for Flipkart is going to be deeper and might induce more pain that what Myntra suffered.
After going app-only, Myntra saw a 10% dip in sales, but the online fashion portal argued that about 95% of its traffic and 70% of its sales come from the mobile platform. The company was confident that it will make up the loss in the following weeks.
Mukesh Bansal, CEO of Myntra had then said that the company was focusing 100% on mobile users, and making all the investments on the platform, going forward.
Is Flipkart prepared for such a situation or are the two companies clear and focused in what they believe is the future of online shopping?
Myntra move two months ago was received with mixed reactions. There were many people who weren't ready to abandon shopping from their desktops.
According to Morgan Stanley's recent reports, the online shopping penetration in India is said to increase to 36% by 2020 from 9% in 2013, to be primarily led by mobile users.
According to a recent ANI report, e-tailers Flipkart, Amazon and Jabong got 50% of their revenues from consumers who shop on their mobile phones.
Flipkart acquired Myntra last year for $330 million, and Myntra had claimed that it will hit the $1 billion mark in revenue by 2016. With 45 million registered users, Flipkart plans to reach a Gross Merchandise Value of $8 billion this year.
Now the question is, will the company be able to achieve this target with only a mobile-only app?
Only time will tell.
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