Myntra spearheads India's move away from desktop browsing

Δημοσιεύθηκε: 15 Μαΐου 2015 - 02:06

Indian online fashion group Myntra has been a pioneer in selling apparel and accessories to young, tech-savvy consumers over the internet, as part of India's ecommerce revolution. Now the online retailer, bought last year by Flipkart, is pushing into another frontier by closing down its website.

Myntra will today shutter its website and go mobile app only - a world first - meaning that shoppers will no longer be able to make purchases from a desktop or laptop computer, but only through smartphones.

Myntra says the decision reflects the changes of internet usage in India, where smartphone ownership is increasing while penetration of broadband internet, and traditional computers, is low.

Myntra, which sells apparel from international brands such as Benetton as well as its own in-house brands, is confident that other Indian ecommerce companies will follow suit.

"We are betting on the future," says Prasad Kompalli, Myntra's head of ecommerce platforms. "We are fully committed to this eventuality that will happen to the entire industry."

The Internet and Mobile Association of India estimates that Indians spend $16bn buying goods and services over the internet each year. UBS, the investment bank, says that Indian online purchases of merchandise could be worth $50bn a year by 2020.

While there are no reliable statistics for the percentage of Indian transactions made via smartphones, surging use of the devices is seen as a crucial driver for the industry.

India has roughly 120m smartphone users, which analysts at UBS expect to more than double over the next three years, aided by the proliferation of inexpensive handsets from the likes of Micromax and China's Xiaomi. By contrast, there are only 18m broadband connections in India, accounting for a fraction of total internet access.

But many ecommerce and retail industry analysts see Myntra's decision as risky, at a time when India's ecommerce industry - and consumers' habits of online shopping - is nascent.

They warn that some of Myntra's existing and potential customers unfamiliar with the use of apps instead opt for competitors such as Jabong, which is backed by Rocket Internet, the German start-up conglomerate and Sweden's AB Kinnevik. Jabong says it has no plans to replicate Myntra's strategy.

"It is important to be flexible and give customers a choice," says Debashish Mukherjee, a retail industry analyst at AT Kearney. "There is not enough evidence to say that one platform versus another is a choice that needs to be made right now."

The tabular content relating to this article is not available to view. Apologies in advance for the inconvenience caused.

> Myntra, which shut down the smartphone version of its website six weeks ago, says that 70 per cent of its total revenues come from mobiles. Some 9m users have downloaded its app, and the company says it hopes to increase that by 5m over the next three to four months.

However, Mr Mukherjee says some customers place orders on the mobile after browsing on a traditional computer, as mobile internet connections are relatively slow in India.

"As India is still a fledgling market, giving the consumers the option to discover your site through a search engine is still a noble objective," Mr Mukherjee said.

Diptam Sarkar, a Bangalore-based digital marketing expert, says that shutting down the site can help Myntra free up resources previously spent on digital marketing for more traditional forms of advertising such as television commercials.

Shaleen Kumar, an analyst who has studied Indian ecommerce for UBS, believes the app-only strategy is an experiment by Myntra's parent Flipkart to test Indian consumers' readiness to migrate away from browser-based shopping.

The lessons learnt could be useful to Flipkart, an online retailer that sells everything from books to appliances, as it fights local rival Snapdeal and US-based Amazon for dominance of India's fast-growing ecommerce market.

Flipkart has indicated that it may follow Myntra and go app-only within a year.

"It's a Flipkart experiment on Myntra," Mr Kumar says. "There is not much to lose. It's the natural course of evolution, but the only thing is timing - whether you are timing it correctly, or whether it's too early to be app-only."

© The Financial Times Limited 2015. All rights reserved.
FT and Financial Times are trademarks of the Financial Times Ltd.
Not to be redistributed, copied or modified in any way.
Euro2day.gr is solely responsible for providing this translation and the Financial Times Limited does not accept any liability for the accuracy or quality of the translation