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Guess what’s the Prime mover of Amazon’s plans to win the India race

15 June, 2017

It’s not even a year-old in India, but Amazon Prime, the e-commerce behemoth’s subscription service that includes faster deliveries and video streaming of international and Indian content, seems to be bringing the company rich dividends.

Not only do Prime members account for one out of three orders placed on the site, but the subscription service has also helped the e-tailer steal a march on rival Flipkart, Amazon India head Amit Aggarwal claimed in a recent interaction with several media publications.

Aggarwal also said that Amazon was working on a new digital payments service, although he didn’t divulge details about its final form.

Here are some key takeaways regarding Amazon’s growth numbers and traction, based on Aggarwal’s interaction.

1) Amazon India claims to have registered unit sales growth of 85% in the first quarter of 2017, with overall gross merchandise sale (GMS) value rising 68%. In comparison, Flipkart claimed to have clocked 45% growth in gross merchandise value (GMV) in March.

2) Amazon Prime’s membership base, which has doubled since the beginning of the year, accounts for close to 30% of all orders for the e-tailer. Around 50% of orders shipped on Prime are from Tier 2 and Tier 3 cities.

3) The total spend by Prime members during Amazon’s sale event in May rose 100% over the event in January. Buoyed by this, Amazon has set aside $100-125 million for original programming and content acquisition this financial year, The Economic Times said. Amazon’s maiden original content programme is set to debut this week.

4) Amazon is gearing up to launch a new digital payments service that will be broader in scope than Pay Balance, and won’t be limited to Amazon-based transactions. The e-commerce major recently obtained a pre-paid payment instrument licence to launch its own wallet service.

5) The world’s biggest e-tailer will continue to spend heavily on infrastructure and technology in India as it looks to tap its next 100 million users. In terms of infrastructure, Amazon has so far set up 41 fulfilment centres in India covering 13 million cubic feet.

6) Amazon burns almost $80 million every month in its fight to surge ahead in the competitive Indian e-commerce space, according to a report in The Times of India. Flipkart, however, was reportedly burning $45 million every month in mid-2016.

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Guess what’s the Prime mover of Amazon’s plans to win the India race

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