App today, gone tomorrow: Lessons from Indian ecommerce

Many of the Indian ecommerce biggies are eschewing apps and refocusing on browser-based sites. Here's why.
Written by Rajiv Rao, Contributing Writer

What may appear to be an act of strategic lunacy in the tech firmament but regarded as a brilliant move by a wise few may well be ... an act of lunacy!

Earlier this year, I reported on two of the ecommerce biggies, Flipkart, India's largest etailer, and Myntra closing down their mobile and desktop sites so they could focus exclusively on apps. To many, it appeared that in a market frothing with ecommerce activity, where the number of mobile users will climb to 400 million by next year, expecting someone to download an app to access your site just seemed a bit off.

Still, many good reasons were offered for going solely the app way: Better targeting and data gathering of customers; high costs in maintaining disparate technology platforms; slow internet speeds marring the ecommerce experience.

Apparently, none of them turned out to be serious enough to justify switching to an app. In a major rethink and then a reboot of tech strategy when it comes to online sales, major ecommerce sites in India have come full circle.

As Livemint reported, Flipkart has resurrected its mobile website some 6 months after burying it. Its fashion arm Myntra plans on doing the same apparently. These restarts will now be done through a "mobile app" specifically tweaked to provide the functionality of a browser and the experience of an app. Snapdeal, another heavyweight in the ecommerce field, said that it was going the same route.

So, why did this strategy implode?

For the simple reason that the great boom in smartphones in India has happened thanks to low-cost devices and these are equipped with pretty anaemic memory. Installing and uninstalling apps just to shop can be an infuriating process (apparently 90 percent of apps are uninstalled).

Fashion site Myntra experienced being on the rough end of the decision to go the app way very quickly. Apparently, before its app-only push, Myntra's sales were going gangbusters, doubling or tripling sales. Moreover, one of its chief competitors Jabong began to experience a meltdown, with sales beginning to sputter and senior staff jumping ship in droves. This was the moment to deliver the quintessential killer bite to a ferocious competitor and put them away forever. The app, however, prevented this from happening, according to Livemint.

Even Snapdeal's CEO Kunal Bahl apparently confessed in an interview with another paper that Myntra's app-only strategy helped Snapdeal accumulate wind under its fashion businesses' wings. Myntra says that it pumped over 90 percent of its traffic from its mobile app anyway before the site got shut, so it doesn't know what the fuss regarding going the app way is about and will continue to leverage it as one of its channels in the future.

That may be so, but there are definitive winds of change blowing in mobile ecommerce strategy -- and possibly quite fiercely. Deepak Gaur, managing director at venture capital firm SAIF Partners, said that "increasingly, we are seeing re-prioritization of mobile web and companies (in SAIF's portfolio and others) are giving equal attention to mobile web again".

Stay tuned, though. This trend could reverse tomorrow.

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