E-Commerce

Indian Tier 2 Cities Proved Fastest Growing Market for Amazon

Amazon Prime Day

Indian festive season starts somewhere around early September each year. The festivals mark a season full of shopping and this year wasn’t anything different. The only major difference that one can witness in the Indian market as compared to a decade ago is the channel of the shopping. Earlier, people preferred to go out, see and experience the products personally and then purchase it. Whereas, now people prefer to sit back, relax and order online those same products but at discounted rates.

Indian e-commerce scene has got bigger with time and is now ruled by the two top players namely, Flipkart and Amazon. Both the e-commerce giants have almost eradicated any other player from the market and enjoy a Duopoly. These players started with the tier one cities where the population was a bit more tech-savvy and non-hesitant to spend on online products and shopping experience. However, with the rise in the Indian smartphone market thanks to cheap smartphones and dirt cheap data rates, newer demographics are joining the online shoppers’ community.

According to an ET Retail report, Amazon did a very good business in the Indian tier 2 cities as compared to the previous years. Around 40% of the devices sold in Indian during Diwali was sold in the tier 2 cities and this is a huge jump from previous years. Amazon’s senior VP also said that the growing acceptance of its Alexa voice services in Hindi is helping its subscription services in and around music in India.

Amazon’s Alexa is one of the largest players in the world in terms of personal AI voice-assistants alongside Apple’s Siri, Microsoft’s Cortana and Samsung’s Bixby. Since Alexa is also launched in Hindi in India, a lot of the Indian consumers feel comfortable to converse with the AI assistant in Hindi. This has converted a lot of voice searches on Amazon into sales according to the Amazon VP.

Amazon played a smart move this season by launching Alexa on a device with Xiaomi. Since Xiaomi is such a popular company in India in terms of smartphones, the availability of Alexa on one of their devices proved to be a game-changer. The people who would have hesitated to buy devices fully dedicated to Alexa got the chance to try it out on a phone that they are buying anyway. This has helped Amazon to reach out to a larger audience and this strategy can be used but other companies as well.

India is a unique market in itself with hundreds of millions of consumers and trillions of dollars of the economy. Amazon is on its way to grasp as much as possible of this golden pie.

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