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Is Amazon Helping or Hurting Small Business in India?

Brent Peterson February 6, 2019

India is currently experiencing an eCommerce boom. The country’s eCommerce spending is expected to double by 2022. Despite the success online, only about half of the country’s 51 million small businesses have a web presence. The largest eCommerce platform in the country by far is Amazon. This begs the question: is Amazon bad for small businesses in India?

Brick and Mortar Versus the Internet

Across the globe, Amazon has been blamed for slowing traffic at malls and for the death of countless large retailers. It’s true that more people are turning to the web than going to actual stores and vendors; it’s convenient to find everything you need online at one place. Instead of bouncing from store to store and spending a whole day shopping, customers can now buy all their items in minutes via the click of a button.

This hurts large competitors of Amazon, because they simply can’t keep up with the demand. However, due to the structure of Amazon’s marketplace, Amazon’s growing successes isn’t necessarily bad for many small businesses.

Amazon Prime for Small Business

Amazon Prime just recently became available in India. The popular service has over 100 million subscribers worldwide, including a growing base in India. While this may initially sound like an unfavorable situation for small Indian businesses, Amazon Prime may actually be a blessing in disguise. Amazon’s marketplace gives many small businesses a platform to sell their goods. If a small business is not large enough to have its own website, it can take advantage of Amazon’s forum to market and sell their goods. Many Indian businesses have already signed up. The Prime selection in India now features more than 40 million local products from third-party sellers.

Amazon Prime is also an amazing tool for local Indian film makers. Prime video is investing in India original video content. They have already launched two premiers, and have over a dozen new shows in production.

Best of Both Worlds

As most Indian small business owners start their journey online, they may find it is most effective to take advantage of Amazon, while still doing their own thing. In the digital age, it is imperative that all businesses have their own website. With the rise of the Internet, window shopping isn’t what it used to be. Instead of strolling by the local shops to find the best businesses, customers are surfing the web to find the products they are looking for. Now, the homepage of your website is your “window” to the world. By creating an alluring website, business owners can draw customers directly to their products.

Unfortunately, having a stunning website isn’t always enough to garner customers. There are over 644 million active websites. To draw attention to their site, business owners have to spend a lot of time and money on marketing. Some companies simply do not have the means to invest in online marketing. That’s where Amazon can help small businesses. Amazon already has the customer base, marketing team, and positive reputation. By listing items on Amazon, small businesses can take advantage of Amazon’s huge customer base.

By listing on Amazon’s marketplace and having their own website, small business owners really can have the best of both worlds. They can create a positive first impression through their own website. The website address can be given to local or returning customers, so customers can have a direct interaction with the small business owner. The Amazon eCommerce shop can be used as a secondary way to gain customers. By taking advantage of Amazon’s popularity, small businesses can gain customers they never would have met offline.

Over two-thirds of small business owners who sell products online say Amazon has positively impacted their sales. Although Amazon may be trouble for large competitors, overall, it is helpful for small businesses. As more small companies in India start to head online, Amazon can help them get off the ground, and start selling.

For help making your eCommerce business stand out in a competitive digital world, get in touch with us at Wagento.com today.

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