Why Myntra’s drop in sales should serve as a dangerous warning for other eCommerce firms

Myntra’s sales dipped by 10% after it turned App only last week. This can avert key rivals Flipkart, Amazon, Snapdeal and Jabong from shifting base entirely to mobile as of now.

There is a broad consensus among e-commerce experts that the changeover is due to the sharp inflow of smartphones in the country. There is no doubt apps can boost business by offering more personalized shopping experience. It’s the future of online shopping.
However, the future is not yet here it seems.

“It is up to individual companies to decide whether to go App-only based on their products and consumer profile. However, currently it is sensible to keep all channels open”, says Sandeep Ladda, Leader, Technology Sector Practice at PwC India.

It’s true that 3G mobile users are dependent on telecom companies’ tariff plans. Broadband is definitely more affordable. One is mobile, the other cheap. What would India go for is anyone’s guess.

Also, some shoppers are more comfortable using desktop versions. It allows them to compare prices and products across sites seamlessly and make an informed choice. They won’t be too keen to shift to App immediately.

“A consumer would want more options. Today, consumer is king, and there are options galore in India. It’s not like Alibaba in China where you’re forced to shop on App”, Mr. Ladda reaffirms. “If costs for maintaining multiple platforms are exorbitant, and the rewards not so high, only then one can take a call”, he says.

The numbers don’t lie either. Only 13% of mobile subscribers are on 3G and 4G networks, a study by Facebook’s internet.org found in February. That means a bulk of the consumer base is still using broadband.

Myntra shut down its website last Friday. It supposedly receives 90% traffic and 70% orders from its app.

(Image credit: Indiatimes)