I’ve heard a lot about foreign startups in Nigeria and Africa. Please read this and let me know what you think > Amazon Invades India | Fortune
Interesting outtakes for me
Online payments are also painful in India
Even for the few Indians with credit cards, online shopping is still “painful,” in Agarwal’s word, with obligatory two-step authentication and cumbersome interstate trading laws.
India is trying to become epicenter of developing world tech
For Amazon to succeed in India, it will have to straddle those two worlds: the wealthy few and the poor masses. If it does, it could have a shot at something else too: helping to create a new model for other emerging markets. If e-commerce takes off across India, the industry could replicate its model for India in other vast developing countries, such as Indonesia and Nigeria. Then, says Sinha, the tech industry would have two global centers: Silicon Valley and Bengaluru. “Just like the U.S. is the economic hub and innovation engine for the top 1 billion people on the planet, India is going to be the innovation hub for the next 5 or 6 billion people,” he says.
The usual suspects. Money has no postcode!
Eight years on, Flipkart, valued at about $15 billion, is now India’s biggest e-commerce company, with 44% of the market—nearly triple Amazon’s 15%—and the two Bansals are each worth $1.3 billion. Tiger Global Management, Accel Partners, and South Africa’s Naspers are key investors.
If you think money has been spent in Nigeria and you’re intimidated…
To signal just how much money Amazon was prepared to plow into India, in September last year Bezos flew to Bengaluru in a visit filled with Bollywood-style bling, arriving one day after Flipkart had closed a $1 billion round of financing. He posed on an ornately painted delivery truck outside Amazon’s Bengaluru headquarters dressed in a white Indian wedding suit and handed a $2 billion mock check to Agarwal. The message was clear: He would spend whatever it took to win.
From the article, I would say local startups might still have an edge over foreign counterparts provided they also have adequate funds or funding to expand across the country or continent and own a larger percentage of the market before the foreign companies can come in and dominate the market. If a local startup has gotten it’s way around its market, understands it’s customers and its providing the maximum value as well as gained their trust, it will be a little difficult for the foreign companies to just come in and seize the market. Just a opinion though.
Konga might be able to understand our economy, ways of doing things, preferences and consumer behaviour more than Amazon, and if used well it will be of advantage to konga. It will take a while before amazon can really understand the differences between the way Nigerians shop as compared to the Americans .
if you factor in how Nigerians love jumping on the bandwagon, you may reconsider your opinion. Many Nigerian customers will just shop Amazon just cus its American even if it costs them more.
I dont expect Amazon in Nigeria anytime soon, I’d say 2-3 years from now at most, any local e-commerce store better consolidate its niche by then. I may be wrong tho, they could come and nothing really shifts or come way sooner than I imagine. It baffling what these companies are becoming tho, beasts.
You are right on the bandwagon issue though, another thing that I think might make Amazon a better option for some people is the catalogue of items or products they offer on their platform which might not be all available on konga, differences in price offerings of same or similar products might make some prefer one over the other.
Some users too might stick with konga as long as they haven’t experienced any bad customer service from them, so I think local companies should try to offer the best services to their users.
Peeps will shop on konga will also shop on Amazon and vice versa as long as both works.cheers
I actually got goose bumps reading that. And I thought Rocket had crazy spends.
But having worked for one of the biggest Indian Companies and actually been in Mumbai for some time, the Indian are going to give Jeff a run for his money. The amount of fight in them is phenomenal, no other nation has it. That said, with this, African e-commerce startups won’t have a chance. He’ll gobble us for dinner.
The boss was unimpressed, they say, regarding their ideas as too cautious and methodical, given Amazon’s late arrival in India. He believed they had to go in with guns blazing. “He challenged us to think like cowboys, not like computer scientists,” Agarwal says. “We needed to move very fast.”
If you think Amazon doesn’t already have tons of data from Nigerian shoppers, think again. We have been browsing Amazon for years now looking for products we would like to purchase, spending time reading reviews, and sometimes going on to buy them using third party courier services like Circuit Atlantic and others. In a world where I want to put together a chair I got from Ikea, realise I need a power tool, order one on Amazon and have the doorbell ring in under 45 minutes (I’m not kidding), one wonders how that Nigerian e-commerce company that will remain nameless plans to fare when they still route goods from a seller in Yaba to a buyer in Yaba through an exchange center in Ikeja.
And we thought logistics was our biggest problem. No. Not being smart about it is.
Amazon has partnered with thousands of small shop owners across the country to act as pickup points in exchange for receiving a small commission per package.
In one word execution doesn’t care about your location, having a model that works is one key in the global battle for dominance. As long as businesses are open to modify their business model to match or fit a local market, they will always one up others that go about aimlessly depending on monopoly when building their businesses.
Think Yudala’s(could be any business) drone strategy versus Amazon’s drone strategy, no one is doing drones here so any drone looks like Gold but when Amazon steps in with their own drone strategy(delivery) it could change everything.
Unless of course local players build a strategy that throughly works and not one that depends solely on monopoly or first to market.
Your post made a lot of sense and made me think from that perspective, learnt something new today, but I will also like to add that everything amazon is today and all strategies they have used has been as a result of lessons and experience gathered from the ecommerce business for years, they have seen beyond the logistics of just completing an order and delivering the good to developing custom made solutions to make everything they do easier, our local companies are barely five years into the game and still have a lot to learn.
That being said, I would say they need to up their game and be innovative if they want to stand up to amazon’s style of ecommerce . Like they say African tech companies can’t afford to loose ,they have to try everything possible and go hard to get a good piece of their target market .
A little note worth stating - at the core of it, this is not a potential ‘Amazon vs Konga/Jumia’ (same as its not 'Netflix vs IrokoTV/ShowMax). Instead this is what happens to any service/product delivered in some way over the web or connected device. It simply means someone else can easily reach ‘your’ customers.
One thing I predict that will happen is a Mittelstand type of ‘foreign’ invasion. Folks always romanticise that a ‘big’ firm (e.g Amazon) will make a play in their space. Whereas what will start happening in the next couple of years (7-8), is that ‘small’ firms will be our major headache. Eg A well organised team in St. Petersburg, Russia will be making a play for ‘your’ customers in Kinshasa or Kano. It won’t be pretty.
What we have is an head start (while they wait for Internet to get better and ecommerce to be trusted ). I also made below comment in a previous thread.
). I also made below comment in a previous thread.