Online retailing giant Flipkart has launched an annual membership fee-based service for its customers. Flipkart First is aimed at rewarding its frequent shoppers, which the company claims are about 18 million for the portal, as well as getting new ones on board. Notably, the Flipkart First service is similar to the Amazon Prime premium subscription service in the US, and it will be interesting to see if this forces Amazon to bring Prime to India.
With the US $ 3 billion Indian e-commerce market poised to register double digit growth, analysts are of the view that companies are looking at innovative ways of not just adding new users from smaller parts of the country but also retaining existing shoppers.
According to the e-commerce giant, the Flipkart First annual subscription service will offer customers unlimited access to In-a-Day Guarantee delivery; free standard delivery with no minimum purchase price; Same-day Guarantee delivery at a discounted price, and a bonus 60-day replacement guarantee, instead of the usual 30-day period. In addition to that, the Flipkart First annual subscription service will also offer customers’ access to priority customer service with minimal waiting period.
“Our growth is, partly, due to our innovations. In the past few years, we have led the supply-chain innovation and today’s launch is a part of this journey. We are also looking at those Internet users who hit e-commerce portals often to shop,” Flipkart co-founder Binny Bansal told PTI. “We are the first in India to offer such a service. Members will be entitled to a host of exclusive benefits as well as priority service. They will always come first,” he added. Bansal, who is also the COO at Flipkart, said customers in India are maturing and looking at value over cost and such services will push the ecosystem to another level.
In contrast, Amazon Prime service offers customers in the US a free two-day shipping on orders with no minimum order size. It even gives access to unlimited instant streaming of movies and TV shows with Prime Instant Video (available in US) and also offers free books every month via Kindle First and the Kindle owners’ lending library.
Amazon Prime annual subscription service is available at $99 (Rs. 6,000 approximately) for one year. While Flipkart did not disclose the subscription fee, it will offer the service free to 75,000 randomly selected customers for a period of three months, starting May 20.
The official Flipkart First page notes that the benefits on the annual subscription are only applicable for purchases from WS Retail, as of now.
“The services include free shipping for all orders, free ‘In-a-Day Guarantee Delivery’, same day guarantee delivery at a discounted price, 60-day replacement policy, priority service from customer support and a host of other benefits to be added soon,” Flipkart VP (Marketing) Ravi Vora said. “If we look at online shopping in the last 12 months, about 16-20 million users have shopped online. Of this, while regular shoppers are about 20-30 per cent, the remaining are still experimenting with this medium,” Vora added.
It’s worth mentioning that Amazon.in, Amazon’s Indian online store, had launched the ‘guaranteed one-day delivery’ offer first for few select Indian cities, at an extra charge last year. However, Amazon India is yet to announce an annual subscription service for the Indian market.
Snapdeal, following the lead of Amazon India and Flipkart, introduced its version of guaranteed same-day shipping, called ‘Express Delivery’ in January this year.
Source: Flipkart First