Amazon CEO Jeff Bezos has announced that his company will increase its investment in India, one of the fastest growing economies.
Amazon to invest $3bn More in India’s e-Retail Industry
Speaking at a function in Washington, Mr. Bezos said that Amazon would put in $3billion into its operations in India, an increase from the $2 billion he had announced in the summer of 2014.
Amazon, and in particular Bezos, views India as an increasingly important international market with long term potential and is willing to do anything to capture this market.
In India, Amazon faces competition from Snapdeal and Flipkart. Even then, all e-commerce retailers still face considerable challenges in India where most online shoppers shop based on prices, causing ecommerce site to engage in stiff price wars that are unsustainable in the long-term.
For amazon and indeed for its competitors, the challenge is to find ways to attract their target audience.
At the same time, the online shopping market in India is still small compared to that of the US, despite being the second most populous country in the world. However, high smartphone penetration is seeing an increase in online shopping trends.
Amazon is especially keen on succeeding in India given that it has largely performed poorly in China. In a statement at a press conference, Mr. Bezos admitted that his company had witnessed two starkly different results in India and in China.
He attributed the difference in performance to the fact that the company tried to apply the same strategy in China as it had applied in Germany, Japan, UK, US, Italy, France and elsewhere. On the contrary, the Chinese market needed more customization at the local market level and that is a lesson Amazon has learnt the hard way.
On June 9, 2016, Mr. Bezos received the 2016 USIBC Global Leadership Award presented by Indian Prime Minister Narendra Modi at the 41st Annual Leadership Summit at the Mellen Auditorium in Washington.