STG-1-0064 | August 6th 2018

Amazon: Earning in India by

Learning in China

In May 2018, Kshitij, Himanshu and Sharad, three students of a top ranked Indian business
school based out of the National Capital Region of Delhi, and who were huge admirers of Jeff
Bezos, pondered over as to what happened with Amazon.com in China? According to them,
Amazon had won the admiration of the entire business world but had failed in China. On the
other hand, they observed that Amazon had been successful in India since its entry in 2012.
They were keen to probe into the problems that Amazon had faced, the strategy Amazon had
implemented and to ascertain as to how the China experience differed from what Amazon
experienced in India. The trio was famous in their institution for business strategy games during
the business school festivals. They set out to probe as to why Amazon failed in China but was
a huge success in India.

This Case Study was written by Dr. Ashish Varma – Assistant Professor, Ram Agarwal – MBA Final Year Stueent, Sanchit Agrawal –
MBA Final Year Student, Kumar Ashay – MBA Final Year Student, Institute of Management Technology, Ghaziabad. It is intended to
be used as the basis for classroom discussion rather than to illustrate either effective or ineffective handling of a management situation.
This case is based on publicly available information from secondary sources and published sources.
© Institute of Management Technology, Ghaziabad
No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without
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STG-1-0064 | Amazon: Earning in India by Learning in China

About Amazon
The US-based Amazon (termed as Amazon.com), established by Jeff Bezos on July 5th 1994,
was headquartered at Seattle, Washington. The company was originally an online bookseller
which expanded itself to be the world’s largest1 electronic commerce (e-commerce) company. It
is also a prominent cloud service provider (Amazon Web Services) and manufactured electronic
devices such as Kindle e-book reader, Kindle Fire tablet and Fire TV, a streaming media adapter.
As per Amazon.com, the company had offices in more than 30 countries2 around the world. In
India, the company had expanded in 13 states with 67 fulfillment centers.3 In 2017, amazon’s
net revenue was nearly $178 billion, up from $135.99 billion in 2016.4 Internationally, the
major competitors of Amazon were Walmart and Alibaba. In India, Amazon was facing stiff
competition from Flipkart which had been acquired by Walmart in 2018. The other competitors
in India included Snapdeal and Paytm.

The Chinese e-Commerce Market

China is the world’s most populous country and has the world’s 2nd largest retail market after
US. With increase in the disposable income of the rural and urban population, there has been
an increase in the spending power of people. This increase has led China’s retail market to grow
at a fast rate. In May 2018, the total retail sales of consumer goods reached 3,035.9 billion yuan
($471.46 billion5), up by 8.5% year-over-year.6 The online retailing was expected to grow
from 17% of total retail sales in 2017 to 25% of total sales in 2025.7
The Gross Merchandise Value (GMV) of China’s online retail B2C market summed
952.85 billion yuan ($148.18 billion) in Q1 2018, up by 32.2% from Q1 2017. In Q1 2018,
Tmall GMV, a Chinese retailer was up by 41.2% over Q1 2017, taking the largest market share

1
Stefan Pajoviæ, “8 Largest E-Commerce Companies in the World and No, Alibaba is Not the Largest Chinese E-
Commerce”, https://axiomq.com/blog/8-largest-e-commerce-companies-in-the-world/, February 19th 2018 (Accessed
Date: March 31st 2018)
2
“Our global offices”, https://www.aboutamazon.com/working-at-amazon/our-global-offices (Accessed Date: 31st March
2018)
3
Press Release, “Amazon India continues to expand India Infrastructure; adds 5 new FCs”, https://www.amazon.in/b/
ref=amb_link_1?ie=UTF8&node=14907831031&pf_rd_m=A1VBAL9TL5WCBF&pf_rd_s=merchandised-search-
5&pf_rd_r=QXHND8T7Q4FXRYNMT4BT&pf_rd_r=QXHND8T7Q4FXRYNMT4BT&pf_rd_t=101&pf_rd_p=75006da2-
4e7b-4459-aeee-dae9b92ca0b4&pf_rd_p=75006da2-4e7b-4459-aeee-dae9b92ca0b4&pf_rd_i=1592137031", April
26th 2018 (Accessed Date: July 3rd 2018)
4
“Net sales revenue of Amazon from 2004 to 2017 (in billion U.S. dollars)”, https://www.statista.com/statistics/266282/
annual-net-revenue-of-amazoncom/ (Accessed Date: July 3rd 2018)
5
$1 = 6.43 Yuan
6
CIW Team, “Retail sales of consumer goods in China up 9.5% in May 2018”, https://www.chinainternetwatch.com/
25375/retail-may-2018/, June 20th 2018 (Accessed Date: July 4th 2018)
7
Michael Cheng, “e-Commerce in China – the future is already here”, https://www.pwccn.com/en/retail-and-consumer/
publications/total-retail-2017-china/total-retail-survey-2017-china-cut.pdf, 2017 (Accessed Date: July 4th 2018)

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 Amazon: Earning in India by Learning in China | STG-1-0064

of 59.6% in China’s retail e-commerce sales. JD.com took the second largest share of 25.3%
and GMV witnessed a growth of 25% year-over-year. Suning.com ranked third with a share of
5%. Vipshop and GOME took the fourth and fifth places with a share of 4.1% of 1.3%
respectively.8
China had been a mystery for foreign multinational companies (MNC) especially US companies,
right from the day it opened its markets for international business in 1970s. There had been
challenges (Exhibit I) faced by foreign companies such as Google, Uber, WhatsApp and eBay,
all of whom had been decimated in China. A deeper look on some of the major companies that
conquered the world but failed in China is presented below.

Exhibit I: Key Challenges Faced by Online Retailers in China

Source: Modified by the Authors from the source “China E-Retail Market Report 2016”, https://www2.deloitte.com/content/dam/Deloitte/
cn/Documents/cip/deloitte-cn-cip-china-online-retail-market-report-en-170123.pdf, 2017 (Accessed Date: March 2nd 2018)

Uber: In August 2016, Uber sold its China business to rival Didi Chuxing and moved out of
China despite a vast market for cab hailing services. One of the reason for the same was lack of
influential relationship that could have helped Uber integrate themselves in lives of Chinese
population. Another reason could be a lack of understanding the Chinese culture – In Didi

8
CIW Team, “China online retail B2C market overview Q1 2018”, https://www.chinainternetwatch.com/24305/online-
retail-b2c-q1-2018/, June 11th 2018 (Accessed Date: July 4th 2018)

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STG-1-0064 | Amazon: Earning in India by Learning in China

Chuxing, a person can pay for other person’s ride, a technological extension of Chinese culture
which Uber missed on.9
Ebay: Ebay entered China by buying an existing company “Eachnet”. In 2003, Taobao entered
the market under the leadership of Jack Ma. Taobao was a local player and allowed the sellers to
add their listing on the site for free. Ebay used to charge the sellers for the same. In order to stop
Taobao from advertising, Ebay decided to collaborate with ad agencies and also started focusing
on posting ads on buses and subways. This strategy did not help, the reason being not
understanding the Chinese customers who watch ads more on TV and not buses and subways.
This was the major reason where Ebay faltered and in 2006 closed their Chinese site.10
Google: Google was perhaps the best example to show that the MNCs must follow all the
rules and regulations as imposed by the communist government of China. Having a good
relationship with the Chinese government was a must. Beijing demanded to have more control
on the Google data and ultimately, Google decided to stop its operations in China in 2010.11
The common thread among all these US-based companies was that they followed the same
strategy that they had used all over the world. As mentioned below, the Chinese market and
customers were very different.
• China had different requirements in different regions of China.
• Chinese customers preferred e-commerce but at the same time wanted to buy from the
brick and mortar showrooms.
• Product availability was the major requirement the customers looked for on e-commerce
site. The product price had taken a backseat in consumer’s decision to select the shop for
buying goods.
• The Chinese customers were dependent on what their friends and relatives said about the
product in question.
• In general, brand loyalty was missing among the Chinese customers.
• Chinese products enjoy a greater respect and preference among the Chinese customers as
compared to the western products.

9
Clayton Jacobs, “Why major American corporations have struggled in China: Uber”, https://readwrite.com/2017/02/
17/why-many-major-american-companies-have-struggled-in-china-uber-il1/, February 17th 2017 (Accessed Date: July
4th 2018)
10
Andrea Hoymann, “Business Failure in China: Why the Biggest Businesses Failed”, https://blog.sinorbis.com/blog/why-
biggest-businesses-world-failed-china, September 27th 2017 (Accessed Date: July 4th 2018)
11
Benjamin Carlson, “Why big American businesses fail in China”, https://www.cnbc.com/2013/09/26/why-big-american-
businesses-fail-in-china.html, September 27th 2013, (Accessed Date: July 4th 2018)

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 Amazon: Earning in India by Learning in China | STG-1-0064

Amazon’s Strategy in China

Amazon entered the Chinese Business to Consumer (B2C) market in 2004 and subsequently
rebranded itself as Amazon.cn in 2011. To make its entry into the Chinese market, one of the
fastest growing e-commerce markets (the turnover of e-commerce market of China reached to
RMB 323.9 billion, a growth of 76% year-over-year by the end of 2004 and accounted for
1.4% of global e-commerce turnover)12 (Exhibit II), Amazon acquired China’s biggest book
e-retail store Joyo.com for $75 million13 in August 2004. The acquisition of Joyo made it clear
to the business community that Amazon was looking for an inorganic growth in China. The
critics initially rated this as a good move by looking at the differences in the cultures of the
country of origin and country where it was trying to establish itself, but this strategy didn’t
work in the Chinese market as Amazon had lack of local knowledge.

Exhibit II: Retail e-Commerce Sales in China from 2016 to 2022 ($ Million)

Source: “Retail e-commerce sales in China from 2016 to 2022 (in million U.S. dollars)”, https://www.statista.com/statistics/246041/
forecast-of-b2c-e-commerce-sales-in-china/ (Accessed Date: April 4th 2018)

Amazon.cn had major competition from Alibaba and JD.com as they (Alibaba and JD.com)
were pre-existing for nearly five years and had acquired a substantial market share. To grab the
market share, there was a need of certain tweaks in Amazon’s strategy and customization in its
business model. For instance, the business model of Alibaba, the market leader in e-commerce

12
“China Business Guide: 2004 Edition” https://books.google.co.in/books?isbn=9814163007, (Accessed Date: July 2nd
2018)
13
Clayton Jacobs, “Why many major American companies have struggled in China: Amazon” https://readwrite.com/
2017/03/10/why-many-major-american-companies-have-struggled-in-china-amazon-il1/, March 10th 2017 (Accessed
Date: April 4th 2018)

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business, was to connect sellers with the buyers but they didn’t have any warehouses whereas
Amazon.cn had warehouses and products were delivered through it. This turned out to be the
massive difference between both the models. Alibaba’s model could be summarized by its founder
Jack Ma’s statement stating that Alibaba helped others to do e-commerce by providing a platform
to connect the seller and buyer and was not an e-commerce company in itself.14
China had two market categories; first – white label item market in which items were very
cheap. Second – a verified branded item market in which items were expensive and were directly
sold by the major brands. Both these markets were directly targeted by firms such as Alibaba
through their subsidiaries, ‘Taobao’ which handled the sale of white label items in the Customer
to Customer (C2C) market and ‘Tmall’ which provided global and Chinese brands on a B2C
retail platform. Amazon.cn on the other hand did nothing exclusive for handling these markets.
To gain exposure in Chinese market, Amazon.cn had to open a store on Tmall in 2015, which
showed the strong presence of Alibaba in China. Therefore, Alibaba’s success over Amazon
could be attributed to:
• Sound business model: The business model of Alibaba provided hefty operating margins
and earnings growth compared to cost intensive model of Amazon.cn.
• Playing on economies of scope: Alibaba had targeted non-branded market through its
site Taobao and branded market through Tmall and this was not done by Amazon.cn.
• Playing on economies of scale: Alibaba had an active base of 350 million15 buyers which
provide it with hefty operating margins.
• Relationship building: Alibaba had maintained healthy relationship with the Chinese
government. This was particularly important in China to maintain healthy relationship
with the government as the government was the gatekeeper of economy.
As Amazon.cn was eclipsed by its peers in China, Amazon.cn made some last moment efforts
to become popular in China. In 2014, after a decade of being in China, Amazon.cn again
invested $20 million16 in a Chinese company Yummy7717, an online B2C food vendor. In

14
Rohit Chhatwal, “Will Amazon.com Conquer China And India”, https://amigobulls.com/articles/will-Amazon.com-
conquer-china-and-india, January 21st 2015 (Accessed Date: April 2nd 2018)
15
Panos Mourdoukoutas, “Alibaba Beats Amazon”, https://www.forbes.com/sites/panosmourdoukoutas /2017/08/22/
alibaba-beats-amazon/#2e1833973f97, Aug 22nd 2017 (Accessed Date: April 2nd 2018)
16
Catherine Shu, “Amazon Invests $20M In Shanghai-Based Food Delivery Site Yummy77”, https://techcrunch.com/
2014/05/20/amazon-invests-20m-in-shanghai-based-food-delivery-site-yummy77/, May 20th 2014 (Accessed Date: July
3rd 2018)
17
Yummy77 was launched in China in 2013 as an online grocery store which provided fresh groceries and gourmet food
items. Amazon’s $20 million investment helped Yummy77 to expand its market and product portfolio. Yummy77
continued to run independently after Amazon’s investment. Yummy77 suspended its operations on April 7, 2016 due to
its awful financial condition after which it was acquired by Jialebao – “China: Jialebao buys embattled produce e-
commerce company” https://www.freshfruitportal.com/news/2016/05/26/china-jialebao-buys-embattled-produce-e-
commerce-company/, May 26th 2016 (Accessed Date: July 3rd 2018)

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 Amazon: Earning in India by Learning in China | STG-1-0064

2015, Amazon.cn tried to diversify and leverage on the popularity of e-sports by acquiring
Twitch18, a sports streaming platform for $970 million19 but this move was also countered by
Wang Sicong’s (Wang) Panda TV20. Wang used his popularity, extensive resources and knowledge
of local market to build up exclusive contracts with many e-sports team such as Invictus Gaming
and Team Secret which provided Panda TV an advantage over Twitch. 21
Amazon.cn then launched Prime service in China in October 2016 to attract customers, which
provided free shipping from the Amazon.cn global store. However, Amazon.cn was not able to
provide online content streaming to its Prime members due to government restrictions in
China. Despite the various efforts put in by Amazon for gaining market share in China, it was
still among the lowest market shareholders of Business to Consumer (B2C) sales i.e. only 0.8%
(Exhibit III) in China.

Exhibit III: Market Share of e-Commerce Websites in China in 2016

(% of B2C Sales)

Source: “China’s leading online retailers”, https://www.ecommerceworldwide.com/china/ecommerce-in-china?topics=Full%20Report

(Accessed Date: April 4th 2018)

18
Twitch is a live streaming service which focuses on entertainment, vlogging, as well as video game and esports content.
It was founded in 2011 and was acquired by Amazon in 2014. – “Most Innovative Companies”, https://
www.fastcompany.com/company/twitch (Accessed Date: July 3rd 2018)
19
Rakshanda Hossain, “China’s Great Wall: The Failure Of Amazon?”, https://themarketmogul.com/ chinas-great-wall-
the-failure-of-amazon/, August 28th 2016 (Accessed Date: March 31st 2018)
20
Panda TV is a game streaming website, which was founded by Mr. Wang Sicong (only son of china’s second richest man
Mr. Wang Jianlin) in year 2015.
21
Corne Dubelaar, “Esports & streaming: Is China ahead of us?”, https://medium.com/tripleuniverse/esports-streaming-
is-china-ahead-of-us-f73ea5a89b30, July 4th 2017 (Accessed Date: July 4th 2018)

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Amazon Strategy in India

The Indian retail market was considered as the 5th largest global destination in the retail space
accounting for over 10% of the Indian GDP and 8% of the employment generation.22 The
Indian market was very promising in the e-commerce segment and was expected to reach $64
billion by 2020 and $200 billion by 2026 from $38.5 billion as in 2017 showing high growth
potential in the space (Exhibit IV). The Indian e-commerce space was dominated by Flipkart,
which generated revenue of INR 13,177 crore in FY16, followed by Amazon.in (termed as
Amazon India) which generated revenue of INR 2,275 crore in FY16.23

Exhibit IV: e-Commerce Industry Growth Forecast for India ($ billion)

Source: “E-commerce Industry in India”, https://www.ibef.org/industry/ecommerce.aspx, April 2018 (Accessed Date: May 6th 2018)

Amazon started its journey in the Indian e-commerce space in February 2012 with the launch
of its Greenfield project — Junglee.com, a website which allowed customers to compare the
prices of different items online, but it did not facilitate the purchase of the items directly.
Against all the expectations, Amazon favored “greenfield expansion” (A Greenfield project is a
growth choice in which a company establishes its new operations in a foreign country from the
ground up) in India which was contrary to its practice of Brownfield expansions as seen in other
markets such as China. The second big step was the launch of Amazon.in in June 2013, whereas
Flipkart and Snapdeal had already started their operations in 2007 and 2010 respectively gaining
advantage over Amazon.in.

22
“Retail Industry in India”, https://www.ibef.org/industry/retail-india.aspx, June 2018 (Accessed Date: July 2nd 2018)
23
“E-commerce Industry in India”, https://www.ibef.org/industry/ecommerce.aspx, April 2018 (Accessed Date: July 2nd
2018)

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In order to cope for the lost time and attract the Indian customers (The Indian customers
preferred brick & mortar stores as they could gain access to the look and feel of the product
before purchasing it, and they could trust the sales person in case of product malfunction for
repairs and returns), Amazon.in paced its growth in the space investing over $5 billion.24
Amazon.in focused on providing a diversified range of products to the Indian customers,
enhancing its product portfolio and gaining their trust providing fast delivery, hassle-free returns,
optimized app and responsive customer service. To enhance the product portfolio, Amazon.in
concentrated on increasing its seller base. Amazon.in launched various initiatives such as going
local, Chai Cart, Amazon Tatkal, Project Udaan, and Fulfillment by Amazon – FBA
(Exhibit V) in this view. As a result of such initiatives, the gross sales of Amazon.in, net of
discounts and product returns, jumped 250% year-over-year in FY15. In the January quarter of
2017, its volumes or number of shipments grew 150% whereas Snapdeal reported growth of
0% in gross sales, including discounts and product returns, for the year ended March 2017 and
Flipkart quoted healthy sales growth.25 Also, Amazon.in witnessed a growth of 250%
year-over-year26 in the number of sellers in 2015.

Exhibit V: Major Customized Initiatives of Amazon India

1. The Chai Cart: Taking the low number of sellers into consideration, Amazon.in developed a program
aimed at recruiting a swarm of suppliers and subsequently gaining their confidence and convincing
them to partner with Amazon.in. Getting on the wheels, Amazon.in introduced a mobile tea cart
named “Chai Cart”.
The idea, “Chai toh hai bahana, maksad hai aapka vyapar badhana” which when translated to English
means “Tea is just an excuse, the motive is to grow your business” was widely accepted where small
retail owners were made aware of merits of e-commerce over a tea break. Reportedly, in a span of 4
months, the Chai Cart team travelled across 31 cities covering over 9,400 miles27. Reportedly, over ten
thousand sellers enrolled with Amazon.
2. Amazon Tatkal: Described as “Studio on Wheels”, it aimed to enable a new seller to start selling in 60
minutes. It took care of registration of sellers, taking pictures of the products, cataloguing the products
and training the sellers. It managed over 150,000 interactions with sellers across 87 Indian cities.28

Contd...

24
Mihir Dalal, “Amazon increases India investments to $5 billion to take on Flipkart, Snapdeal”, https://www.livemint.com/
Companies/InTrpA1lX6EFAfbAcLCIgM/Amazon-to-invest-3-billion-more-in-India-ops.html, June 9th 2016 (Accessed
Date: June 2nd 2018)
25
Mihir Dalal, “The rise and rise of Amazon in the great Indian e-commerce market”, https://www.dealstreetasia.com/
stories/the-rise-and-rise-of-amazon-41711/, May 23rd 2016 (Accessed Date: July 1st 2018)
26
“Amazon India Sees 250% Annual Growth in Sellers”, https://www.news18.com/news/business/amazon-india-sees-
250-annual-growth-in-sellers-1257842.html, June 17th 2016 (Accessed Date: March 31st 2018)
27
Vijay Govindarajan and Anita Warren, “How Amazon Adapted Its Business Model to India”, https://hbr.org/2016/07/
how-amazon-adapted-its-business-model-to-india, July 20th 2016 (Accessed Date: June 3rd 2018)
28
AdAge, “Here’s how Amazon Seller initiatives helped the brand in 2016", https://retail.economictimes.indiatimes.com/
news/e-commerce/e-tailing/heres-how-amazon-seller-initiatives-helped-the-brand-in-2016/57092554, Feb 11th 2017
(Accessed Date: June 4th 2018)

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3. Project Udaan: Increasing its presence in the rural and semi-urban market and generating employment
opportunities, Project Udaan came with a gambit of unique offline-online blend. The firm would
partner with retail points such as kirana stores, medical stores and mobile shopping outlets which
would act as a rural distribution center for the firm and the store owners would assist the customers
in shopping. Amazon.in converted the small retailers into partners overcoming the problem of lack of
internet connection in the rural areas.
4. Fulfillment by Amazon: Amazon.in put into operation ‘Fulfillment by Amazon (FBA)’ in India
expanding to 41 fulfillment centers in four years, the largest one being in Telangana.29 The vendors
would designate a section of their own warehouses of products to be sold on Amazon.in and
Amazon.in would co-ordinate the delivery logistics. The Amazon.in couriers would pick up packaged
goods from the seller and deliver them to the consumer. This ‘neighborhood’ approach promoted
fast delivery of some products at lower cost.

Compiled by the authors from various sources

Amazon.in offered more than 55 million products from more than 85,000 sellers making it
the biggest online store. In comparison, its competitors – Flipkart and Snapdeal stood at 40
million products from more than 90,000 sellers and 35 million products from over 300,000
sellers respectively.30
Amazon.in tailored its offerings to befit the traditions and lifestyle of Indian customers.
Considering the cash-heavy Indian economy, it introduced ‘cash-on-delivery’ mode of payment
in India. To expand its reach in the country, it tied up with local distribution partners such as
India Post to deliver its products. Simultaneously, it kept on investing heavily to develop its
own logistics network to reduce the delivery time of products. This huge investment in logistics
helped Amazon.in to provide the premium service of one-day delivery on its selected products
in selected areas. The firm even reduced the size of its mobile application for a hassle-free
experience even on low storage smartphones with little computing power.
Amazon.in came up with Amazon Prime to attract more customers. Amazon Prime was a
distinguished paid subscription service which provided unlimited free fast shipping from the
Amazon global store. It also provided access to Prime Music, Prime Video (online content
streaming such as movies and TV shows along with few Amazon exclusive content) and exclusive
access to top deals and coupons. An existing customer could enroll for Amazon Prime at a
nominal cost of INR 999 per year.31 Instead of looking at short-term profits, Amazon aimed

29
Harshith Mallya, “A walk through Amazon India’s largest fulfilment centre in Hyderabad”, https://yourstory.com/2017/
09/amazon-fulfilment-centre-hyderabad-walkthrough, September 13th 2017 (Accessed Date: May 27th 2018)
30
Mihir Dalal, “Flipkart remains India’s most popular e-commerce brand”, https://www.livemint.com/Companies/
EK0HLh8DQypBM54Tlal6eK/Flipkart-remains-Indias-most-popular-ecommerce-brand.html, July 1st 2016 (Accessed
Date: July 2nd 2018)
31
“Unlimited FREE fast delivery, videos, music & more”, https://www.amazon.in/
amazonprime?_encoding=UTF8&%2AVersion%2A=1&%2Aentries%2A=0 (Accessed Date: June 29th 2018)

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 Amazon: Earning in India by Learning in China | STG-1-0064

for a long-term stay in India with Jeff Bezos, founder and CEO of Amazon, announcing
$2 billion32 in 2014 and $3 billion33 in 2016 investments in Amazon India.
Recognizing the need to connect with the customers, to make them comfortable and to create
awareness to reach first time buyers, Amazon.in launched a heavy-duty TV campaign in 2015,
spending around $200 million.34 The campaign focused on flaunting the product portfolio of
Amazon.in with the motto being ‘#AurDikhao’ (translated as ‘show more’). Later on, it featured
itself as ‘Amazon – Apni Dukaan’ (translated as Amazon - your own shop), to gain trust of the
consumers and compete with the brick-and-mortar stores providing services such as one-day
delivery, easy returns and cash-on-delivery. Along with that, Amazon.in came up with Diwali
festive sales such as ‘Amazon Great Indian Sale’ in which it provided heavy discounts on selected
products (up to 50% discount on electronics) to draw and engage the first-time customers. In
2017, Amazon.in reported that during Great Indian Sale, the revenue grew 4.5 times over
normal days while the number of units sold grew 2.5 times over the normal35 while the losses
soared multifold. The competitor Flipkart rolled out its own festive sales such as ‘The Big
Billion Day’ to compete with Amazon.in.

Assignment Questions
I What was Amazon’s strategy in China and how was it different from Amazon’s strategy in
India?
II How did Amazon utilize its experience of Chinese market in implementing its Indian
strategy?
III What are the changes that Amazon should made in its China operations in 2018 given the
promising future of the Chinese e-commerce market (Refer Exhibit II)?
IV How should Amazon continue its operations in India in 2018, to strengthen its position?

32
Anirban Sen, “Amit Agarwal: Making Amazon amazing”, https://www.livemint.com/Leisure/d57baTcStbebeE7oXinVEN/
Amit-Agarwal-Making-Amazon-amazing.html, March 18th 2017 (Accessed Date: March 29th 2018)
33
Mihir Dalal, “Amazon increases India investments to $5 billion to take on Flipkart, Snapdeal”, https://www.livemint.com/
Companies/InTrpA1lX6EFAfbAcLCIgM/Amazon-to-invest-3-billion-more-in-India-ops.html, June 9th 2016 (Accessed
Date: June 2nd 2018)
34
Nivedita Bhattacharjee, “Overcoming the China nightmare: why Amazon needs to win in India, ASAP”, https://
www.techinasia.com/amazon-needs-india-win, January 29th 2016 (Accessed Date: June 1st 2018)
35
Mugdha Variyar, “Amazon’s international losses nearly double to $936 million, India continues to see most investments”,
https://economictimes.indiatimes.com/small-biz/startups/amazons-international-losses-nearly-double-to-936-million-
while-india-continues-to-see-most-investments/articleshow/61255682.cms, October 28th 2017 (Accessed Date: June
1st 2017)

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References
• Rakshanda Hossain, “China’s Great Wall: The Failure Of Amazon.com?”, https://
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 Amazon: Earning in India by Learning in China | STG-1-0064

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