• Amazon incentivizes sellers, puts pressure on Flipkart

    Amazon India has cut its own commissions by 25-30% in key categories such as mobiles, PCs, electronic devices, and personal care appliances. This may put the American e-commerce giant’s local arm at an advantage over rival Flipkart, which recently increased its commissions across key segments and also asked sellers to bear the costs of logistics in case of returns.

    In a communication to sellers, Amazon India has said that its latest policy changes will be effected from June 17. Amazon has reduced its commission for mobile devices and tablets to 3.5%, from about 5.5%, and for desktops and laptops to 3%, from 4%. Electronic devices too have seen a change similar to that of PCs.

    Electronic devices and mobiles are one of the highest selling categories for companies like Flipkart and Amazon India, fueled to a great extent by discounts.

    When contacted, Amazon India spokesperson confirmed the development. “Yes, we lowered the rates for certain categories. We think these revised rates can significantly help sellers to perform even better and succeed in their business,” the spokesperson said in an emailed response.

    Amazon noted that it started with just 100 sellers three years ago and now has over 85,000 sellers. The number is growing at 250% year-on-year, and Amazon is adding over 90,000 products per day, the company said. Among other categories, the company has reduced its commission from 12% to 5% on movies and educational software. However, it had recently increased commissions in some categories such as mobile accessories.

    Market leader Flipkart has had to face resistance from some sellers on its platform following its revised seller policy. Flipkart’s new seller policy will be effective from June 20. Amazon CEO Jeff Bezos recently announced another $3 billion commitment for the Indian market, taking its total investment in India to $5 billion. Some of these funds are now clearly being used to woo sellers. Jrue Holiday Jersey

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