Myntra is shutting website from May 1 – is it a right decision to make?

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According to some news published on various platforms, Myntra will shut its website from May 1 to become a mobile app-based retailer.

The report states that Myntra pulls in about 80% of its traffic and 60% of sales through its mobile application. It has plans to take the sales number to 90% by the end of the year. When that happens, the fashion e-tailer will most likely shut down its websites according to sources familiar with the matter. If it does indeed happen, it will be the first instance of an online e-tailer going mobile-only from web + mobile format.

According to Mukesh Bansal, co-founder of Myntra and CMO of Flipkart, the growth on the mobile platform has been rapid because fashion shopping is quite impulsive. Myntra is focussed on the mobile platform and will be making major investments on this platform going forward.

Myntra is on course to complete Rs 2,000 crore in sales or gross merchandise value (GMV) for the current financial year. GMV refers to the overall revenue generated by online retailers through sale of goods on the online platforms. Out of the total GMV, the e-tailer makes around 5% to 20% depending on the category.

In the fashion category Flipkart/Myntra’s biggest rivals remain Amazon and Snapdeal. Amazon recently started the fashion category in India, whereas Snapdeal too is on course for a $1 billion in sales under the fashion category.

After electronics, fashion is the category which makes the most moolah. It accounts for nearly 30% of the GMV according to a report from Morgan Stanley.

There may be multiple thoughts behind this but I have few contradicting thoughts on the matter:

60:40 Ratio

Report says that Myntra’s 80% traffic comes from Mobile web/ app which accounts for only 60% of the sales on the other hand PC web traffic which is only 20% accounts for 40% of the sales.

It means that users who use mobile platform are less prone to buy stuff on Myntra. What if company goes mobile and remaining 40% don’t even have a chance to buy from Myntra?

Loyalty doesn’t exit anymore

Gone are the days when customers were loyal to one retailer or brand, in today’s web woven world customer has choice as well as options to explore and compare their options.

And adding to that we take time to adapt to change, my worry is that during this phase of adaptation many customer might go to the other e-tailers who are the biggest competitors e.g., Snapdeal, Amazon etc.

Are smart phones really smart?

Most of the Indian smart phones are targeted towards low or mid range phones, which comes with a cost of low space. Space required for App installation and updates is most painful scenario among users. I don’t know about normal user behavior but when ever I see space crunch in my mobile, first victims to get uninstalled are the apps belonging to e-commerce.

What about tier-2 tier-3?

When it comes to expansion everyone talks about market in T-2 & T-3 cities but when it comes to apps most of the users in these cities are still not using smartphones and even if they are using they don’t have 3G connectivity option. Will 2G speed be sufficient to run Myntra app and provide a better user experience?

These are few thoughts which Myntra might have already thought but are important to keep in mind while taking such a big decision.

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Mohit Bansal(23) is B.Tech in Electronics and Communication Engineering from Indian School of Mines, Dhanbad, India. He has interest in business and entrepreneurship and has published couple of research articles. He is also associated with various NGOs. He is with Techaloo when it was just in concept stage. The Techaloo site was not existing even then. Currently Mohit is working with Mu Sigma as a Business Analyst Profile.

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