Flipkart will be shutting down eBay.in, which it acquired in April 2017, and will be creating a new proprietary platform from which to sell refurbished goods, The Economic Times reports.
The decision marks the end of Flipkart’s strategic partnership with eBay following the Indian company’s acquisition by Walmart: The two will be winding down their commercial agreements, and Flipkart’s license to use the eBay.in brand will be terminated.
eBay will be relaunching eBay India shortly, and will shift its focus in the country to cross-border trade. All customer transactions will cease on eBay.in on August 14, and Flipkart will begin efforts to get customers to migrate to the new platform.
The new refurbished goods platform is meant to widen Flipkart’s appeal to consumers, but the transition away from eBay may cost it customers. The new platform has a different target audience than Flipkart on the whole, according to Flipkart CEO Kalyan Krishnamurthy, suggesting that it may be targeting shoppers who place less emphasis on new items than on price.
While Flipkart is confident that it can create a successful new platform — partially thanks to its acquisition of mobile and repair services company F1 Info Solutions and Services — it must make the transition from eBay.in to the new platform as smooth as possible to avoid losing customers who aren’t inclined to migrate to the new platform.
Without its link to Flipkart, it may be difficult for eBay to reenter India. At the time of the merger between eBay India and Flipkart in 2017, eBay wasn’t doing much business in the country, sources told The Hindu Business Line, and the decision was made to sell eBay India to Flipkart as a play for long-term success, eBay CEO Devin Wenig told Recode.
Its detachment from Flipkart means that the e-tailer will have to start anew in a country where it’s struggled previously and will be competing for cross-border sales with the likes of e-commerce titans such as Amazon.
Meanwhile, eBay has been enjoying success in other international markets that could help inform its tactics in India. While eBay’s future in India may be in doubt, the e-tailer has been growing well in the UK, Australia, and Germany. The latter two countries are the only places where eBay Plus, the company’s subscription service that offers free shipping and returns, double loyalty points, and exclusive offers, is available.
While eBay’s focus on cross-border trade in India is slightly different from its business model in these other international markets, it should consider implementing an interest-boosting strategy similar to eBay Plus to attract customers and help fuel early growth as it tries to reenter the market. Alternatively, the company could test practices in India that have proven successful in other foreign countries.