How Alexa and Prime Video Convinced BPL to Move From Flipkart to Amazon

 
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How Alexa and Prime Video Convinced BPL to Move From Flipkart to Amazon

Highlights

  • BPL used to be exclusive at Flipkart, has now moved to Amazon
  • Flipkart sources say BPL marketshare dropped in a big way last quarter
  • BPL says it sees Amazon as a technology partner, not a sales platform

On Thursday, BPL and Amazon announced an exclusive partnership that will see the former's televisions, and also a growing range of household gadgets such as air conditioners, washing machines, and so on launched on the latter's marketplace. "We are delighted to partner wit Amazon.in, to grow our brand presence and expand our reach in the country," said Ajit Nambiar, Chairman and Managing Director, BPL.

"We are thrilled to be the partner of choice for BPL," said Manish Tiwary, Vice President, Category Management, Amazon India. "We are witnessing huge customer demand for appliances such as ACs, TVs, and washing machines."

Before tying up with Amazon, BPL first went online exclusively with Flipkart, about a year ago in May 2016. At the time, BPL had just gone through a major restructuring, and Flipkart helped bring the brand back into focus.

However, now that the two have parted, it would appear that not everything was well between them.

Sources reveal dissent, but the company won't comment
A senior Flipkart executive, requesting anonymity, said that the online marketplace had decided to "reassess the terms" of the BPL partnership because there was "a mismatch in expectations". The executive added that BPL did not expand its range with Flipkart, which wanted to grow by triple digits every quarter.

Sources close to Flipkart further informed Gadgets 360 that BPL's marketshare has been falling the last six months, dropping from 15 to 20 percent, to just 3 percent in the last quarter. These sources also added that BPL's lack of a smart TV range was to blame for this.

However, when we reached out to Flipkart to confirm these details, a representative of the company said it did not wish to participate in the story.

Speaking to Gadgets 360, Manmohan Ganesh, Head, Corporate Strategy at BPL explained that it sees Amazon not just as a sales platform, but as a technology partner, and it is services such as Prime Video and Alexa that made it move to Amazon, more than anything else.

Amazon is a technology platform, says BPL
"Content, smart applications, television, they are all converging into one category today," said Ganesh. "There has been so much talk about Prime Video, and Netflix, and integrating this technology was one of the big reasons for us to move to Amazon."

"So one of the things that is on the roadmap is a BPL TV running Fire OS. It's a big selling point for us," added Ganesh. "Our UI teams are now working with them for bundling, for packing subscriptions with our products, and for building the apps into our products. And Alexa is another big thing, what if your fridge could be used to order groceries by just talking to it? Obviously we are not there yet, but it is definitely possible to envision a future where our fridges and our washing machines and other devices are powered by Alexa. These were some huge strengths that Amazon was bringing to the table for us."

Praising Flipkart as a sales platform, Ganesh also added that the Indian e-commerce marketplace had been a huge benefit to the brand, but added that the move to Amazon was part of a long-term strategic decision. This was also however, what led to the drop in marketshare, he claimed.

"We had told Flipkart a couple of months ago, and since we were shifting platforms, we stopped refreshing the inventory," explained Ganesh. "As a result, our business with Flipkart was almost zero. As to the marketshare, they never told us the sell-through so I can't comment on that."

"With the shift coming, we didn't want to have products left at Flipkart, to prevent any price discrepancies," he added.

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