Flipkart-Owned Ebay India Shuts Down: Here’s Why It Never Took Off

Ebay in India has shut down and Flipkart will open a new site to replace it.

Tech News
3 min read
So long, Ebay India. 

Ebay in India, now owned by Flipkart, which itself was acquired by Walmart recently, will no longer be available for consumers. The website has been taken down, and as you can see above, Flipkart plans to introduce a new platform in its place.

But coming back to Ebay, which entered India in the early 2000s by acquiring, failed to operate with its globally recognised marketplace model. Here are some of the reasons as to why Ebay in India didn’t succeed as many expected.


Early-Mover Disadvantage

Ebay came to India in 2005, which was a couple of years before Flipkart in the country. The marketplace model didn’t suit the choice of Indian sellers and buyers back then, especially not on the internet.

Ebay’s decision to buy Baazee was a good business move for the long-term, but the model, especially the business of online buying was rather alien to people in India back then. It’s only after Flipkart started up that people warmed up to online shopping, which was initially restricted to books and music, small-ticket purchases that didn’t carry a lot of risk while dealing on the internet.

Lack of Quality Checks

People who bought stuff from Ebay India had basic issues with the platform. There were no guarantees for the buyer or seller, which meant either of them could take the other one for a ride.

People started posting offers with fake pictures of the product, which Ebay didn’t think of verifying. This resulted in distrust among buyers, who couldn’t rely on Ebay, leading to doubts on the quality of products sold on the platform. Gradually when people had other platforms to choose from, Ebay saw a drop in number of users coming to its platform.


Auctions Didn’t Entice Indians

Ebay made its revenue with business models like auctions - where buyers bid for a product - that did exceedingly well in the West. The online platform missed a trick by not localising its model to India, hoping that Indian buyers will acclimatise to its global formula, which wasn’t the case.

Ebay India was bought by Flipkart in 2017. 
Ebay India was bought by Flipkart in 2017. 
(Photo: Reuters)

In the auctions model people had were asked to bid for a product and grab them once the deadline got over. Without the convenience of digital payments, this was unlikely to work in India and gradually it became clear that it didn’t. By the time Ebay started offering shopping cart on its platform, the likes of Flipkart and even Snapdeal had created a space for themselves.

Not Realising Online Potential in India

From being a $20 million industry to over $10 billion in less than two decades, India’s e-commerce sector was all about potential worth tapping into. Ebay, sadly didn’t see it coming, which is why the platform, acquired by Flipkart in 2017 after raising $1.4 billion via Tencent and Microsoft, has come to a close.

The basics of online shopping was always missing on Ebay, and even after hiring industry veterans, the company’s policy remained unchanged. And if there’s anything you can’t do in a dynamic industry, Ebay India did all that and more. These reasons have contributed to Ebay shutting down in India, and it remains to be seen what the Walmart-owned Flipkart plans to do now.

(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)

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