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Insider’s Look at Amazon Bazaar Special Store for Value Fashion

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Amazon Bazaar Special Store for Value Fashion

Amazon is making another attempt to enter India’s fast-growing online fashion and lifestyle market, setting up competition with rival Flipkart (owned by Walmart), Reliance’s Ajio, and SoftBank-backed startup Meesho.

Amazon Bazaar

Amazon Bazaar
Photo by ANIRUDH

According to a communication sent to partners, the e-commerce giant Amazon plans to launch a “special store” called Bazaar, where it will not charge sellers extra fees for offering unbranded, trendy fashion and lifestyle products. Items sold on Bazaar will be priced under 600 Indian rupees ($7.2) and featured in a dedicated section to make them easily discoverable, Amazon told partners. The company said that Bazaar will provide sellers access to tens of millions of customers, hassle-free delivery, and no referral fees. Earlier this month, TechCrunch reported Amazon was looking to expand into fast fashion based on job posts. The Indian daily Economic Times also reported on Amazon Bazaar, noting Amazon will likely offer two to three-day delivery.

The fast-fashion e-commerce market in India has grown recently as local startups emulate global leaders like Zara, H&M, and Uniqlo. According to Bernstein’s research, Flipkart leads this market but faces increasing competition from Mukesh Ambani’s Ajio, which has captured about 30% market share. Last year, Ajio quietly launched its value brand Ajio Street, offering a wide selection of apparel and accessories starting at just 199 rupees ($2.4). According to its website, Ajio Street promises the lowest prices, free delivery, and easy returns.

Shein, a global pioneer in the fashion category previously banned in India, is poised for a comeback through a joint venture with Reliance Retail, as the two companies announced last year.

In a recent note, analysts at Bernstein wrote that Reliance-owned Ajio has been gaining users and currently holds an approximately 30% market share based on monthly active users. However, Myntra has the highest market share, with over 50% active users. In December 2023, Myntra showed the highest growth rate among peers at 25%. A closer examination of the business suggests Myntra app users are transacting less than in previous trends. Myntra’s gross merchandise value grew only 12% in fiscal year 2023, compared to 35% in fiscal year 2022.

fashion market
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The fashion market remains highly fragmented, with the online space mirroring the offline space as multiple players vying for market share. In December 2023, Nykaa Fashion saw accelerated growth of 23% year-over-year, its highest rate since May 2022, fueled by tweaks to product technology and premium offerings. Ajio sustained above-average growth, with 22% month-over-month user expansion in November 2023. Urbanic, which gained users after Shein’s ban due to similar products, could not sustain momentum due to poor user experience and inefficient return policies.

Amazon Bazaar is a key new initiative from Amazon, which has invested over $7 billion in India after the company shut down its wholesale distribution, food delivery, and online learning businesses in the country in late 2022.

Last year, Amazon announced that it would invest only $2.3 billion in its e-commerce operations in India by 2030, a much smaller budget than that of its rival Flipkart. Instead, Amazon is focusing more on expanding its AWS cloud computing business in India and plans to invest $12.7 billion in that sector in the country by 2030.

Amazon Bazaar: FAQs

1. What is Amazon Bazaar and what products will it sell?

1. Amazon Bazaar is a new “special store” on Amazon India focusing on unbranded, trendy fashion and lifestyle products under 600 rupees ($7.2).
2. Think affordable clothing, accessories, and other lifestyle items.

2. How is Bazaar different from other Amazon stores?

1. Unlike other Amazon stores, sellers won’t have to pay extra fees for offering products on Bazaar.
2. Items will be featured in a dedicated section for easy discovery and delivered within 2-3 days.
3. Amazon aims to attract new sellers and customers by offering a budget-friendly shopping experience.

3. Who are Amazon Bazaar’s main competitors in the Indian market?

1. Flipkart, Myntra, Reliance’s Ajio, and SoftBank-backed Meesho are the main players in the fast-fashion e-commerce market.
2. Recently, Shein is also planning a comeback through a joint venture with Reliance Retail.

4. What are Amazon’s goals for Bazaar and how does it fit into their overall India strategy?

1. Amazon aims to gain market share in the rapidly growing Indian fast-fashion market.
2. Bazaar complements their existing e-commerce operations while focusing more on expanding their profitable AWS cloud computing business in India.

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