Snapdeal Vs Amazon | Why Snapdeal failed?

Snapdeal was founded in 2010 by Kunal Bahl and Rohit Bansal. With the kick-off of Jio-mart and Tata Cliq, the e-commerce platform is becoming highly competitive in India. Snapdeal was going pretty good during the initial period, let's know the logic behind the fall of Snapdeal's reign.

Why did Snapdeal fail against Amazon? 

From a technical aspect:

1. Snapdeal has a poor acquisition.

Snapdeal acquired twelve companies in their six years occupancy and couldn't hold any opportunities from them. Imagine buying products which you aren't even sure of their applies. 

Somewhere, the organisation lost its reign in the battle with other opponents of e-commerce like Flipkart and Amazon. The main audience for Snapdeal was tier 2 and 3 cities which was well connected and they should have got hold of it instead of matching prices with other companies. 

They acquired Freecharge in 2015 and after a few years, in 2017, they miserably sold it to Axis Bank for 60 million USD, which was bought for 400 million USD. Almost 90% loss. Snapdeal could make it a new Paytm but they failed to optimise/integrate it properly. 

Snapdeal could make a good come-back if Freecharge was integrated properly.

2. Snapdeal never aimed to be the market leader

Snapdeal never tried to become a market leader. It left the battleground and let Amazon and Flipkart fight. They knew that Flipkart and Amazon would pay a lot of money and energy to compete to get to the top and Snapdeal will get out of the way by simply copying what Flipkart and Amazon used to do to bring out an e-commerce revolution. 

What did Snapdeal do? Snapdeal simply followed the market tactics and strategies of both the popular e-commerce site because they thought there would be no rivals except Flipkart and Amazon and all they got in return was several new e-commerce startups especially Jiomart and Tata CLiQ. 

They never introduce any change that could get them to the top and simply aimed to be at the top 3 list.

3. Snapdeal had massive funding but lacks purpose.

Snapdeal enjoyed massive funding in the very first place.

What's next? They lost purpose and intention to make it a big company, rather they aimed for personal growth and stop caring about the company growth. The purpose was to get more funding, leaving behind the notion. 

Snapdeal played it safe for some years after its release, now it's around the corner to collapse because the whole intention of copying the strategies of Amazon and Flipkart has left them nowhere. 

Due to the mass funding and capital at the beginning, Snapdeal made it to the e-commerce website overnight and things went so fast and smooth after then. Overnight successes are usually meant to collapse as the notion of keeping the business stable easily vanish. It was at 6 billion and declined to a billion.

4. Snapdeal did a bad job with the hiring process.

Unlike Amazon, Snapdeal lacks focus on expenses. They hired too many people to handle the company, in return, the company paid a lot of expenses. It may be possible due to the over-confidence they had in the first place when the funding was too high. 

Apparently, the company has too many employees but the number of projects was quite less if compared. 

When the number of employees is more than required for a project, we termed it disguised unemployment. It may or may not be in the case of Snapdeal, but we can certainly say that overhiring took in the first place. You may call it brutal-hiring. The deserving employees were outside while the non-deserving stayed inside and enjoyed a huge paycheck.

From a customer-aspect:

1. Snapdeal has pathetic customer service.

Snapdeal, as an e-commerce site, failed to provide its customers with reliable customer service. It's either neutral or bad. 

Amazon is quite serious with the customer's satisfaction and has provided us with fantastic customer service. 
Amazon has captured the attention of buyers through its extraordinary customer service. On the other hand, Snapdeal has an average rating on its customer service.

From a seller aspect:

1. Sellers face numerous problems due to changing policies.

Snapdeal made numerous changes in its policy.

1st change: Snapdeal placed a limited number of regular orders that a seller could dropship so that sellers would be made to use warehouses.

2nd change: The Middle team in Delhi built an ASR (Advance Stock Receipt) of the products that you could send to the warehouse, which take roughly a week. 

Amazon allows you to generate ASR. Simultaneously, products were unavailable in stock.

3rd Change: As the sellers have no alternative, they have to ship all the goods to the warehouses, so even slow-moving and latest products were sent to the warehouses, this lead to the clogging the warehouses. So they commenced a new policy in which only large commodities could be allowed to store in the warehouse.