In a daring move the fashion e-retailer, Myntra, is closing down its website and devoting all resources to its mobile-based app. The decision is based on the company’s view that increased mobile connectivity and the ease of availability of smartphones, there is little need for maintaining an online presence. At the first glance, the decision may look a little short sighted.
However, the current statistics show that Myntra gets 80% of its traffic from mobile users, which result in 60% of annual sales. The company believes it can carry this figure to 90%, before the closure of its website.
The e-retailer currently has about 100 sellers, selling products from about 650 brands. The company faces quite a bit of competition from Snapdeal, which is on the road to making $1 billion in fashion sales, compared to $32 million by Myntra.
Snapdeal makes 65% of its sales through its mobile app. Looking at the big picture, the percentage of mobile based transactions have risen to 50% from a mere 5% in less than a year’s time.
Additionally, the company also announced that it is working closely, with fashion designers and celebrities to start its own line of fashion products. For this purpose, the company is also collaborating, with a number of brands that are sold through Myntra.
Currently, Myntra stands amalgamated, with the online retailer FlipKart and together the two companies are trying to create substantial competition for Amazon in the country. The two companies believe that together they can overtake the competition posed by both Snapdeal and Amazon.
This is the first instance that a web+mobile platform based company is moving to a mobile-only platform, but whether other companies follow in pursuit or not is yet to be seen. Even though online sales are dominated by electronics, with fashion being a close second, fashion definitely makes more profit than electronics in terms of online sales.
The move by the company is a gamble that can save it a lot of investment, yet it can also cause a substantial drop in sales for the company as well.