Meesho, supported by Meta, beats Amazon and Walmart in the race for Indian buyers

Bengaluru-based Meesho is leading the booming social commerce industry, allowing users to sell items by sharing product listings with friends through Meta Platforms Inc.’s popular WhatsApp messaging service, as well as Facebook and Instagram. Meta is also an investor in Meesho, with an undisclosed stake.

Meesho was the world’s most downloaded shopping app in the first half of this year, according to app analytics firm Apptopia, with shoppers highlighting its ease of use, wide product selection, and features. low prices. Some 127 million people downloaded the app, which is only available in India, compared to 81 million downloads for Amazon and 50 million for Flipkart during the period.

Amazon and Flipkart are “more for the top 1-5% of the population” in terms of income, specializing in more expensive products such as smartphones and TVs, said Meesho chief financial officer Dhiresh Bansal.

Meesho’s goal is to be the online leader in the simplest of products, such as clothing and homewares, often sold in the unorganized retail trade, which accounts for up to 85% of India’s retail sector, Mr. Bansal said. The startup caters to the legions of consumers who used to shop at convenience stores and are now turning to the internet, he added.

Meesho was founded in 2015 and has raised $1.1 billion from investors including Meta, SoftBank Group Corp.’s Vision fund, Sequoia Capital India and Facebook co-founder Eduardo Saverin’s venture capital fund, B CapitalGroup. Meesho is not profitable, but Mr. Bansal said it will be at some point and will aim to be listed publicly. It is valued at around $5 billion.

Meesho has a long way to go to catch up with Amazon and Walmart, which together have pumped more than $22 billion into India since 2014. India, according to a report. of the American investment company AllianceBernstein. Meesho is responsible for about $5 billion, or 7% of India’s total sales.

American companies have entered India keen to capitalize on the hundreds of millions of consumers logging on to the South Asian country for the first time, although the growth of online shopping as a proportion of total retail has been slower than in other major markets. E-commerce still accounts for just 5% of retail sales, well below the global average of 14%, according to AllianceBernstein.

India’s e-commerce market is expected to nearly double to $133 billion in 2025 from $72 billion this year, driven by consumers in small towns and villages, according to AllianceBernstein.

Mansi Khajuria, an 18-year-old student, lives in a village of several thousand people called Barooki, in the northern Indian state of Uttar Pradesh. She did a few purchases on Amazon but never tried Flipkart.

She prefers Meesho’s wider selection of products, frequently buying items such as tops for as low as 99 rupees, or $1.20, and shoes for $1.46.

“Meesho is my Zara,” Ms Khajuria said, referring to the Spanish-owned fashion retailer Inditex she’s heard of but can’t afford.

Customers open Meesho – its name is a combination of the Hindi word for “my” and the English word for “shop” – and browse a TikTok-like feed. It mostly shows unbranded items such as sarees, sunglasses and shampoo, many of which cost less than Amazon or Flipkart.

Users can order products and pay for them in cash when they arrive at their doorstep. Shipping is free and there is no minimum order amount. Sellers set their own profit margins. Ms. Khajuria, for example, often sells items to friends via WhatsApp and Facebook, earning between 61 cents and $1.22 per transaction.

Meesho generates revenue largely through advertising, with sellers paying to display their items more prominently in the app, similar to one of the ways China’s Alibaba Group Holding Ltd. earns money through its popular shopping service Taobao.

Last month, Meesho’s app was opened more than 1.4 billion times by its users in India, compared to about 875 million for Flipkart’s app and 570 million for Amazon’s, according to Apptopia.

Amazon, which has invested $6.5 billion in its India operations since launching in the country in 2013, entered the social commerce market itself in April, acquiring a startup called GlowRoad for an undisclosed amount. . An Amazon spokeswoman did not respond to a request for comment on Meesho.

Flipkart, which started operating in 2007, launched a social commerce platform called Shopsy last year. A Flipkart spokeswoman said Shopsy was growing rapidly but declined to comment on Meesho. Walmart in 2018 acquired Flipkart for $16 billion and two years later led a $1.2 billion investment round in the company.

Other companies are also emerging in India’s developing e-commerce sector. They include ultra-fast delivery startups, such as Dunzo and Zepto; local giants Reliance Industries and Tata Group, both of which are getting into e-commerce; and the Indian government, which launched a limited launch of its own e-commerce aggregator last month.

The aggregator, which integrates listings from Amazon, Meesho and others, allows consumers to search across multiple platforms, compare prices and make purchases. The government says it is designed to democratize online shopping and empower small players. A Flipkart spokeswoman declined to say whether the company would participate.

Ms Khajuria said she was looking forward to selling – and buying – more on Meesho this month ahead of Diwali, the festival of lights which is one of India’s main holidays.

“Everyone shop during festival season,” she said. “With more money, I will buy more.”

—Vibhuti Agarwal contributed to this article.

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