Flipkart building app to offer more online services

Investor Softbank wants it to increase customer base to take on 7 mn members of Amazon Prime

Flipkart is planning to shift its business strategy from running an e-commerce portal to creating an ecosystem of services.

Sources said investor Softbank wanted Flipkart to increase its customer base to take on the 7 million members of Amazon Prime. They added Softbank wanted the online marketplace to create an app ecosystem that would have millions of active subscribers.

“Other than providing Flipkart with additional revenue, it will increase the use of the Flipkart app. A team is involved in building this app and it is taking help from new investor Tencent,” a source said.

Amazon’s Prime membership programme and the assortment of services such as Amazon Now and Amazon Pantry provide a one-stop solution for online shopping and entertainment.

A year ago, rival Snapdeal, which is in talks for a merger with Flipkart, had tied up with Freecharge, Uber, Zomato, Redbus and Cleartrip to create a one-stop app solution to take on Paytm. The Paytm app ecosystem hinges on its mobile wallet, which allows money transfer, online shopping, travel bookings and movie ticket sales.

“We have seen earlier that such plans have failed to find takers. There is also a question of revenue share between Flipkart and the apps it brings on board. This is an experiment for Flipkart to increase its revenue,” said Arvind Singhal, chairman and managing director of Technopak.

Flipkart secured $1.4 billion funding recently and is expecting another $1 billion after it buys Snapdeal. The company is planning to re-enter the grocery segment and intends to make its mobile payment app PhonePe an open wallet.