The great e-commerce divide: Market leaders thrive, Snapdeal, Tata CliQ struggle to survive
Snapdeal, awaiting Sebi clearance to get listed in the public market, is banking on growth in clothing and fashion categories, particularly in small towns.
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India's e-commerce industry is undergoing a dynamic transformation. Once marked by heavy cash burn and discount wars, online marketplaces are now demonstrating sharper financial discipline. Recent data showing shrinking losses, double-digit revenue growth, and increasing advertising income have bolstered the industry's confidence like never before.
At the heart of India's $125 billion e-commerce market, two players--Walmart-backed Flipkart and Amazon India--who together hold 48% and 32% of the gross merchandise value (GMV) market share for online marketplaces, respectively. Yet, newer challengers such as Meesho, Nykaa, and Flipkart's Myntra are rewriting the playbook by wooing diverse customer segments, especially Gen Z shoppers.
Latest financials (FY 2024-25) highlight this shift. Flipkart cut losses by 37% to Rs 1,494 crore for April 2024–March 2025. Amazon Seller Services sharply reduced losses from Rs 3,469 crore in FY24 to Rs 374.3 crore in FY25.
Flipkart's premium fashion arm Myntra clocked nearly an 18-fold rise in profit, touching Rs 548.30 crore in FY25. Competitor Nykaa, run by FSN E-Commerce, reported an 81% year-on-year profit growth, reaching Rs 72 crore.
Meanwhile, Softbank-backed Meesho continues to remain a key disruptor in this space. While its FY25 numbers are yet to be disclosed, the company previously trimmed its losses by 97% to Rs 53 crore in FY24 from a staggering Rs 1,569 crore the year before, highlighting its strategic progress.
Snapdeal, which targets smaller cities and towns, lowered its FY24 losses to Rs 160.4 crore, down from Rs 282 crore in FY23. Moreover, Tata CliQ Fashion's parent, Tata Unistore Limited, reduced losses to Rs 391.6 crore from Rs 874.7 crore a year earlier.
However, revenue performances give a clear picture of winners and laggards. Flipkart and Amazon reported robust revenue growth--14.4% and 18.6%-- to Rs 20,493 crore and Rs 30,139 crore, respectively. Meesho registered a 33% spike, reporting revenues of Rs 7,615 crore in FY24.
In contrast, Tata CliQ and Snapdeal struggled, with revenues consistently declining. According to the data and research platform Tracxn, Tata Unistore's revenue dropped from Rs 849.3 crore in FY22 to Rs 249.3 crore in FY24, with a compound annual growth rate (CAGR) falling -11% in three years.
Snapdeal's parent, Ace Vector, saw revenue shrink from Rs 563 crore in FY22 to Rs 384 crore over the same period.
"Having a brand legacy and early market entry do not ensure long-term success in e-commerce," says Dr Vandana Tandon Khanna, Professor-Marketing, K J Somaiya Institute of Management. Somaiya noted that Snapdeal, despite a 13% market share, has struggled with margins, trust, and scale, while Tata CliQ's authenticity and “phygital” strategy are offset by rising losses and weak category breadth.
Industry experts argue that the survival of mid-sized players lies in sharper positioning and alliances.
"Strategic partnership across the value chain – logistics, payment, regional brands, etc., can help increase penetration and potentially lower costs," said Kritee Jhawar, AVP, Avalon Consulting.
"Focused positioning with a clear execution strategy is a key for mid-sized players to remain relevant".
Another revenue engine powering the majors is advertising. Amazon's ad revenue jumped by 24% to Rs 8,370 crore in FY25, while Flipkart's touched Rs 6,317 crore. Myntra too saw a spike of 28%, with ad income surging to Rs 914 crore. Though Tata Cliq and Snapdeal have not disclosed their advertising revenues, marketing services remain Snapdeal's largest contributor, generating Rs 252.55 crore.
With the festive season approaching, e-commerce players are gearing up for another round of aggressive campaigns and AI-led technological advancements. Snapdeal, awaiting Sebi clearance to get listed in the public market, is banking on growth in clothing and fashion categories, particularly in small towns. In its 2024 festive season sale, Snapdeal reported 1.8x growth in order volumes.
Meesho, which has raced past Snapdeal in small towns, has confidentially filed a draft red herring prospectus (DRHP) with the market regulator this year to raise %500 million in primary capital.
Challenges for Snapdeal and Tata CliQ are mounting due to Quick commerce platforms as well. The fast delivery platforms, expanding beyond groceries into electronics and apparel, have emerged as formidable competitors. For Snapdeal and Tata CliQ, sustaining relevance in this billion-dollar marketspace will require more than festive discounts--it will demand reinvention.
