Flipkart has shut operations at the online retail platform Jabong. The move comes four years after the Walmart-owned e-commerce acquired Jabong for $70 million and saw a 13 percent drop in app downloads for the brand in December 2019. Flipkart’s decision is aimed at empowering its premium fashion marketplace Myntra.
With the move, the Jabong web portal now redirects to Myntra’s shopping portal. As per a report published last year, Flipkart had begun to slash a significant share of its marketing expenditure in Jabong. The latest decision is expected to help Flipkart consolidate its operations and make the marketing budget efficient, the report said quoting experts.
According to reports, Jabong’s web traffic claimed to have declined to 2.5 million in June 2018 from 7.5 million in January 2019 while traffic to Myntra during the same period remained unchanged at 30 million.
“The way ecommerce market in India has developed, customers need to be reacquired consciously. Since the level of stickiness is low, it is better to bring consumers to one site than spread money across multiple sites,” Devangshu Dutta, founder of Third Eyesight, a strategy consulting firm, told Economic Times. “Given how Walmart’s focus as a business is fairly cost and efficiency conscious, it makes sense to consolidate operations,” he added.