India’s Meesho is making waves in the e-commerce industry, challenging established giants Flipkart and Amazon. The Bengaluru-based startup, known for its social commerce platform, has achieved a remarkable Gross Merchandise Value (GMV) run rate of over $5 billion. In December 2023, the Meesho app experienced a staggering 32% year-over-year growth, surpassing the growth rates of both Flipkart (21%) and Amazon (13%) during the same period, as reported by analysts at AllianceBernstein.
Key Takeaway
Meesho’s rapid growth and success in capturing the mass-market segment, particularly in Tier 2 and lower cities, underscore its emergence as a formidable player in India’s e-commerce landscape, outpacing industry giants like Flipkart and Amazon.
Strategic Focus on Small Towns and Mass-Market Appeal
AllianceBernstein’s analysis attributes Meesho’s success to its strategic emphasis on small towns and a customer base that prioritizes value. The report reveals that over 50% of Meesho’s sales originate from Tier 2 and lower cities, enabling the platform to effectively target a demographic that has been largely overlooked by Flipkart and Amazon. This focus has proven to be highly lucrative for Meesho.
Backed by Major Investors and Unique Selling Proposition
With a valuation of nearly $5 billion, Meesho has garnered support from prominent investors including Meta, SoftBank, Fidelity, B Capital, and Prosus. The platform’s positioning as a hub for small, unbranded sellers, coupled with its zero seller commission model, has been instrumental in driving rapid adoption and growth.
Impressive Growth Metrics and User Base
Meesho’s order volume has surged by 43% year-over-year in the last 12 months, accompanied by a robust 54% revenue growth attributed to healthy take rates. Notably, apparel and fashion account for 50% of Meesho’s GMV. The platform boasts an impressive 120 million monthly active users, with a year-over-year growth rate of 29%. Furthermore, Meesho has maintained strong customer retention, with 85% of its users being repeat customers.
