Snapdeal, said to be one of the most prominent online shopping hub has been in the limelight as it faces a downfall. The question that arises is,How could a company which was worth billions of dollars have come to this sad pass? What went wrong?
Snapdeal was a promising company which had the advantage of being an early mover in a hot space. It had a great opportunity to change the way Indians shop because it was one of the first e-commerce players. This was a compelling new area, and by allowing small retailers to sell online, it offered them the proper ability to reach out to many more customers.
Hours after Snapdeal announced it was ending merger talks with Flipkart and going solo, many shareholders of the company are voicing out their concerns and have sent out emails regarding their disappointment with the deal being called off as a revolt.In an official statement on Monday, the Gurgaon-based online marketplace has also said it had, “decided to pursue an independent path and is terminating all strategic discussions as a result.” Snapdeal’s largest shareholder Softbank had initiated sale talks with much bigger competitor Flipkart and an offer of $850 million was being considered for the company.
Sources, say a large number of shareholders have already sent their emails to express their disappointment stating that the move to walk away from the deal “created no shareholder value.” Sources also added that this could be the start of shareholder activism and if there is enough momentum, there is a change the deal maybe back on the table.
The other news which came up was of the disappointing performance from the Snapdeal to one of the other client. PrimaSeller is an inventory and order management platform for merchants which allows them to manage their sales across multiple online and offline channel.
It serves as a retailer’s dashboard, by allowing them to restore their stock across many physical and online shops, so that they can sell on multiple different platforms, including Amazon, Flipkart and Snapdeal. However, Primaseller’s experience with Snapdeal was horrible one,because their APIs never worked properly, and they never respected their partners. The merchant was not able to sell efficiently and meet the expectations, and Primaseller had to face criticicm, for no fault of theirs.They finally gave up on the Snapdeal platform as a lost cause, but Snapdeal was always kept their problems confedential which they were having. Though they promised to fix these on a priority basis, but their technical debt got to such a point that they were never able to overhaul their ruptured system. The technology was never given the importance and attention that Amazon gives to its engineering.Many shareholders are not satisfied and unhappy with the experience.The latest development means there may come up some more drama and news in store on the Flipkart-Snapdeal saga.