Here’s Why Flipkart Launched Its Own Video Streaming Service

In what seems to be a strange move, Flipkart recently announced a new video streaming service that has already been made available for its Android app since. This new free streaming service is integrated right into the shopping application and doesn’t come in a separate app like Amazon’s Prime Video does.

But despite what it seems, this new service was not launched to directly lock horns with Prime Video and participate in a duel to be one of the country’s leading OTT services. In fact, this is what Flipkart might call a strategic move in a game that is bigger than just OTT services. And the path it’s taking, it eventually hopes, will help it grab a bigger slice of the evergrowing e-Commerce pie.

Flipkart has set its eyes on the next 200 million users who hail from Tier II and Tier III cities and will connect to the internet. It is those eyeballs that Flipkart is after more than the existing set that already has access to its services and are connected.

What better way to capture the eyeballs of this cohort than offering free media content? In India currently, most OTT services operate on either a subscription service or a freemium model. But Flipkart isn't interested in either. Instead, it wants to give every idle and eager set of eyes completely free content to watch.

SEE ALSO: Netflix Introduces Mobile-Only Subscription Plan For Rs 199 in India

But how does Flipkart benefit if it won't charge users?

Well, in short, Flipkart thinks that this will eventually increase the loyalty of these newbies and existing customers to the brand and they will be more inclined to make a purchase on their online store.

Amazon's Prime subscription service took exactly the opposite route. Instead of opting for delayed (monetary) gratification, it chose to launch a paid subscription service that would offer a lot of bang for one’s buck. According to a report by research firm RedSeer, about 50% of Amazon Prime subscribers primarily paid for the service to access content via Prime Video. And since they had already paid the money for the service, they would now seek to get more from the fees by making use of Prime’s faster delivery services or any of the other perks that the subscription offered. This generated loyalty of Prime subscribers towards Amazon and its services. Amazon has been vocal about how its Prime subscribers yield almost double the revenue of its non-Prime subscribers.

But Flipkart doesn't want to charge the audience before the circus act has started. Instead, it wants them to enjoy the show the first and then eventually hope that they shell out money for its services and offerings.

By offering a free streaming service it wants to increase its brand awareness and let the name seep into the minds of these impressionable consumers. It then wants to use this brand recall to erase the stigma against online shopping and hope that they eventually give in to the online shopping revolution and add to Flipkart's bottom line.

Flipkart, very cleverly, has hidden the video streaming service in the Flipkart menu list. This subconscious marketing also cannot be underestimated in influencing the behaviour of these new consumers.

Another thing Flipkart could gain from this streaming service is dearths of data regarding consumer behaviour and patterns. This information could, in turn, be studied to improve the Indian e-Commerce company's services and offerings.

So, while this might seem like a strange move at first, this could be the golden egg that Flipkart has been waiting to lay. But if this plan will hatch or not, only time will tell. For now, it's three major hurdles will be attracting eyeballs, curating content and harnessing the attention it gets to generate more revenue.

Cover Artwork by Dhawal Bhanushali | Mashable India