Snapdeal cuts marketplace monetisation 13 points for lower prices

Snapdeal cut marketplace monetisation, measured as revenue from operations as a share of net merchandise value (NMV), by 13.06 percentage points to 26.87% in Financial Year 2026 from 39.93% in Financial Year 2024. Snapdeal says its zero-commission model reduces sellers’ costs so they can offer lower customer prices.

Why did Snapdeal cut marketplace monetisation by 13 percentage points?

Snapdeal cut marketplace monetisation to support a price-led proposition for value shoppers rather than maximise revenue retained from each sale. NMV is the value of marketplace sales after returns, and revenue from operations as a percentage of NMV shows the share of that post-return value recognised as marketplace revenue. The ratio fell from 39.93% in Financial Year 2024 to 28.74% in Financial Year 2025 and 26.87% in Financial Year 2026.

Snapdeal attributes the 13.06-percentage-point reduction to its zero-commission model. The company’s stated mechanism is that lower costs of doing business allow sellers to pass benefits to customers through more attractive pricing. The target market is evident in Financial Year 2026 delivery data: 83.75% of delivered units had price points below Rs 599, while non-metro cities accounted for 82.22% of delivered units.

The lower monetisation ratio coincided with faster growth in NMV than in marketplace revenue. NMV rose 72.60% from Rs 633.34 crore in Financial Year 2024 to Rs 1,093.11 crore in Financial Year 2026. Marketplace revenue increased 16.13% over the same period, from Rs 252.89 crore to Rs 293.68 crore, showing the trade-off between scale and the revenue share retained by Snapdeal.

How did lower monetisation change Snapdeal’s marketplace economics?

Snapdeal’s lower marketplace monetisation reduced contribution margin as a share of NMV, although contribution margin per delivered unit remained positive in each of the three financial years. Contribution margin is marketplace revenue from operations less marketplace logistics expense. It declined from 22.94% of NMV in Financial Year 2024 to 12.77% in Financial Year 2025 and 10.01% in Financial Year 2026.

In Financial Year 2026, Snapdeal reported Rs 113.04 of marketplace revenue per delivered unit and Rs 70.90 of logistics expense per delivered unit, producing a contribution margin of Rs 42.14 per unit. Logistics expense per unit was Rs 69.72 in Financial Year 2025 and Rs 72.62 in Financial Year 2024. Snapdeal uses third-party logistics providers, or 3PLs, and its courier allocation engine selects a provider based on cost, delivery speed and past performance.

The marketplace did not report positive adjusted earnings before interest, taxes, depreciation and amortisation, or adjusted EBITDA, during this period. Its adjusted EBITDA loss increased in rupee terms from Rs 36.72 crore in Financial Year 2024 to Rs 50.25 crore in Financial Year 2026. However, the loss narrowed as a share of NMV from 5.80% to 4.60%, because NMV expanded faster than the loss over the two-year comparison.

Which costs offset Snapdeal’s lower marketplace monetisation?

Snapdeal reported that marketing and business promotion, hosting and software, and all other marketplace expenses together fell by 14.13 percentage points of NMV from Financial Year 2024 to Financial Year 2026. That reduction exceeded the 13.06-percentage-point fall in marketplace revenue as a share of NMV, helping adjusted EBITDA margin improve despite reduced monetisation.

Marketing and business promotion expense fell from 9.24% of NMV in Financial Year 2024 to 7.72% in Financial Year 2026, although the rupee expense rose to Rs 84.40 crore from Rs 58.55 crore as volumes grew. Hosting and software costs combined declined from 3.20% to 1.75% of NMV, while all other expenses dropped from 16.29% to 5.14%. Snapdeal identifies other expenses as primarily fixed in nature, making their share of NMV sensitive to transaction scale.

Logistics did not show the same full-period decline. Marketplace logistics expense was 16.99% of NMV in Financial Year 2024, 15.97% in Financial Year 2025 and 16.85% in Financial Year 2026. Snapdeal delivered 25.98 million units in Financial Year 2026 and says its shipment scale supports 3PL cost alignment, but the lower-price model depends on maintaining that cost control as unit volumes rise.

What volume evidence supports Snapdeal’s lower-price strategy?

Snapdeal’s customer data show a larger user base alongside its lower marketplace monetisation. Total customers served increased 54.90% to 12.16 million in Financial Year 2026 from 7.85 million in Financial Year 2024. The measure counts customers identified by a unique mobile number to whom at least one unit was shipped during the reporting year.

Repeat customers rose from 5.44 million in Financial Year 2024 to 8.47 million in Financial Year 2026, representing 69.65% of total customers served. Delivered units from repeat customers accounted for 82.91% of all delivered units in Financial Year 2026, compared with 81.09% in Financial Year 2025. Snapdeal said such units grew 33.38% in Financial Year 2026, after 31.69% growth in Financial Year 2025.

The mobile app became a more important order channel during the same period. Its share of delivered units rose to 89.83% in Financial Year 2026 from 66.12% in Financial Year 2024, and 99.72% of delivered units were purchased through either the mobile app or mobile website in Financial Year 2026. Snapdeal says app usage supports retargeting and contextual notifications, although marketing expense per delivered unit increased by Rs 0.76 to Rs 32.49 in Financial Year 2026.

What must happen for Snapdeal’s model to improve profitability?

Snapdeal’s model requires additional delivered units to expand margin without a proportionate rise in fixed costs. The company says an incremental share of margin from each additional unit can contribute to the bottom line when fixed costs do not increase commensurately. All other expenses were Rs 56.18 crore in Financial Year 2026, down from Rs 103.20 crore in Financial Year 2024 while NMV increased by Rs 459.77 crore.

The model also requires stable fulfilment costs, product quality and sales after returns. As of March 31, 2026, Snapdeal’s courier allocation engine used a monthly average of 63.82 million data points to select 3PL partners. Higher logistics costs per unit, weaker seller quality or more returned sales would affect NMV, contribution margin and the pricing proposition that underpins the zero-commission approach.

Snapdeal’s disclosed plan is to deepen its value lifestyle e-commerce presence through wider assortment, affordable pricing, product quality and customer experience. It also intends to expand its predominantly small and medium enterprise seller network and refine cost structures so savings can translate into competitive customer prices. The disclosure presents scale and cost efficiency, rather than a reversal of lower marketplace monetisation, as the route to improved profitability.

Conclusion

Snapdeal reduced marketplace monetisation by 13.06 percentage points of NMV as it pursued a zero-commission, lower-price strategy. The approach accompanied NMV growth from Rs 633.34 crore in Financial Year 2024 to Rs 1,093.11 crore in Financial Year 2026, while adjusted EBITDA loss narrowed from 5.80% to 4.60% of NMV despite remaining negative.

The next measure to watch is whether Snapdeal’s planned seller expansion, cost refinement and app-led customer growth can sustain unit growth without material logistics inflation. Financial Year 2026 logistics expense of Rs 70.90 per delivered unit and contribution margin of Rs 42.14 per delivered unit provide disclosed operating measures for that progression.