While online discounts plummet, footfalls in malls soar

With discounts on the wane in shopping portals this season, business in malls and stores has seen a marginal increase. The first weekend this month (July 3 and 4) didn’t go too badly for malls. The Orion Mall in Bangalore did brisk business (about 15 percent more than that in the same period in 2015). Inorbit Mall in Mumbai recorded better footfalls of around 14 percent more than that of last year. The Infiniti Malls in Mumbai claimed to have seen 20 percent escalation in footfalls during the preview sales just before the weekend. However, nothing has been given out as to how much of all this has translated into sales.

What has changed this time is that the merchandise and discount levels are more or less the same across channels. Experts are of the opinion that shopping online had become more a function of convenience and less a function of discounts now. They also believe that consumers will not change their habits overnight simply because government policies have been reworked.

This is the first discount season after the government cracked down on deep discounts, disallowing e-commerce entities from directly or indirectly influencing the sale price of goods and services. The objective was to ensure a level-playing field with offline retailers who believed this would help boost their business. Most of them have left the duration of the sale unchanged at six weeks even though margins remain under pressure. Earlier this year, a report published by the BCG had reported that 59 percent of consumers shop online for factors other than discounts. Although leading e-retailers like myntra, amazon, flipkart continue to host sales, experts are of the view that the quantum of discounts has fallen. Experts aver that online marketplaces have largely discounted private labels as brands have more or less matched the discounts with those in stores.