Online festive sales boom, delivery issues continue to haunt

While the festive season went off well for leading online retailers Flipkart, Amazon and Snapdeal, consumers continued to complain about cancelled or delayed orders and delivery issues. The mega sale events offering as much as 75 percent discounts, hosted by these platforms attracted hordes of customers however, they exposed online retailers’ inability to handle such rush.

Before really posing themselves as rivals to biggies like Amazon and Alibaba, Indian e-commerce players must learn to satisfy the end user by building their technological, warehousing, infrastructure, logistics and operations. If they don’t learn their lessons on time, they would find it difficult to stand against the likes of Amazon and Alibaba.

Time to retrospect and build efficiencies

First and foremost e-tailers will have to look into is fixing technical inefficiencies. Despite planning such mega-events for months prior to the actual season, they were not able to handle the huge number of customers, who were unable to buy what they wanted at the advertised price. While such technical hiccups are not uncommon, if the companies do not want to lose their reputation and customers, they must act fast. There are others eyeing to grab the larger pie of this prospering marketplace.

However, the biggest sales days in Indian online retail market, Flipkart and Snapdeal did manage to sell products worth an estimated Rs 600 crores despite customers expressing displeasure over technical glitches. As per Sandeep Komaravelly, senior VP, Marketing at Snapdeal sales in October more than doubled from September, and the company saw 250 percent growth month-on-month. He says in the past few months, Snapdeal has been growing at about 600 percent. While Flipkart claimed to have sold products worth over Rs 600 crores within 10 hours, Snapdeal said that its sales pegged at Rs one crore a minute, a figure similar to that of Flipkart.

Experts expect Snapdeal to touch gross merchandise sales of over Rs 700 crores in October, significantly higher than its sales of Rs 450-500 crores over the preceding three months. The company has crossed one billion dollars (over Rs 6,000 crores) in sales this fiscal. According to sources, Amazon India too was able to witness over-fourfold jump in transactions.

Demand to boost ecommerce

With capital reservoir of Flipkart, Myntra is also aiming to achieve one billion dollars (over Rs 6,000 crores) gross merchandise value in 2016. To reach its goal, the platform would join hands with 20 brands to launch their product lines exclusively on its platform in October. The company has tied up with brands like Puma, Vero Moda, Jack and Jones, Biba, Lee and Wrangler, among others, to launch over 1,000 styles around the festive season to attract eyeballs and increase sales.

With Flipkart raising 1 billion dollars (over Rs 6,000 crores) through the latest funding round and Amazon.com announcing another investment of 2 billion dollars (over 12,000 crores) in India, the third leading Indian marketplace Snapdeal.com, got much required capital dose from none other than Ratan Tata. No wonder, these companies are going all out to grab a larger pie of the lucrative e-commerce market. Festive season, ending with the holiday season in December, would be the best time to them to cash in on the opportunity by investing in new styles, fresh appeal, prompt service, private fashion brands as well as foreign fashion labels.