Online players’ festive sale events succeed in pulling crowds

After failing to cash in on the opportunity around the festive season last year, all the three leading ecommerce players – Flipkart, Amazon and Snapdeal are said to be witnessing a bumper opening to their sale events. While Amazon India’s 'The Great Indian Festive Sale' began yesterday, even Flipkart's 'Big Billion Days' and Snapdeal's 'Diwali Sale' kicked-off with customers rushing in to grab the deals on offer.

Opening day sales - a bonanza for all

Amazon India said that the first day of the sale event was the biggest sales day for the company since it was two times bigger than the ‘The Great Indian Freedom Sale’ and four times bigger than the peak season around last Diwali. Flipkart, on the other hand, which was heavily criticised for its inability to handle the crows last year, claims to have sold 10 lakh products on October 13, 2015 in the first 10 hours of 'The Big Billion Days' five-day sale event. The highest traffic on the Flipkart website was drawn from cities like Bengaluru, Delhi and Chennai along with Tier II towns such as Ludhiana, Lucknow and Bhopal.

Amazon saw 70 percent of the customer shopping on their mobile app with new customers signing in from cities like Aurangabad, Malappuram, Dhanbad, Kannur, Tiruchirappalli, Jamshedpur, among others. And Snapdeal, which announced ‘Electronics Monday Sale’ on October 12, 2015, also saw sales exceed expectation with an enthusiastic response from customers across the country, with the company close to crossing 100 million dollars (Rs 650 crores) in sales by end of that day.

These ecommerce firms also invested in marketing initiatives like full page print advertisements in many leading newspapers on Tuesday to announce their respective mega sale events. As per the Associated Chambers of Commerce and Industry of India (Assocham) report, consumers are expected to splurge about Rs 52,000 crores on shopping during this festive season that began with Navaratra yesterday and will go on till Christmas. “Despite economic slowdown, the online shopping marts are expecting to rake in as much as 40-45 percent more in sales during the festive season,” the report said. Considering the current trend, Assocham also expects a five-fold rise in revenue generation of ecommerce sites this year as compared to the previous year.

No eye-popping discounts this festive season

However, moving away from their earlier strategy on wooing customers with heavy discounts, online retailer focused on better financials this time as race to be the first ecommerce firm to turn profitable deepens. While the ecommerce companies offered maximum discounts on their in-house apparel brands where margins are double compared to clothing of other brands, fresh merchandise was also kept away from the discount strategies.

Ecommerce platforms have so far been banking upon heavy discounts and offers to attract customers and keep the businesses running. However, they are realising that the same strategy is holding them from making profits. Electronic marketplaces decided to depend on category-specific discounts, new product launches and cashback schemes to drive sales and growth.

Snapdeal's preview Diwali sale was an indicator of the trend that would be followed by online marketplaces around Diwali this year. While steepest discounts were offered in categories such as home and fashion; cashback schemes were a part of its recently acquired digital payments platform Freecharge, and the home page showcased exclusive deals on specific brands. On an average, discounts offered by online retailers are witnessing a drop to 15-20 percent this year from 25 percent in 2014, and is expected to witness a further decline to 10-15 percent next year, as per the recent India Infoline report.