Flipkart claims Amazon’s sale played a part in boosting its own

Online marketplaces saw a dip in sales last year due to the introduction of 100% foreign direct investment. which forced them to limit discounts and demonetisation, which brought down their COD orders. The road has been rough for etailers, but with the dawn of 2017 they expect better outcomes.

The difficulties of 2016 haven’t stopped etailers from hosting sales. In fact, Amazon just completed its 3 day Great Indian Sale from the 20th to the 22nd of January. The sale encouraged more from Tier III cities to buy from Amazon. As a result, the foreign etailer saw a 200% rise in growth.

Just a day after Amazon, Flipkart launched its own three-day Republic sale from the 24th to the 26th of January. The etailer said it wouldn’t be spending much on above the line or ATL advertising on TV and in print.

• The first reason being its conscious decision to rationalise spending.
• The second is the fact that Amazon’s sale already helped push their topline because they have more attractive offers.

A director at Flipkart, Smrithi Ravichandran said, “Because of the sale by rival marketplace, we saw a surge of 2.5 times on our platform over regular days for specific categories such as large electronics like TV, washing machine and smartwatches in the gadgets category between January 20-22. We flashed a few good discounts on this during the sale period.”

During the Republic Day sale, discounts will be available for categories like mobiles, lifestyle categories and women’s apparel. Flipkart’s in-house brand Flipkart Smart Buy and brands introduced during Diwali are participating in the sale, Smrithi added.

Flipkart reduces spends on marketing

Flipkart is making losses like other marketplaces and one of the reasons for this was its heavy expenditure on advertising. However, this time round the marketplace has cut down this expense. Smrithi stated that the online marketplace spent far less on promotions. In fact, it concentrated more on social media promotions and digital promotions compared to ATL ads.

She mentioned, “We spent one-fourth on marketing as compared to rivals during the Big Billion Days sale. We are focused on ensuring how can we spend less on this and pass on the benefits to the consumers.”