Saturday 28 September 2019

Cracker of a start: Flipkart, Amazon's opening day festive sales surpass estimates

Cracker of a start: Flipkart, Amazon's opening day festive sales surpass estimatesBengaluru: India’s two largest ecommerce companies, Flipkart and Amazon, said that opening day festive sales have surpassed estimates, primarily boosted by new product launches, steep discounts, and loans and bank offers luring customers from smaller towns and cities to buy online.

Data shared by both marketplaces indicate that most of these shoppers used financial affordability constructs like EMI or product exchange offers to make purchases, especially on electronics.

According to Flipkart, customers opting for affordability options spent 2.5 times more than other customers, while Amazon said it witnessed a 100% growth in customers opting for EMIs, of which 75% were from smaller towns and cities. Over a third of electronics on Amazon were purchased under product exchange programmes, while three out of four customers availed no-cost EMI offers, the company said.

Cracker of a start: Flipkart, Amazon's opening day festive sales surpass estimates

Experts said that owing to the slew of offers from banks and affordable EMI constructs, users from smaller towns and cities, who were otherwise holding back purchases, especially at full-price, due to the country’s sluggish consumer sentiment, look at these festival sales to buy products.

“Our penetration keeps going up every year. Fashion grew five times over last year and attracted the most new customers, followed by smartphones,” said Amit Agarwal, global senior vice-president, Amazon India.

Top three premium smartphone brands Samsung, OnePlus and Apple accounted for Rs 750 crore in sales in one day, while Amazon’s own product Echo Dot was the most sold product on the site.

The domestic online retail players though is collectively expected to clock almost $4.8 billion in sales during the entire festive period, as per Forrester research.

“There is no doubt that ecommerce has not lifted consumer sentiment,” said Kalyan Krishnamurthy, Group CEO, Flipkart.

The number of transacting customers from Tier-2 and beyond have doubled over last year sale period, the company said, adding that travel has emerged as the fastest-growing category on Flipkart.

ETcould not independently verify the authenticity of the numbers shared by etailers. However, three brands that ET spoke to indicate a spike in orders. “We overshot our sales estimates on both marketplaces (Amazon and Flipkart), witnessing a 7X spike in order volumes,” said Manish Chowdhary, CEO, Wow Skin Care.

“Early data shows this was a mix of our loyal customer base who purchased routine products plus tried out new launches, and new customers who bought our flagship product range,” he said.

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