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There’s only one thing Indian online shoppers are loyal to: discounts

Traffic moves on a road past advertisements of Indian online marketplace Amazon, in Mumbai, India
Reuters/Shailesh Andrade
A sparkling time for e-commerce companies.
  • Ananya Bhattacharya
By Ananya Bhattacharya

Tech reporter

Published This article is more than 2 years old.

Amazon and Flipkart have been spending millions of dollars on marketing and brand-building. But that hardly seems to impress Indian shoppers.

Yet again, the online retail war in India this festive season will be fought over price tags.

Nearly 60% respondents in a recent survey said their online shopping decisions during the upcoming festive season will depend on which website offers better deals. For 32% of the respondents, the decision will be based on which portal offers lower prices.

“Our study showed that Indian consumers, like most consumers, are value-conscious and often shop around for the lowest prices and best deals,” Nathan Eagle, CEO of free internet provider Jana, told Quartz. Jana surveyed around 1,900 mCent browser-users between Sept. 24 and Oct. 01 this year.

The festive shopping season in India begins with Dussehra in October and lasts three months till Christmas. Indian retailers register about 40% of their annual sales of clothes, electronics, automobiles, and household items during this period. This season, the e-commerce industry is targeting $3 billion in sales overall.

Indians may not be loyal to any one brand, but they are completely sold on online shopping.

Jana’s survey showed that 84% were aware of this month’s Flipkart Big Billion Sale and the Amazon Great Indian Festival. Nearly eight in 10 plan to shop during either of these periods.

“We expect another huge, if not (a) record-breaking year, which should easily rival last year. This is thanks to big discounts on products and special offers by both Amazon and Flipkart, as well as the billions of dollars each are spending on advertising and promotions, as well as delivery and infrastructure improvements,” Eagle said.

The big battle

This will be the first festive season after Walmart made its big-bang acquisition of Flipkart in May this year to take on Amazon.

Both giants are out all guns blazing, splurging big bucks.

Amazon is reportedly beefing up its payments arm with a Rs590 crore ($80 million) investment, besides other things. On the other hand, Flipkart is eyeing sales of between $1.5 billion and $1.7 billion—nearly double of last year.

But Indians seem to have one favourite already.

Nearly half of the respondents said they’d pick Flipkart, while only 40.6% chose Amazon. Smaller players like Myntra, Snapdeal, and Shopclues together captured less than 10%.

What are Indians buying?

Electronics are the most popular choice.

Large appliances, though, are a sliver of the expected overall sales. That’s unfortunate for Flipkart, which forged exclusive partnerships with Blaupunkt and Xiaomi, expecting to log a 2.5X jump in large appliance sales, Jana reveals. And even among those who will buy a large appliance, nearly 50% said that purchase would be made on Amazon. Less than 40% would consider buying the large home goods on Flipkart.

Among the small share buying home appliances, TVs are the most sought-after.

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