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Indian e-commerce companies had record-breaking festive sales—again

By Durba Ghosh

Like in the past several years, e-commerce companies in India broke many records during the festive season sales this time, too.

In October and November, online retailers in the country sold goods worth $4.3 billion (Rs29,947 crore), 43% higher than the $3 billion last year, consultancy firm RedSeer said.

During the same period, Indian shoppers spent a whopping Rs15,300 crore ($2 billion) during discount events hosted by marketplaces like Flipkart, Amazon, Paytm Mall, and others, according to estimates by financial services firm Visa. This was 37% higher than last year.

The online festive sale season in India typically begins with the Hindu festival of Dussehra (which was in October this year) and peaks around Diwali (celebrated in November this time).

The festive months account for around 40% of the annual sales of clothes, electronics, automobiles, and household items in the country. “While the average spend was 1.48 times more than that during a normal week, it doubled (to Rs2,900 crores) on Dhanteras, which was on Nov. 05,” Visa said in a report. “This could also be seen from a 2.9 times increase in the spending on jewellery during the week, compared to a normal week.”

This year, an estimated 20 million or more shoppers were expected to make online purchases during the festive season, and e-tailers were ready for them with hefty discounts, easy payment options, and speedy delivery.

Who performed how

Like in several previous years, both Flipkart and Amazon declared themselves winners in key categories like smartphones, fashion, and large appliances. Each also proclaimed itself as India’s biggest online marketplace.

While it is difficult to ascertain their claims since the companies share limited data, estimates say they both did benefit greatly.

The country’s largest homegrown e-commerce player, Flipkart, ran its flagship Big Billion Day (BBD) discount from Oct. 10 to Oct. 14. The Bengaluru-based company said its gross merchandise value (GMV, or the total value of goods sold through a marketplace) during the sales rose 90% over the last year.

On the other hand, the Indian arm of the world’s largest online retailer, Amazon, ran its Great Indian Shopping Festival in two tranches: Oct. 10 to Oct. 15 and Oct. 24 to Oct 28. The company said its GMV during this year’s sale was 70% higher than last year’s.

The sales exceeded the company’s “most ambitious plans across all dimensions in terms of new customer growth, unit sales and in terms of gross merchandise,” said Amazon India country head Amit Agarwal.

As per estimates from Forrester Research, Flipkart clocked close to $1 billion in gross sales during the festive sale. Amazon India earned $800-900 million during the same period, according to RedSeer’s estimates.

Paytm Mall, an e-commerce unicorn owned by India’s largest digital payments firm, also saw a three-fold jump in transactions. The company received 50 million shoppers during its sale between Oct. 09 and Oct. 12, which contributed to an over 30% increase in GMV.

Smart about smartphones

Smartphones, which account for over 50% of all e-commerce sales in India, remained the largest selling category this festive season, too, with nearly $800 million worth sold in the first two days of the five-day sale during Diwali, according to RedSeer.

“This was mainly due to a greater number of attractive exclusive smartphones over last year on these platforms, backed up with offers and lucrative deals,” Karn Chauhan, research analyst at Counterpoint said. “Flipkart stood out due to the most number of exclusives while Amazon benefitted some from the launch of OnePlus 6T.”

Flipkart had 27 models that it sold exclusively, while Amazon had 15.

Amazon’s exclusive launches of OnePlus 6 and Redmi 6A were the most selling products for the platform in the smartphone category. Xiaomi phones on Amazon registered a 200% growth over last year, while 100% more OnePlus phones, too, were sold.

Flipkart said it sold over 3 million smartphone units on the first day of its BBD sale. The company had bagged an exclusive deal to launch the OPPO F3 Plus on its platform.

Apart from heavy discounts on smartphones and electronics, the introduction of EMIs on debit cards and easy credit facilities also helped the companies post record sales this festive season, according to analysts.

Both Amazon and Flipkart lined up instant credit in the range of about Rs30,000-Rs60,000 to boost the purchasing power of consumers who end up discarding their carts in absence of adequate capital for large purchases. The easy financing options for buyers helped both the companies widen the market to cities and towns beyond metros.