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Sale Storm: E-commerce firms restart sales post new FDI norms


Just when everybody thought that e-commerce sales have been put on hold due to the new FDI norms, some online majors have restarted sale events, mostly betting big on the fashion category.

E-commerce Benchmark & Retail Report 2016

E-tailers have clarified that the brief lull in sales, followed by a resurgence, was not due to the new FDI rules. They say that discounts during promotional events are offered by their sellers and not them.

The Season of Sales

Last month, online fashion retailer concluded its two-day long biannual sale event, ‘End of Reason Sale‘ with a 23 times jump in its daily sales. The company recorded more than 37 million visits over the two days and 30 per cent of users were first-time buyers on the platform.

Flipkart too is considering major changes to its flagship sales event, Big Billion Day. According to a report, the event may be staggered throughout the month of October and the e-commerce behemoth may offer loans (buy-now–pay-later scheme) for customers.

This year’s event is highly critical for Flipkart in light of Amazon’s huge investment in India operations.

Paytm is also expected to spin off its online retail business by October, around the time Flipkart is planning its Big Billion Day. According to a news report, this is expected to be Alibaba’s e-commerce launchpad in India.

Meanwhile, India is back with its Great Indian Sale, a three-day sale heaven, starting August 8 to August 10. The e-commerce major is offering deals across product categories like electronics, clothing, accessories, musical instruments, books, shoes, etc.

The biggest change this time around with Amazon’s Great Indian Sale is the inclusion of Prime membership. Amazon recently announced Prime membership in India offers free fast delivery on every Amazon fulfilled order. The membership also offers unlimited free one-day and two-day delivery and free delivery on any order value. With Great Indian Sale, Amazon Prime members will be 30-minute given early access to best deals. Amazon had also announced that there will be Prime only deals this time around.

“We are excited to bring together a marathon of exciting blockbuster deals from thousands of brands and sellers across categories. Customers across the country can indulge in this shopping extravaganza by browsing through countless offers and fantastic deals on products of their choice with assured fast & reliable delivery. We are excited for Prime members who can access Prime only deals as well as get Early Access to other top deals 30 minutes prior to others. The Great Indian Sale will offer shoppers a delightful shopping experience at the best possible price points. As always, there will be something for everyone on Amazon.in,” Vice President Category Management, Amazon India, Manish Tiwary said.

Small Town Customers Go Big on Amazon Sale

Last month, Amazon India has announced its month long fashion sale, ‘End of Season Sale (EOSS) which pulled major traffic from Tier II and III towns and cities.

“There is a huge interest for our Fashion Store from smaller towns and cities. Customers in these cities are enjoying an easy and convenient access to international and Indian fashion brands unlike before. Close to 55 per cent of the orders are being received from cities outside of the eight metros,” Category Leader, Amazon Fashion India, Mayank Shivam told Indiaretailing then.

“Categories like apparel, comprising of T-shirts, shorts, sarees and ethnic wear, followed by shoes and jewelry are doing well on the platform,” he added.

Though Amazon didn’t disclose the incremental sales or first time users it achieved during the event, the company announced many ‘firsts’ on offer for its customers.

“Amazon Fashion’s EOSS offers, for the first time, dedicated brand days that will feature top fashion brands so customers can easily and seamlessly access the latest trends. With close to 40 international brands participating, the sale will also delight customers with fashion products that are exclusively available on Amazon Fashion with up to 70 per cent off,” Shivam said.

The FDI Conundrum

In March last year, the Government allowed 100 per cent foreign direct investment (FDI) in online retail of goods and services under the marketplace model but barred marketplaces from influencing pricing of products and services on their platforms, directly or indirectly. While this might have put few marketplaces to put sales on hold, Amazon said the sales on their platform are completely discounted by the brands.

“We are a marketplace, we don’t offer any discounts directly or indirectly to the consumers. These discounts are done by brands and sellers, we have no role to play in discounts on the platform,” asserted Shivam.

Similarly, last month’s Myntra sales were also discounted by the brands and sellers. Myntra Spokesperson said then, “The discounts offered on products during EORS are being offered by the brands themselves and not by Myntra.”