Diwali dhamaka: How Amazon, Flipkart, Snapdeal are gearing up for festive sales

Amazon, the runner up in India’s e-commerce space, will host its annual five-day festive sale called The Great Indian Festival, a day ahead of rivals Flipkart and Snapdeal as it looks to outdo the competition with larger bigger discounts, faster delivery times and sweeter deals.

Retailers see the highest sales during the week of Diwali, helping several retailers rake in nearly half of their earnings in the October-December holiday quarter. For e-commerce players Flipkart, Snapdeal and Amazon, bets are on doubling or tripling sales during the five day period, compared to their average sales in an entire month.

“These marathon 120 hours of the event mark our continuing commitment to work closely with our partners and together bring the biggest sale yet for our customers, with the best ever shopping experience  powered by Prime,” said Amit Agarwal, Country Head of Amazon India, in a statement.

While Amazon will be looking at its Diwali sale as a way to grab even more market share away from rival Flipkart, the latter company says its major focus is to bring new shoppers online. By growing the market, claiming to have hit 100 million registered users earlier this week, Flipkart is confident that it can fend off a hungry Amazon.

The festive season sales could be among the most important for e-commerce marketplaces as it could reverse the slump in online buying witnessed all year long. According to research firm RedSeer, sales on e-commerce marketplaces fell by 19 per cent in the Jan-Mar quarter and fell by a further 5-10 per cent in the Apr-Jun quarter.

While it’s highly unlikely that Flipkart or Snapdeal try to outprice the much better funded Amazon, they’re instead looking at making it much easier for customers to afford large ticket purchases. Flipkart will use its no-cost EMI offer to bag as many smartphone, television and large appliance sales while Snapdeal is betting big on buyer upgrades with attractive exchange offers.

“In line with its positioning to offer upgraded options to its users, the sale will also provide pocket friendly exchange offers and convenient EMI options on electronics and mobile phones. Another special feature of the sale will be special Snapdeal Diwali packs curated by leading consumer brands,” Snapdeal said in a statement earlier this week.

Amazon, which has been chasing Flipkart’s tail in India for nearly two years now, might have surpassed the India firm in gross merchandise value during the months of June and July, but knows a successful festive sale could put it at a disadvantage once again. It plans to ensure staying ahead with not just the best prices, but also faster shipping and early access deals to have people sign up for Prime.

The US-based firm is offering same day, one-day and two day deliveries to customers even during the festive season sale, a time when order volumes being handled each day could be higher than what e-tailers usually handle in a month. Snapdeal, which according to RedSeer has industry leading delivery times, says it has hired 10,000 temporary logistics staff in order to handle the increase in orders.

“Price is not the only thing, it is about quality products made affordable,” said Binny Bansal in an interview with Business Standard on Wednesday. “We are confident that our value proposition and the delivery experience that we provide is going to be way ahead of anybody else.”

While it’s too early to put bets on who might emerge victorious after these sales, all e-commerce vendors are hoping the spike in sales seen during the festive season becomes the norm for next year. While festive sales are great to grab market share, e-commerce marketplaces are also looking at it as a way to grow the market.

With online sales growth remaining flat during the first half of this year, all players are expecting the market to return to normalcy in the coming weeks. Moreover, if Flipkart, Snapdeal and Amazon can pull off successful festive season sales, they could be setting the stage for an e-commerce market to grow to nearly three times its size next year.

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