India’s burgeoning online shopping market topped Rs 9,000 crore ($1.5 billion) in sales during the five-day period that ended on September 24, thanks to huge deals and discounts offered by leading e-tailers. Online sales grew by over 40 per cent from the $1.05 billion generated during the festive sale days in 2016 and more than doubled compared to the 2015 edition.
According to market analyst RedSeer Management Consulting, the Flipkart group dominated this year’s sale with a gross merchandise value of Rs 5,200 crore, helping it corner 58 per cent of the online retail market. Rival Amazon, on the other hand, saw less than half that at 26 per cent.
“Driven by their sharp advertising, robust offers and great execution, e-tailers have managed to largely match their pre-sales expectations and deliver the biggest sale period ever for e-tailing industry,” said Anil Kumar, chief executive of RedSeer.
While Flipkart managed to grow its market share from 50 per cent last year to 58 per cent this year, Amazon saw a dip in its share from 32 per cent to 26 per cent. Other retailers, including Snapdeal, Paytm Mall and ShopClues, made up the remainder 16 per cent of sales during the five days.
RedSeer said the success of this year’s sales came on the back of higher awareness of consumers, great discounts and better delivery. RedSeer states that Flipkart had a 92 per cent brand recall among consumers before the 2017 festive sales period, helping it deliver a huge blow to Amazon.
It was during its Big Billion Days sale last year that Flipkart was able to kick-start its stalled growth engine and maintain its lead over a much faster-growing Amazon. This year, armed with a war chest of $4 billion, it has clawed back some of the market.
RedSeer said its estimates were done using an integrated research approach where it surveyed over 9,000 customers, 1,000 sellers and through its tie-up with online deals websites was able to gather over 100,000 data points.
In an interview with Business Standard, Kalyan Krishnamurthy, chief executive of Flipkart, had said the company had figured out a way to grow without burning money.
“What we have been able to do in the last year is find a very good way to expand the market, get into new product constructs, innovate, all without actually burning money. We will not just start spending money in an irresponsible way, we are very clear about that,” said Krishnamurthy.