Chennai: In a bid to reign supreme in the festive season sales, ecommerce players, who sold goods worth $2.3 billion (Rs 15,000 crore), burnt around $500 million on discount and cash-back offers during the past five days.
According to an initial RedSeer Consulting estimate, the festival season sales recorded 64 per cent growth to $2.3 billion from $1.4 billion last year in comparison to 43 per cent in 2017.
Industry sources estimated that ecommerce companies burnt around $500 million in discounts and cash-back offers this year, up from $300 million in 2017.
The cash burn-to-sales ratio, however is almost the same this year, indicating that the level of discounting remained the same despite the e-commerce market maturing by one more year, said industry insiders.
Ujjwal Chaudhry, engagement manager, e-tailing, RedSeer, said this year the entire sales was focused on market expansion.
“There are several new customers from smaller cities who have come on board. Companies offered EMI payment options, financing schemes, vernacular interface, private label etc in order to drive sales among new customers,” he said.
An increase in the number of tier II shoppers was one of the main reasons behind the growth of festival season sales this year.
RedSeer had estimated 20 million customers to shop during the five days of discount offer against 13 million shoppers last year.
According to Amazon, more than 82 per cent new customers came from smaller towns and cities. New customers through the Hindi website grew by 2.4 times over a normal business day and customers from 99 per cent of India’s serviceable pin codes have already placed an order on Amazon.in in the last four days.
“We have received an overwhelming response …, with sales in the first 36 hours nearly surpassing entire first wave last year and the event exceeding our most aggressive plans across all categories,” said Amit Agarwal, senior vice- president & country head, Amazon India.
For Amazon, almost 63 per cent orders for fashion products came from tier 2 and tier 3 cities. Fashion emerged as the biggest category in terms of units sold and new customers acquired. Women shoppers loved their shoe shopping 4.25 times jump over last year.
Smartphones too had their biggest season ever with Xiaomi selling over one million devices in a day, OnePlus with sales of over '400 crore in a day and premium phones sales exceeding a month of all India online sales.
Large appliances sales in a single day exceeded that of entire first wave for last festive sale with more than 50 per cent of sales coming from tier 2 and below.
New affordability schemes, bank and wallet offers were successful in converting the visitors to shoppers in large numbers.
Further, loyalty schemes and subscription services drove consumer delight through exclusive offers and early access and resulted in repeat buying, found RedSeer.
