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Abhinav Singh
Abhinav Singh


The level of discounts offered by e-commerce players scores less this season


Though a fierce discount war is currently underway between the top e-commerce players such as Amazon, Flipkart and Snapdeal in India, the level of discounts which are being offered by them scores a little less when compared with last year. Even the marketing of these discount offers has been found more on the digital media and a little less in the conventional media this year. This has been observed by some of the experts who track the e-commerce industry in India. One more aspect on the discount sales has been that the discounts are not mainly restricted to mobile or electronic products, but they are being offered in well-spread out categories such as the home decor and furniture too.

“The level of discounts on many products are on parity with what is being offered at the offline stores. The level of discounts is less on popular brands, such that you could get the same level of discount or perhaps even more at a retail store. The discounts are also very low on newly launched products. It was not the case in the last few years, as the e-commerce players used to offer heavy discounts on those products which would attract more and more buyers to their sites. This shows that the market is moving more towards maturity and consolidation, and only a few top players would be left in the e-commerce fray. In a way it is good for the market as the players are now focusing more on profitability,” explained Alok Shende of Mumbai-based Ascentius Consulting.

It is a well-known fact that the discount days are the days when most of the e-commerce companies make their money and it is very crucial for them. There have been reports that the government is observing the discounts being offered by the e-commerce players but experts say that this may not be a deterrent for them and they will continue with their discount offers in the holiday season. “The top e-commerce players in India garner around 35 percent of their GMV (gross merchandise volume) during the three months of Oct-Dec as most of their sales happen during this period. At this juncture, it is very difficult to predict as to who will win the war as most of them have exclusive deals with different vendors. I have observed that there has been a slight dip in their spends on marketing and advertising for such offers. Only after the whole discount season is over would we be in a position to say which company has excelled,” remarked Mrigank Gutgutia, engagement manager, RedSeer Consulting.

However, it is the digital media which is scoring on the advertising front for these discount offers as most of the e-commerce companies want to attract online tech-savvy individuals. “Though it is difficult to track the response on the conventional media, it is easy for these e-commerce companies to track digital advertising. Since these are e-commerce companies, online medium is a better way for them to reach their target customers. However, I have observed that many of these e-commerce companies fail to get repeat business and they need to do something about it,” said Shende.

Claims about success by different e-commerce companies have already started coming in as Snapdeal, for instance, claims that more than 11 lakh buyers shopped on its site in the first 16 hours of its 'Unbox Diwali' sale which is on till the October 6. The company says that the sale had buyers from over 2800 cities and towns across India. “We have seen consistent growth across all categories, with overall six times increase in volumes as compared with usual days. We are confident of setting new benchmarks this Diwali,” said Saurabh Bansal, vice president and head category management at Snapdeal. 

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