Market research firm Forrester had said that for the first week ecommerce sales on platforms like Flipkart, Amazon India and others — including new entrants such as Reliance Industries’ JioMart —
would be around $6.5 billion in gross merchandise value, and that the overall festive month would notch up as much as $9.2 billion. RedSeer Consulting had also predicted GMV of $9 billion for the festive month (October3-November 3).
GMV in e-commerce refers to the total value of sales on a platform during a given period, including discounts but excluding returns.
The first-week GMV may have lagged due to
last-minute changes to sale dates, which meant sales started during the Hindu calendar’s ‘Shradh’ month, which is considered inauspicious for making purchases, industry executives, analysts and logistics experts said. But etailers can still make up for that in the next two sale events before Diwali, which could take the daily shipment volumes to about 9 million, compared with more than 6 million last year, industry players said.
“Ecommerce sales have grown in good double digits compared with last year but perhaps not as much as expected by the industry initially this year,” said TA Krishnan, cofounder of Ecom Express, an ecommerce-focused delivery firm. “The sales starting during Shradh was one factor which would have played a role in this along with the fact that overall availability of new smartphone launches was limited
due to the chip-shortage issue,”
ET reported last month how Walmart-owned Flipkart and Amazon India
made back-to-back changes to their sale dates over a weekend so they were not left behind in starting the sales. ET also reported that the chip shortage issue had spilled over to segments like smartphones, large-screen TVs and laptops, affecting their supplies.
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Krishnan, who is also Ecom Express’ chief executive, said the next two sale cycles before Diwali would still be able to add to the current momentum and daily shipments can hit 9-10 million.
While this is a big number, players like Meesho and DealShare expanding their operations to non-metro markets to deliver groceries is adding to the growth in ecommerce volumes. The Tata Group and Reliance Industries are also holding online sale events, but they still have a relatively smaller share, industry executives said.
RedSeer on Saturday said gross sales between October 2 and October 5 (the early access period for premium subscribers on Flipkart and Amazon) were around $2.7 billion and on track to hit earlier estimates of $4.8 billion in the first week of sales. The estimate includes sales on social commerce platforms and grocery deliveries.
While smartphones remain one of the biggest sales drivers on ecommerce platforms during the Diwali sales, there has been relatively fewer number of device launches this time due to supply-side issues. For instance, the newly launched iPhone13 was unavailable on Flipkart and Amazon India after the first set of devices were sold out. Apple, though, is selling the device on its India ecommerce platform.
Smartphones typically contribute more than half the total gross sales in online shopping.
Jitender Miglani, a senior forecast analyst at Forrester, said many large-ticket purchases were fuelled by options like exchanging the existing products as well as financing deals, such as
‘buy now pay later’. “The trends have been good so far. Grocery sales are expected to further pick up in the final sale before Diwali next month,” he said, adding that it would take at least a few weeks for the research firm to come out with data on what kind of sales etailers have achieved compared with estimates.
A report from Unicommerce, an ecommerce solutions provider, last week said order volume for fast-moving consumer goods (FMCG) was up by 74% during the first eight months of 2021 compared with the same period of last year.
While the Shradh period seems to have had an effect, a leading wearables firm’s founder said the company had recorded two times more sales than last year in the first week of the flagship sales. “There are still at least two more sale events planned and that should do well,” said this person, who leads one of the prominent homegrown direct-to-consumer brands in the wearables space.
Ambitious expectations from etailers for the festive sale came on the back of a gradual recovery in sales after the second wave of the pandemic. It accelerated in the run up to the festive sales like Big Billion Days and Great Indian Festival.
ET, citing industry sources, reported last month that the Flipkart Group, including Myntra,
was on track to record over 50% growth in gross sales at $23 billion this calendar year. A report from consultancy firm Bain & Co. said the overall industry would grow more than 30% to over $50 billion in GMV this fiscal year. According to it, GMV in FY21 at $38 billion had grown 25% from the previous year.
“Tier 3 and 4 markets are playing a critical role in the overall recovery in consumer spending and consumers are more conscious of issues like the Shradh,” a senior logistics executive said.