Your browser is currently blocking notification.
Please follow this instruction to subscribe:
X
Notifications are already enabled.
X

India’s Tier 2, 3 Shoppers Help Amazon, Flipkart Beat Slowdown Blues As Festive Sales Open

India’s Tier 2, 3 Shoppers Help Amazon, Flipkart Beat Slowdown Blues As Festive Sales Open

Amazon witnessed 66% of Prime members shopping in 24 hours from Tier 2 and 3 towns

Flipkart said the number of customers from Tier 2 cities and smaller towns doubled compared to last year

Despite the success of day one of the sales, India still lags China and the US in festive sale ecommerce revenue

India’s ecommerce giants, Amazon and Walmart-backed Flipkart, are in the middle of a flagship festive sale battle. And each year, the companies outpace their own sales records. Both platforms have claimed record sales on the first day of sales this year as well, with a unique trend emerging this year. This year’s festive sales have gone beyond metros and grabbed eyeballs of Tier 2, 3 cities and smaller towns.

Amazon said its Great Indian Festival saw the largest single-day Prime subscriptions, with 66% of Prime members shopping in 24 hours coming from Tier 2 and 3 towns. Flipkart’s Big Billion Days or BBD also saw double the number of transacting customers from Tier 2 and smaller cities as compared to last year.

“More customers shopped on Amazon.in than ever before, with 91% of new customers coming from tier 2 & 3 towns,” according to a press statement from Amazon.

“We started this festive season by setting audacious targets. By all indications this is going to be the biggest festive season that India has witnessed,” said CEO of Flipkart Kalyan Krishnamurthy.

Both marketplaces have been focussing on small towns in preparation for the festive sales, as evident through new localisation features and new fulfilment centres being opened across the country.

Cashback, EMIs Offer Festive Sale Push For ‘Bharat’

To cater to Tier 2 and Tier 3 India or ‘Bharat’ as it is called these days, the companies launched initiatives such as Flipkart’s no-cost EMI for shoppers who do not have credit cards and Amazon’s Project Udaan, under which the company had partnered with small stores like StoreKing and Vakrangee where shopkeepers helpes customers shop online in rural areas.

More than 400 million Indians had access to cashback and EMI offers on Amazon, the company claimed, with 100% more customers opting for EMI as compared to last year. What’s more 75% of these EMI shoppers came from Tier 2 and 3 cities.

These offers led to Amazon Karigar witnessing a huge spike in sales. This was the first time Amazon showcased a huge array of products from emerging small & medium businesses (SMBs) and startups and over 55K artisan products across more than 270 unique arts and crafts products from 20 states.

Over 42,500 sellers received at least one customer order (23% higher than last year) in the first 36 hours of the sale making this the largest number of such sellers than ever before, the US tech giant said. Over 2500 sellers recorded their highest ever sale on a single day. “With record Prime signups, more first-time shoppers from small towns than ever before and tens of thousands of small sellers across India already seeing success, we are excited by how India loves Amazon’s commitment to offer largest selection, great convenience and exceptional value to its customers,” said global senior vice president and country head, Amazon India, Amit Agarwal.

Fashion And Tech Rule On Flipkart, Amazon

The economic slowdown doesn’t seem to have impacted consumer appetite for the sales, particularly in the fashion category. Flipkart saw huge demand in beauty products, women’s ethnic wear, kidswear, sports, fast-moving consumer goods, baby care, private labels, and furniture on the first day of the sale. The platform had thrice as many transactions during the early access period, as compared to last year. Fashion vertical grew nearly 5X in terms of sales, and beauty products saw a huge surge in demand.

Like every year, after fashion products, the major attraction was in the category of smartphones. For Amazon, sales from premium smartphone brands such as OnePlus, Samsung and Apple exceeded INR 750 Cr within 36 hours. Large appliances showed a growth of nearly 10X over an average business day. Customers enjoyed offers on Fire TV Stick and it was once again among the highest selling deals on Amazon with 50X increase in sales over an average business day.

But China And The US Still Lead The Way

While the Indian ecommerce market is definitely booming in the festive period, the revenue generated in India is still a fraction of what happens on big shopping days in China and the US.

In China, sales often coincide with long national holidays. Alibaba’s Singles’ Day is the most successful retail innovation in China. The Double 11 Shopping Festival, as it is called, is two and a half times bigger than Black Friday and Cyber Monday combined. In 2018, Alibaba the gross merchandise value (GMV) was over $30.8 Bn in sales in the 24-hour shopping event. In 2017 it was $25.3 Bn. Every year, during the 24-hour period, Alibaba offers huge discounts across its ecommerce storefronts.

China’s other shopping days such as Children’s Day, Women’s Day and Chinese New Year are popular as well. According to Kung Fu Data, Women’s Day 2017 had around $4.5 bn. Sales haul in China easily exceeds the spending by consumers in the US. However, India is still behind the US. Nearly 44% of Amazon shoppers shopped on Amazon Prime Day this year.

According to Statista, a German statistics company, the US online retail sales of physical goods will surpass 740 billion US dollars in 2023 and apparel and accessories retail ecommerce will be over $145.8 bn by 2023. Ecommerce revenue is expected to grow to $1,095.5 bn in 2023 in China and $62.3 bn in India.

Author

Shanthi S

Inc42 Staff
Journalist

Shanthi has 13 years of experience in journalism, both print and digital media. She specialises in writing long format feature stories. Trends, interviews and human-interest stories are her forte. You can write to her at [email protected]

Responses
https://inc42.com/features/how-industry-leaders-are-acting-as-role-models-to-strengthen-indias-culture-of-entrepreneurship/
Loading Next…

Upcoming Events