flipkart

There is this thing with e-commerce retailers. Their money disappears almost as soon as investors can hand it over.  Now that may be an exaggeration, but e-commerce companies are some of the fastest money burners around. We got a reminder of ‘Why’ as Amazon and Flipkart announced that they were all set to offer consumers a massive discount sales this month.

The announcement puts the sales at both Amazon and Flipkart head to head with each other and now, each will be attempting to pull more users to itself. Sellers on both the platform are riveted by the opportunity as it will allow them to pick up and compensate for some of the business they lost in wake of demonetization. Flipkart’s sale will range from May 14 to May 18 and will be called as the ‘Big 10’, to mark the e-commerce retailer’s 10th anniversary. The company will offer discounts of up to a massive 80 percent on the merchandise on its platform.

Flipkart expects a 3 to 4 fold rise in revenue during this period. It’s fashion e-tailer Myntra will also be running a mega-sale of its own at around the same time. Amazon on the other hand, will be offering these discounts under the ‘Great India Sale’ moniker and the sale will span between May 11 to May 14. The company was all gushy about offering stuff at “never seen before prices”.

Both the companies have asked sellers to charge less money, significantly less money, and offer heavy discounts. The will be compensating for it by lowering their own margins and providing additional support via cashbacks from payment wallets.

While the focus of Flipkart’s discounting schemes are expected to be felt across consumer electronics and smartphones (no surprises there), Amazon’s focus is more likely to remain uniform and spread across different categories. Interestingly, this is also the first time that Flipkart is organizing a sale of this scale outside of “Big billion Days”.

Well, the customer certainly emerges the winner, but the strategy being deployed by e-commerce retailers is one that begs a lot of questions. Regardless, no one can let up the pressure by not offering discounts for fear of losing traffic and business to the competitor. This is an important time in Indian e-commerce landscape, where the playing field has arguably been reduced to just two major players. And both of them are now going to try to knock the other off its perch.

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