Electronic communication platforms saw only nominal growth in I-Day sales
E-commerce platforms including Amazon and Flipkart saw only nominal growth in sales volume during this Independence Day (I-day) sale compared to I-day sales volume. day of 2021.
According to logistics company Shiprocket, which handles shipping for digital brands, saw 7.2% growth in shipping terms between August 6-10, 2022 compared to 2021. Flipkart and Amazon held sales for Independence Day between August 6th and 10th. .
Decline in growth
At least three e-commerce vendors who Activity area spoke said there was a decline in the growth seen during the Independence Day sales period compared to last year. A clothing seller listed on multiple e-commerce platforms, including Amazon, Flipkart and Myntra, said Activity area that his brand’s sales volume growth during this Independence Day Sale was nearly 30% lower than what he saw during the 2021 Independence Day Sale.
Speaking about the potential reasons for the lukewarm response to Independence Day sales, Abhishek Maiti, director of trade research and market intelligence firm PGA (Praxis Global Alliance) Labs, said: “One of the reasons could be that shoppers or consumers who shifted to online only because of the Covid-19 pandemic have actually started to shift back offline. It should be noted that unlike e-commerce platforms, offline retailers such as Nexus Mall, Eternity Mall and Croma saw exceptional growth during the Independence Day sale.
The Nexus Malls portfolio is estimated to have seen a 35% growth in sales during this Independence Day sale and footfall also showed a good increase compared to 2019, according to Nexus Malls Marketing Director Nishank Joshi . The Nexus Mall portfolio comprises approximately 10 million square feet of retail space spread across 17 malls in 13 cities across India.
Consumer demand on the rise
A recent retail survey by the Retailers Association of India (RAI) also indicated growing consumer demand. The RAI survey noted that in July 2022, retail outlets across India recorded around 18% growth in sales from pre-pandemic levels (July 2019).
Additionally, PGA Labs’ Maiti said another reason for the slow growth in online sales volume could be e-commerce companies’ increasing focus on profitability. “A lot of e-commerce businesses have now started trying to build for profitability. This means they are trying to reduce the CAC (customer acquisition cost) and therefore reduce their marketing spend. This can basically be a very direct reason for the low growth in sales volume during this Independence Day sale. I think a combination of these two reasons is why we are seeing this trend,” Maiti said.
Kapil Makhija, CEO of Unicommerce, saw it as a sign of a maturing e-commerce ecosystem, where consumers don’t wait for the sales season and shop online all year round. “E-commerce has become an integral part of the retail industry in India, with steady annual growth. The e-commerce industry in India has evolved significantly over the past couple of years, consumers are not just shopping online for deep discounts, they are shopping for convenience and wider product options,” he said. he adds.
Cumulative order volumes in the first 15 days of August 2022, compared to 2021, grew by 30%, according to data compiled by Snapdeal-owned SaaS e-commerce platform Unicommerce. On top of that, Abhishek Chakraborty, Executive Director of DTDC Express Ltd., said shipment volumes this year were even higher than pre-covid levels and DTDC has seen a significant number of shipments to the Tier 2 and Tier 3 cities.
Flipkart and Amazon did not comment. Activity area requests.
forerunner of diwali
The Independence Day sale is usually a precursor to the festive Diwali and Dussehra mega sales on e-commerce platforms, which are expected to start around October. In 2021, e-commerce platforms recorded $2.7 billion in gross merchandise value (GMV) during the first four days of the 2021 festive sales (October 2-5), according to consultancy RedSeer.
Speaking on the expected trends of this year’s festive sale, Maiti said that the spike in growth of the upcoming festive sale may now be as pronounced as last year, but it certainly won’t be as low. than the performance of the Independence Day sale.
“It has been established for a few years that people actually put off shopping for a few months and wait for festive sales. If this trend of reducing consumer purchases continues over the next one or two months, then e-commerce companies will be in great competition in terms of discounts, marketing and promotion,” he added.
August 19, 2022