Online cracker

Updated: Oct 31 2005, 05:30am hrs
Its time for virtual celebrations as Diwali takes the cyberworld by storm. The boom is more than evident at online malls decked up for festivities. Signs are promising. Sales are learnt to be on track to jump 100% this time around. While Sify expects 30% of its annual sales this season, Fabmall is getting ready for three to four times more orders compared to last Diwali, up 10 times over an average day. Ebay, Indiatimes, Rediff and ExpressIndia are equally bullish.

And a bumper Diwali could go a long way in changing the online shopping dynamics of the country. Festive seasons account for half the transactions made online and Diwali alone contributes over 10% of the e-purchases made in a full year.

Analysts are already predicting B2C e-commerce will cross Rs 1,000 crore this year. Diwali and other festivals like Bhai Dooj and Dhanteras constitute the bulk of our transactions. Sales start picking up immediately after the Shradhs in September, confirms Sify CEO, R Ramaraj. We are preparing for an online boom like during Rakshabandhan. We see a more than 200% rise during festive season, echoes ExpressIndia online head, Mohit Bhakuni.

Festive season is probably the only time of the year when online shopping of consumer durables and apparel come out of the shadows of travel that normally corners a lions share of consumer e-commerce. Though many people coincide their travel plans with Diwali, most of the bookings are done a couple of months in advance, thus leaving the market open for other products, explains IDC analyst Parijat.

Though numbers are yet to get anywhere close to the footfalls in brick-and-mortar mall, early signs of e-commerce boom started last year. Over 2.3 lakh Indians made online purchases during Diwali with over 3.45 lakh transactions getting registered, resulting in sales of Rs 53 crore during the Diwali period last year. Though online shopping began to spur last year, shoppers were found to be price conscious with average transaction value pegged at Rs 1,535, says Internet and Mobile Association of India (IOA).

Going by the changing profile of products being sold online, average transaction size could be on its way up. Big-tickets items like air conditioners, refrigerators, along with apparels and gifts are becoming favourites among online festive season shoppers. Profile of buyers is also changing, with small towners logging in. Close to two-third of our visitors come from non-metros compared to 60 % from metros till three years back, confirms Fabmall COO K Vaitheeswaran.

Online shopping is expected to cross Rs 1,180 crore in 2005-06 and is likely to grow to Rs 2,300 crore by 2006-2007, according to IOA. The growth is primarily because the online shoppers have matured. In the past, many casual internet users were found to have made their first ever-online purchase during Diwali, agrees eBay India country manager, Gautam Thakkar.

Festival season also marks entry of more than 15% first time shoppers. These are online users who have never shopped before and they do so for multiple reasons. Great price and equivalent brand promise whether they shop online or offline or just because that product and service is not available in their city, confirms IOA president Preeti Desai.

Obviously, it is the busiest time for shopping portals with retailers improving their technology and increasing offers. Though promotions start pouring in a month before Diwali, preparations at the backend start about three to four months in advance. We have people working round the clock for in the last 3-4 days before Diwali who follow up with all the vendors to service the orders so that the gifts are reached on time, says Sify senior VP (interactive services), Surya Mantha.

What started as a trickle with NRIs sending or receiving gifts online is now promising to turn into a flood especially on Diwali, Rakshabandhan and Valentines day.