E-commerce sales jumped 35% over last year, better than previously expected | The Financial Express

E-commerce sales jumped 35% over last year, better than previously expected

Underscoring the magnitude of the festive sale, Flipkart announced it added more than four million first-time customers and saw one billion customer visits during its sale which ran from September 22-30.

E-commerce sales jumped 35% over last year, better than previously expected
Of that, smartphones accounted for roughly 45% of the sales during September 22-25, thanks to the expected rollout of 5G services in the country. Categories like fashion, too, drove sales higher.

E-commerce sales jumped 35% year-on-year (y-o-y) during the first week of the festive season sales led by growth in the personal care and electronics segment, which reported growth of over 60% from the same period last year, Unicommerce said on Sunday.

Analysts at Redseer had earlier predicted the gross merchandise value (GMV) of e-commerce companies to touch $5.9 billion. Of this, 60% had already been achieved between September 22-25, highlighting that the festive season was even “better than anticipated” on the back of robust demand. Overall, the GMV of the companies this festive season, which is usually a series of sales between September and October, was expected to jump 28% jump y-o-y to $11.8 billion.

Of that, smartphones accounted for roughly 45% of the sales during September 22-25, thanks to the expected rollout of 5G services in the country. Categories like fashion, too, drove sales higher.

“We were initially apprehensive about how this year’s festive sales will fare, but the numbers have been very encouraging. All our doubts are now put to rest. An increased shopper base coming in from non-metro cities has definitely provided a boost, even though their average ticket size is lower than the metro (cities) peers,” an executive at a large e-commerce company told FE.

Tier-2 and 3 cities drove a bulk of the sales and were forecast to broadly continue at the same pace. “Together, Tier-2 and Tier-3 constitute almost 60% of the market share showing immense growth potential,” Unicommerce said.

Meesho, a player dominant in the space, said it ended its sale with about 33.4 million orders, witnessing a 68% growth y-o-y. Meesho typically has an average order value (AOV) of around Rs 300.

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Underscoring the magnitude of the festive sale, Flipkart announced it added more than four million first-time customers and saw one billion customer visits during its sale which ran from September 22-30.

Analysts at Bernstein said the annual festive sales around this time of the year is crucial for e-commerce players; festival sale GMVs have been ranging between 18-20% of the overall GMV since 2018, they added. Last year, Flipkart was the leader during the season, capturing a share of 62%, while Amazon had a share of 27%. Further, Amazon — with about 43.6 million app downloads — lagged behind Flipkart which saw 50.5 million app downloads, they said. This year, however, Flipkart’s app downloads declined to about 35 million.

This festive sale was a bumper for direct-to-consumer companies as well. Lavanya Pachisia, chief operating officer, Zivame, a lingerie startup, said in an interview with FE that the company sold about 250 products every minute through its own platform, which was 5x more than its business-as-usual sales, with a “considerable” amount coming from Tier-2 and beyond cities as people begin to increasingly step out. She said the company’s ticket size ranges between 1,500 and4,000.

Apart from the aforementioned categories, the FMCG category saw a 41% y-o-y growth, followed by the health and pharmacy sector, which witnessed a growth of 37%, Unicommerce said.

New Delhi-based Unicommerce works with e-commerce companies like Myntra, Amazon, boAt, and others to provide warehouse and inventory management services. The company said it analysed 17.5 million orders across e-commerce channels that were processed for the findings.

With online shoppers projected to increase to 300 million, India’s e-commerce spending is expected to grow two fold to over $130 billion in GMV by 2025, Bernstein said.

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