After seeing a drop in sales post demonetisation, e-commerce players have returned with a festive season sale in the run-up to Christmas and New Year.
After seeing a drop in sales post demonetisation, e-commerce players have returned with a festive season sale in the run-up to Christmas and New Year. According to data released by Redseer Consulting firm, a market research firm, the e-commerce industry witnessed a 15-20% fall in transactions in November.
According to Sreedhar Prasad, partner for e-commerce at KPMG, the e-tailing industry which was expected to clock a gross merchandise value (GMV) of about $4 billion this year, pre demonetisation, may find it difficult to meet its sales targets.
“Last fiscal, for the October-December period the online commerce industry reported GMV of $4.2 billion about 35% of the over all GMV which stood at $12 billion,” observed Prasad.
However, e-commerce giant Flipkart, which is currently running its Big Shopping sale from 18-21 December, said that it will be able to cross its sales target for October-December period this year.
“Till November 8, we were way ahead of our sales target set for the festive season from October-December. But post demonetisation sales dropped by as much as 40% within 2-3 days. The situation became a tad better by the first week of this month. In the first week of December the drop in sale was 12-15%,” said Smrithi Ramachandran, director, category management, Flipkart.
As per Flipkart, it has seen a three-four times jump in sale of electronic goods including large appliances, mobile phones etc. The company has also witnessed a 2.5 times increase in sale of fashion and lifestyle products, since the roll-out of the sale.
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Similarly, Snapdeal started its Unbox sale from 17-19 December. The e-tailer is offering 10% instant discount on prepaid orders, across all debit and credit cards.
“Immediately post the announcement, we had recorded a marginal dip in overall order volumes, but demand is now trending back to normal. More importantly, we witnessed a significant move towards digital payments, with cash-on-deliver (CoD) now close to 30% of total sales volume, from a 50:50 ratio before demonetisation,” said a Snapdeal spokesperson in an e-mail response.
Even as sales have picked up, analysts say there has been a drop in average order value by 30%. According to industry estimates, prior to demonetisation, the average order value stood at R1,800.