Diwali season lights up India’s online commerce

Online sales have been booming for the Diwali season as Indians have flocked to the internet to buy gifts, mobile phones and clothes, with forecasts that e-commerce sales could triple this festive period over last year.

Diwali, often referred to as the festival of lights, is India’s main shopping season. Indians buy products ranging from clothes to cars in the weeks leading up to the actual day of Diwali, which this year falls on Wednesday.

“Our sales have grown 700 per cent over the previous weeks [before the season started],” said Rahul Taneja, the vice president of category management at Snapdeal, one of India’s biggest online marketplaces, headquartered in New Delhi.

“Our estimate is that e-commerce in India this Diwali should be 2.5 to three times as much as last year,” Nitin Bawankule, the director of e-commerce at Google India, was quoted as saying by Business Standard, an Indian newspaper.

Amazon, Flipkart and Snapdeal dominate India’s online retail market and are expected to account for an US$8 billion share of a predicted $10bn market this year, he said. Last year, there were $4.5 million worth of online retail transactions in total in India, Mr Bawankule said.

For Snapdeal, sales of some categories of items have surged by 17 to 20 times compared to normal business days, such as furniture, home furnishings and women’s ethnic wear. It has already shipped about 11 million items so far for the festive season, according to the company’s figures.

“The festive season is not over for us yet, as we have more sale days until Diwali,” said Mr Taneja.

The rise of high-speed internet and smartphone use in the country has helped its e-commerce industry to grow.

Electronics has continued to be the largest category for Snapdeal by sales revenue this Diwali, the company said.

“On our Monday electronics sale day, we sold six mobile phones per second,” said Mr Taneja, adding that there had been a surge in demand for 4G phones.

Preparing for the huge number of orders during the festive season is a major logistical undertaking.

Mr Taneja said that the company was investing $300m this year in its logistics and supply chain operations.

Snapdeal has added 1.3 million square feet of warehousing space over the past year. It also teamed up with Gojavas, an Indian logistics company, earlier this year to offer a wider range of delivery and payment options to its customers, including a four-hour delivery service and payment by card on delivery.

Retail stores in India normally launch offers to coincide with Diwali and online shopping websites have also followed this tradition, with flash sales and discounts to lure consumers.

Infibeam, an Indian online retailer that focuses on sales of electronics, says it has launched various promotions for Diwali. These include competitions with prizes on offer such as a Toyota car and the opportunity to meet the Bollywood star Salman Khan.

“New categories and brands have adopted the online platform to tap the customer base online,” said Shekhar Singh, the head of corporate communications at Infibeam, adding that the company was experiencing “huge demand” this Diwali.


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Rebecca Bundhun

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