India recorded it’s highest sales in e-commerce in 2015 and to a large extent, the sales came from big sales marketed heavily by the top e-commerce players. Powered by big investments poured into all the top e-commerce companies including a $2 billion cheque from Amazon to its India division, managed to lure several Indians who made their first order in 2015.
Fashion and Lifestyle
While most of India’s category specific e-tailers are being pushed out of business by big discounts and even bigger sales, one category that continues to thrive against all-category e-tailers is Fashion & Lifestyle. Online Fashion retailer, Jabong recorded their highest sales ever in 2015. Although Jabong also does sell home products, their bestsellers remained shoes and apparel throughout the year. The retailer also recently completed a new year campaign with extremely deep discounts called the Happy New You Sale. Fashion is expected to continue its upward trend and escalate further with Indians getting comfortable with e-commerce.
Big Sales to get Bigger?
Having gained significant momentum in 2015, the e-commerce space is expected to explode in 2016 at its potential. TV ads, coupons and Big sales have successfully encouraged India’s middle class to hit the checkout button.
Big Sales including Flipkart’s Big Billion Days, Amazon’s Great Indian Festive Sale and others saw a significant portion of all purchases Indians made online in 2015. Having tasted success, India’s top retailers are likely to increase their budgets in marketing and customer acquisition costs for 2016 even further.
Unexplored Part Of The E-Commerce Pie
While India continues to have the world’s fastest growing e-commerce industry, the fight to the top was extremely fierce in 2015. With retailers focusing on existing potential, there is no reason for things to slow down in 2016. With even more Indians expected to place their first orders online this year, e-tailers are doing everything they can to get those orders. With Internet and smartphone penetration rates in India currently at the fastest worldwide, and increasing middle class income, the Indian e-commerce industry is slated to be one of the biggest in the world.
Changing Customer Behavior
The long term effects of big sales with deep discounts and bigger marketing budgets have been the subject of a lot of debates in the recent times. Especially with profitability at the core of the discussion, however, there have been concerns about whether e-commerce companies are spending too much on ‘customer acquisition’ a term that has been very controversial in recent times. While e-tailers continue their focus on big shopping sales to bring in first time users, concerns have been raised of having encouraged existing customers to wait for a sale to place their orders. Supporters of the argument suggest that this might also explain the lackluster post sale season revenues. On the contrary, a surprisingly warm winter has also been attributed to the decline in sales.
The Indian Online Customer
In any case, 2016 is set to be the year of the Indian online customer. With so many multi-billion dollar valued e-commerce companies in the race to earn Indian loyalty, online shoppers are in for a treat this year. Now that the country is expected to bring the next trillion dollars in GMV in e-commerce worldwide in the next few decades, it shouldn’t come as a surprise if more International players start to enter the country.