Amazon and Flipkart may have to turn some of their lights out this Diwali.
Over the years, India’s online festive sales have only become bigger and more frequent. Even before Amazon’s Great Indian Festival sale and rival Flipkart’s Big Billion Days sale, between Sept. 29 and Oct. 04, the e-commerce behemoths were already engaged in multiple price wars. While Amazon has hosted 13 sales events so far this year, Flipkart is not far behind at 11. Both had two-day mega sales in July.
“There are many returns of these products which further add to the cost of doing business. Many customers just order because of deep discounting and not because they need something. Then they decide to return it,” explained Yugal Joshi, vice-president at Texas-based consultancy Everest Group. “Moreover, customers’ price point get fixed and post deep discounting days, too, they expect similar pricing which makes an untenable business for the seller.”