Amazon, Flipkart may clock $3 billion in GMV during 5-day festive sale

The two big e-commerce players — Amazon and Flipkart — together are expected to clock gross merchandise value (GMV) ranging between $2.5-3 billion during the five-day festive season sale this year, RedSeer Consulting has estimated in its latest report. This is a jump of almost 67-100% in GMV against a similar period last year, when they together had clocked a GMV of $1.5 billion.

Though the dates of the sale have not been announced, it is expected to be sometime in October before the Puja festival.

Both Amazon and Flipkart hold five-day festive season sale every year. While Amazon’s sale is called the Great India Festival, Flipkart calls it Big Billion Days. Last year, the two e-tailers held the sale almost around the same time between September 20-24.

Total number of shoppers also are expected to increase to 20 million this year, against 14 million last year. As per RedSeer, this year e-commerce companies can expect new consumers from smaller cities especially Tier II. “Festive season sale is an important tool used by e-commerce companies to add new customers. Both Flipkart and Amazon have already rolled out several offers and initiatives to ensure that shoppers from smaller cities flock to the platforms,” Ujjwal Chaudhry, engagement manager, RedSeer Consulting, said.

Flipkart now offers EMI on debit card. The e-tailer had launched a private label for furniture called ‘Perfect homes’, early this year. The newly launched label is expected to contribute 30-40% of the category’s revenue by end of 2018, said RedSeer in its report. Additionally, in August, it launched 2GUD — a new platform to sell refurbished good.

The Walmart-backed e-tailer on Friday said that it aims to capture over 30% of the phone sales during the festive season sale period. According to Flipkart about 25% of the total number of phones sold in the country are sold through its website.

“Our platform will have a number of new launches in alliance with our handset partners (during the festive sale). There will be devices across price points…we expect strong volumes coming especially in the `10,000-15,000 category as well as the entry-level smartphones (`4,000-7,000),” Ayappan Rajagopal, flipkart, senior director, smartphones, Flipkart, said.

Its rival Amazon on the other hand has launched its website and app in Hindi in its effort to grab a large share of the Tier I and II cities. The e-commerce firm has further ramped up its logistics and supply chain network for faster delivery in smaller cities. It has currently 67 fulfilment centres across 13 states.

In terms of categories, Redseer expects the share of fashion to increase to 15% from last year’s 13%, while mobile and tablets as a category is expected to a see a decline of 1 percentage point to 52% this year, from last year’s 53%. Electronics’ share in the GMV is also expected to reduce to 23% from last year’s 26%.

As the two companies readies to battle it out this festive season, Redseer points out that the total number of shipments this year would be less when compared to the growth in GMV as consumers are expected to buy more of high ticket value items. Total number of orders expected to get shipped this year is 48 million.