The cake is bigger and still losing money
文 | 令晨@出海
Picture | Vision China
Starting from the Great Indian Festival and Big Billion Days,To the Diwali festival that is being celebrated these days,The e-commerce festival season in India is starting .
The Great Indian Festival is Amazon’s largest holiday sales event in India, and Big Billion Days is a large-scale shopping festival launched by local e-commerce Flipkart in recent years. In addition to Amazon and Flipkart’s largest promotions in India, these two festivals also represent the beginning of the Indian e-commerce festival season, followed by a series of online marketing campaigns due to Diwali (“Indian Spring Festival”). .
According to recent data, the traffic and income generated during the Indian holiday season accounted for about a quarter of the annual revenue of the two companies.
In early September, Flipkart received $16.16 billion ($228 million) in rupee funding from parent company Wal-Mart before the start of the annual festival.
Flipkart previously told local media that in order to welcome Big Billion Days, in the past few months, the company has doubled the number of identifiers that provide sellers with delivery functions, and added about 30,000 mom and pop stores. Customer support, enhanced delivery and delivery of the last mile.
This year’s Great Indian Festival and Big Billion Days began on September 29 and ended on October 4, lasting six days. After the end of , both Amazon and Flipkart said that sales this year set a record due to the increase in orders from the town and the increase in sellers on the platform.
According to the Indian Economic Times, the two companies had a GMV of $3 billion in the first phase of the holiday season, a 30% increase from last year and below analysts’ forecast of $3.7-3.8 billion. According to The Ken, Flipkart’s GMV is 840 billion rupees ($1.18 billion). According to sources, the company’s internal target is 92 billion rupees ($1.29 billion). Last year, Amazon and Flipkart had a GMV of about $2.3-2.9 billion on holiday season promotions.
Promotions can lead to sales growth, but they also incur related costs.
According to the financial report released by Flipkart on October 28, as of 2019On March 31, Flipkart’s annual revenues for the e-commerce business increased by 51% compared to the previous fiscal year, but Flipkart’s annual loss increased by 40%. Among them, the cost of advertising and promotion increased by 56% compared with the previous fiscal year.
More than Flipkart, Amazon India is also losing money.
Amazon India’s revenue for the previous fiscal year released on the 29th showed that as of March 31, 2019, Amazon India’s revenue in the fiscal year 2018-2019 was 112.32 billion rupees ($158,000). Last year it fell by 8%.
The revenue for the entire event season is currently unknown, but in recent months, local governments have begun to review promotions and discounts such as the Big Billion Days and the Great Indian Festival. In the long run, the review may affect the income of both companies.
Moreover, the Indian trade organization also protested against the promotion of e-commerce.
The Indian Trade Federation (CAIT) issued a statement in late October accusing Flipkart and Amazon of the festival’s promotion during the holiday season, which triggered a decline in the traditional retail industry, criticizing the low price of goods on the two home appliance platforms, resulting in Other suppliers were forced to withdraw from the market without a competitive advantage.