India: Flipkart’s sale runs into glitches, helping Snapdeal and Amazon

Photo: Mint

When Flipkart announced that its second big annual sale would be available only on its app, founders Sachin Bansal and Binny Bansal were betting that everything was in place to make this a glitch-free experience unlike last year.

But that was not to be. Sellers and customers complained of problems, including products not showing up or logistics partners servicing only limited shipments. Such issues have helped rivals Snapdeal and Amazon get more orders in their own discount sales events as all three battle for higher marketshare during the month-long Indian festive season that began Monday. The first nine days, called ‘Navratra’, are considered auspicious for making big purchases.

Flipkart, which has raised over $3 billion from investors such as TigerGlobal, Naspers and DST Global, is a marketplace, like Snapdeal and Jabong, because Indian laws do not allow them to sell directly to consumers, unlike the business model that Amazon has in the United States and Europe. Amazon’s India also follows the marketplace model, and launched its biggest sale of the year on the same dates as Flipkart.

Some sellers complained that their products were not showing up on day 2 of Flipkart’s ‘Big Billion Days’ sales event, which began on the 13th of October and ends Friday. Many of them had stocked up in the hope of increased demand during this sale, because of significant discounts on everything from mobile phones to washing machines. Lack of visibility of their products resulted in sales dropping to zero.

Other sellers complained that Flipkart’s logistics partners were picking up only limited shipments. Because of a 40 per cent spike in sales during the period, the company’s logistics capacity was stretched beyond its limit. “Being a marketplace, everything that is ordered by the consumer has to be supplied by the seller. And we have limited capacity in terms of how many people we have and how many collections we can do in a day,” said Manish Maheshwari, vice president and head of sellers’ ecosystem at Flipkart, in a Economic Times report.

Meanwhile customers complained that the prices of mobile phones seemed to be listed higher so the discount given on them was not really resulting in meaningful savings, an issue that had arisen last year as well. Certain products such as room heaters were available, but not delivering to all cities including south Delhi, normally serviced well by Flipkart.

Kunal Bahl, co-founder of Softbank-backed Snapdeal, took a potshot at Flipkart’s issues on social media. His company launched its own big sales event a day before Flipkart’s, with a TV campaign starring Bollywood star Aamir Khan.

Still, Flipkart did better than last year, when its website had crashed several times and thousands of customers had complained on social media about not being able to buy products even after placing them in the cart and checking out in the designated time.

And while Snapdeal generally got positive reviews of its performance, there were complaints by customers of products getting out stock after being placed in the shopping cart. The Gurgaon-based company reported five million orders during the first three days of its pre-Diwali sale, and more than a million downloads of its app on the first day.

Amit Agarwal, vice-president and country manager, Amazon India, said the company had its highest ever sales during the ‘Great Indian Festive Sale’ that ends today. Apart from swift delivery, the company also offered a kilo of gold everyday in a lucky draw for customers who shopped during this period. Social media feeds show that customers generally had positive reviews about swift delivery, and did not report any glitches. India currently contributes the most new customers to Amazon outside the United States, and the company has invested $2 billion since it started in 2013.

On the last day of its sale event, Flipkart’s co-founders decided to find out more about customers’ experience during the sale by personally delivering to some of them, something that the Bansals used to do in Bangalore when they started the company in 2007.

 

Also read:

Mohandas Pai, Ratan Tata & Kunal Bahl are India’s top angel investors in 2015

Reliance Industries plans e-commerce foray, smarphones launch this year

Metro Cash and Carry chooses India for its worldwide ecommerce sales debut

 

 

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.