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Is e-commerce ad ambush really working?

Is e-commerce ad ambush really working?

Author | Ankur Singh | Friday, Oct 17,2014 8:03 AM

Is e-commerce ad ambush really working?

It all began with the Indian Black Friday sale hoopla created by Flipkart in the first week of this month. The mega sale of the festive season was driven by e-commerce players attempting to ambush each other on advertising mediums, especially by attempting personal gags at each other on print and digital mediums. The most apparent ambush was witnessed in The Times of India ads that began to flow since October 6. And, since then, each week, the mainstream paper has jacket ads with e-commerce ads sprawled all over—with one brand attempting to downplay the other.

The trigger

Flipkart had been on an advertising and promotional high since last week of September announcing its ‘Big Billion Day’. It was a move to race ahead of all other e-commerce websites, and establish who the “Big Daddy” of the Indian e-commerce space is.
However, the plan wasn’t as effective as Flipkart wanted it to be. Snapdeal, had a counter ad that was up, close and personal. The Full-page ad in TOI said “For others it’s a big day, for us, today is no different. Check before you buy”.
Come evening, and Amazon pulled a personal trick on Flipkart too. This one gave Snapdeal’s ambush on Flipkart a run for its money. When buyers went to, the browser took them straight to Ouch!

The day saw e-commerce players declaring open war against Flipkart.

What followed

Although e-commerce accounts for less than 1 per cent of the total retail market in India, it is by far the fastest growing retail channel. It is estimated to grow to as much as $22 billion (excluding travel) in five years from $3.1 billion currently, according to a November 2013 report by CLSA.

The war triggered by Flipkart is set to continue with a host of companies looking to woo consumers with big discounts. Both Snapdeal and Amazon have expanded their offerings in coming weeks including a host of products that are top on Indian consumers' list, while Flipkart itself is launched at a bigger version of its day -long sale with a week-long offering starting the first weekend of this month.

Amazon, which also ran a three-day discount campaign, Mission to Mars, between October 4-6, launched its next big sale, Diwali Dhamaka, between October 10-16. The brand again advertised heavily on all mediums. Flipkart also did a week-long programme during the same period. However, this week did not witness any cheeky advertising or personal gags against the rival brands.  Snapdeal is expected to continue its ongoing scheme where discounts would be on offer on top of the line products on each day running up to Diwali.

The impact

Despite the negative buzz, Flipkart’s Billion Day sale’s significance in starting the e-commerce fire in the country cannot be negated. The so-called ‘never-before’ marketing campaign drove lakhs of first-time users to log into e-commerce sites.

This sector has been on a fast-forward mode since the past two weeks. The Flipkart ‘fiasco’ also gave a chance to all market players to step back and evaluate their strategy for the future.

Flipkart claims to have clocked $100 million gross merchandise value in 10 hours on October 6.

Snapdeal said it made a sale of Rs 1 crore a minute - which makes it Rs 600 crore in 10 hours. Flipkart led the marketing campaign pouring in crores followed by Snapdeal. But Amazon with much less fanfare, capitalised well on the occasion.

However, the online retail champions came under fire from offline rival Future Group as well as vendors using online marketplaces for selling products at below cost price. The Future Group has accused Flipkart of adopting anti-competitive strategy by selling products below cost price, backed by foreign funding.

E-commerce companies in India are locked in a fierce fight to get the lion's share of India's growing e-tail market. The kind of cash they has raised from investors clearly shows in the ad spends throughout this season. It, however, remains to be seen how these ad spends on ambushing rival players progresses during this season, and how effective it proves to be on the overall sales.

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