The noise has died down. The sale is over. But how successful was Flipkart’s much-hyped The Big Billion Day really? We dissect the e-commerce giant’s October 6 sale event and subject it to a few dispassionate lenses to gain a perspective.
The Social Backlash
Firstly, let’s consider the actual customer sentiment. Social platforms like Twitter and Facebook were abuzz with talk of #BigBillionDay throughout the day. So far, so good for Flipkart, but the sentiment was not all positive. As the day progressed and as customers increasingly came across ‘Out of Stock’ products, suspicious pricing and technical glitches, the negative outburst, ever a risk, snapped its leash.
According to a research done by Simplify360, negative sentiment around Flipkart’s sale reached 12. 53 per cent from 4.76 per cent just a week ago, decreasing the positive sentiment from 24.48 per cent to 16.46 per cent.
Social media's 'Big Billion' lesson for Flipkart
And it was just not the sentiment that became a problem. Despite the tremendous hype, close competitors Snapdeal and Amazon were not that far behind in social mentions, proving that it was not just a one-horse race.
Flipkart founders Sachin and Binny Bansal sent out an email to all their patrons, apologising for the various issues they faced during the sale, explaining where and how the team goofed up and taking it on the chin.
Swati Nathani, Business Head of digital and social media agency, Team Pumpkin feels this incident shows that Indian e-commerce companies still have a lot to learn. “You cannot take your customers for granted. Flipkart did that and was subjected to massive backlash across social media. Another well learnt lesson was not to spill the beans too soon. Flipkart revealed the date in advance and the competition took the best advantage out of it,” she said.
Is this something Flipkart can bounce back from? There is no reason to believe that they cannot, but they would do well to learn from their mistakes here. But is the consumer also being too hard on them? “When customers queue up outside shops or malls during the sale season, they do not always end up getting everything they wish. It is a matter of luck at times and this is also pretty much the same case online. Agreed that there were few glitches, but any brand doing it at such a large scale is bound to make some unavoidable mistakes. Here I think the consumers need to understand and be patient,” argues Sameer Parwani, Founder and CEO of CouponDunia.
Did It Steal Business From Rivals?
Another factor that we can consider while deciding the success of Flipkart’s sale, is how much it affected its rivals—Snapdeal and Amazon. Both Amazon and Snapdeal had their festive offers happening on the same day, making for an interesting comparison. It was the last day of Amazon’s ‘Mission to Mars’ while Snapdeal was in the middle of its ongoing ‘Diwali Bumper Sale’.
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An Amazon spokesperson said that on October 6, sales doubled over the previous day, while Snapdeal also says it saw 100 per cent increase in sales since launching the campaign, though not necessarily on October 6. “In terms of sales value, both Flipkart and Snapdeal have reported similar figures, both stating clocking of highest numbers ever,” agrees Nathani.
Is $100 Million Good Enough?
In a statement, Flipkart founders said that they had achieved sales worth $100 million in gross merchandise value (GMV) within 10 hours of The Big Billion Day Sale with nearly 1 billion hits. An example to put things in perspective that is being floated around is, Alibaba’s ‘Singles Day’ on November 11, 2013, which saw it process more than $5.75 billion in sales in China. But this does not necessarily mean Flipkart did not do well.
For one, the e-commerce market in China is much more mature than India. “Generally, value per purchase is much lesser in India, whether online or brick-and-mortar, than the global average. So, we will always see a vast difference,” said Paresh Parekh, Tax Partner (Retail & Consumer Products) Ernst & Young.
The fact to remember here is that Flipkart did not necessarily hold this event to make profits. In fact, profits seem to be furthest from the minds of any of the e-retailers in India currently. “This (e-commerce) is still a volume game. Whatever Flipkart did, including sharing of the discount burden with the seller or brand, has been a conscious business decision made to capture eyeballs,” said Parekh.
If showing consumers the benefit of e-commerce was the only motive, then Flipkart has definitely succeeded despite the flak, but also as long as it is able overcome the negative opinion that many seem to have formed about it. There is yet another way of looking at it, namely, the effect that it had on traditional retail players.
This festive season has been ruled by the e-retailers and it is increasingly becoming apparent that traditional retail players will have to do something drastic to continue to stay relevant. “Off-line retail players have started to feel the pinch. A fashion retailer had told me that it would be foolish to open a store after 2015 and it looks like his prediction is turning out to be true,” said Parekh. Weighty words but maybe, whatever Flipkart and the others have achieved this festive season; this could be its best testimonial.