Ecommerce Sales: E-tailers Book Record $7 Billion in Sales in Festive Month | Business news from India

BENGALURU: E-commerce companies are expected to see a nearly 50% increase in gross sales to $4 billion on this Diwali, a two-year high, during five-day sales events from Flipkart, Amazon India and others, according to the latest Estimates by market research company Redseer.
As Covid-19 accelerates digital adoption and traditional offline shoppers move online, consumers are expected to surge by over 70% for the festive season of 45-50 million digital shoppers. Redseer estimates that more than 50% of these will come from Tier II cities and beyond. The entire festive month in 2020 is expected to bring in gross sales of $7 billion up from nearly $4 billion last year, an increase of 75%.
The date of the much-publicized sale has yet to be announced, but e-tailers have begun working with brands, sellers and logistics providers ahead of the event, which is expected to take place next month. Industry executives are also working with sellers and brands to solve supply chain and investment issues and manage the surge in demand.

“Technically, what demonetization did to the payments space, Covid-19 almost did to the e-commerce space. We anticipate a higher number of shipments than we are currently seeing. At peak times there should be 7.5 to 8 million shipments a day. We have already planned for the season and now the execution will happen,” said TA Krishnan, co-founder and CEO of E Com Express, an external logistics company for online platforms. According to him, the industry currently ships around 5-5.5 million items every day.
Last year, the average shipments during the festival season were under 5 million.
According to industry sources, groceries, FMCG and general merchandise will lead to higher volumes due to Covid-induced demand. Typically, smartphones, electronics, small and large gadgets, and fashion dominate Diwali sales.
“The estimates are very realistic. There is a significantly higher adoption of digital in cities outside of the metropolitan areas. In terms of consumer behavior in the pre-Covid-19 era, we had seen some increase in online penetration, but this is the first time that there has been a sustained and significant move towards digital – with e-commerce penetration, which has increased to 5% compared to 3% last year,” said Ujjwal Chaudhry, Associate Partner of Redseer.

This year’s sales are also likely to come as there are signs of a gradual economic recovery compared to last year, when overall spending was subdued due to the broader economic slowdown, Chaudhry added.
“I’m diversifying into new categories like handicrafts, Diwali lights as there are supply issues in segments like electronic accessories,” said a Delhi-based online seller. Emails sent to Flipkart and Amazon India did not trigger any response.
Consider E-tailers post record sales of $7 billion during the festive months