Sales galore as Indian web giants woo reluctant festive shoppers

E-commerce giants Amazon and Walmart-backed Flipkart kicked off a crucial battle for shoppers on Sunday ahead of India’s massive festive season as retailers search for a much-needed boost to sales in a slowing economy. (AFP)
Updated 29 September 2019

Sales galore as Indian web giants woo reluctant festive shoppers

  • October and November are critical for retailers in India, with some raking in almost half of their annual sales during the period
  • Less than five percent of India’s $600 billion retail market is online, but the sector is expected to expand

NEW DELHI: E-commerce giants Amazon and Walmart-backed Flipkart kicked off a crucial battle for shoppers on Sunday ahead of India’s massive festive season as retailers search for a much-needed boost to sales amid a slowing economy.
October and November — when much of India’s 1.3 billion population celebrates several major Hindu festivals and consumers traditionally go on spending sprees — are critical for retailers, with some raking in almost half of their annual sales during the period.
But sales this year have been hit by falling consumer demand as a liquidity crunch crimps personal loans and unemployment soars to its highest level since the 1970s.
“Things are difficult,” Rakesh Kumar Yadav of the Federation of Sadar Bazar Traders Association, which represents some 40,000 wholesale traders in the capital New Delhi, told AFP.
Even aggressive pitches by Amazon and Flipkart, which have heavily invested in India’s budding e-commerce market, did not stop online consumer spending from slipping by around 20 percent in the six months to June compared to last year, the Economic Times reported citing market research firm Kantar.
“The festival season is around the corner... and a lot of these corporates are coming up with various schemes to prop up demand and woo the consumers,” India Ratings principal economist Sunil Sinha told AFP.
“But my own sense is that despite all the efforts, overall consumer sentiment is so down-and-out that we won’t see similar kinds of spending that we have seen in the past.”
With their deep pockets, Amazon and Flipkart are taking on India’s local family-run stores, known as “kirana” shops, that have dominated streets for decades.
Less than five percent of India’s $600 billion retail market is online, but the sector is expected to expand to 8-9 percent of the market by 2022 thanks to smartphone adoption and a rising middle class, according to RBC Capital Markets.
Amazon — which recently opened a massive campus for 15,000 employees in the southern city of Hyderabad — has taken out full-page newspaper ads to promote its “Big Indian Festival” sales and is offering discounts of up to 90 percent.
Flipkart has Indian mega-star cricket Virat Kohli as the face of their “Big Billion Days” sales campaign and has slashed prices on fashion items and home appliances.
The two platforms — which have almost 75 percent market share of the e-commerce market — hope to attract cash-strapped shoppers with financing options, and have hired hundreds of thousands of temporary staff to cope with expected increased demand.
Their six-day festive sales are estimated to reach $3.8 billion, up from $2.9 billion last year, despite the wider economic slowdown, Forrester Research senior forecast analyst Satish Meena said.
Bricks-and-mortar retailers are also ramping up their visibility to keep pace with the online behemoths.
“These are difficult times and consumer sentiment has been tilted toward the negative for some time now,” J. Suresh, the managing director of Arvind Lifestyle Brands, told the Economic Times about why the 1,300-store owner was increasing ad spending by up to 20 percent this year.
Meanwhile, economists said a raft of recent government measures to revive the flagging economy, including a corporate tax cut, would improve sentiment in coming years.
“It’s a good beginning... The likelihood is that we’ve almost reached the bottom and if the government continues to do its bit and corporates remain upbeat because of these announcements, things will start looking up,” Sinha said.


Getting more women into leadership positions top priority: CEO

This June 23, 2018 photo, shows a general view of Riyadh, Saudi Arabia. (AP)
Updated 18 January 2020

Getting more women into leadership positions top priority: CEO

  • Saudi Arabia is focusing on the Business 20 (B20), making this one of the key engagement groups. Women in Business will be Saudi Arabia’s signature topic

RIYADH: The boss of one of Saudi Arabia’s biggest banks says that getting more women into leadership positions is a top priority.
Samba CEO Rania Nashar chairs the action council for Women in Business created by the Business Twenty (B20), which is the official G20 dialogue with the business community. It represents the global business community across all G20 member states and all economic sectors.
She said the council was set up to boost women’s particpation not only in business but also in global leadership positions.
During the launch of the B20 in Saudi Arabia this week, Nashar highlighted the under-representation of women in the economy.
“There is a gap of 27 percent between male and female workers; 75 percent of males are part of the labor force while only 48 percent of females are working,” she said.
She said it was important not to just talk about women as workers but as business owners.

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Saudi Arabia will host the 15th G20 Summit in Riyadh on Nov. 21-22, 2020.

“That’s why entrepreneurship is very fundamental to our task force,” she said.  “The majority of the finance development programs have incentives for giving loans to females; however, despite the fact that many large borrowers are females, the amount of loans granted to them is far below what is granted to males,” she added.
Nashar said that two-thirds of female business founders feel that they were not taken seriously by investors when they pitch for investments. They also feel that they are treated differently from their male counterparts.
Saudi Arabia will host the 15th G20 Summit in Riyadh on Nov. 21-22, 2020. The Kingdom is focusing on the Business 20 (B20), making this one of the key engagement groups. Women in Business will be Saudi Arabia’s signature topic.