End of season or middle of season sale?

Summer is anything but over, but most brick-and-mortar retailers have announced end-of-season sales almost a month ahead of schedule, perhaps to fight off the slowdown blues and loss of share to e-commerce portals. In order to drive consumer excitement and footfalls, some retailers have gone on sale as early as mid June.

Experts said end-of-season sales had been advancing for the last couple of years, generally scheduled between July and August, but it had never been this early. A spokesperson for apparel brand Lee agreed, pointing out multiple reasons for it. Apart from driving sales of the discounted stock, people also end up purchasing fresh stock, which is an important reason for the sale. "Secondly, people today are aware that apparel is available during sales at deep discounts. So the earlier you go, you feed into their anticipation," said the spokesperson. Delaying the sale would mean customer budgets could be exhausted or divided among other brands already on sale, the spokesperson added.

Brands and malls are also going the extra mile to woo customers to visit them. For instance, brands like Vero Moda, Jack & Jones and Only are offering merchandise on installments where shoppers can pay for the goods over the course of a few months. Offline retailers are also battling the side effects of their online counterparts selling deeply discounted goods and announcing sales many times in a year. To counter this, brands are holding mid-season or specific holiday sales to generate footfalls. For instance, Only offered a 'flat 30 per cent off' during May before again going on sale last month.

The Lee spokesperson agreed that constant sales by e-commerce companies was impacting their business. "We observed that our last sale in January had a slow start because e-commerce companies such as Flipkart were running discount promotions around their applications. But it picked up gradually," the spokesperson added.

As far as sales are concerned, it is more of a herd concept. Once a few brands decide to go on sale, everyone else quickly follows suit in order to not lose out to the competition. Malls, on the other hand, are doing their bit to create excitement among consumers.

The Kourm Mall in Thane on the outskirts of Mumbai has come up with an offer where shoppers need to be in their pajamas. The mall is also hosting a flat 50 per cent sale on 90 brands. Viviana, another mall in the same area, has organised a lucky draw where shoppers can win up to 1 kg of gold.

Pinaki Ranjan Mishra, partner and national leader, EY, said advancing sales could be to offset the risk from online discounting. "In the last three years e-commerce companies have had the single biggest impact on offline retailers and there are clear indications of a dent in apparel sales," added Mishra.

Business Standard had reported earlier that retail companies, which had witnessed a continuous fall in same-store sales in 2014-15, had been resorting to deep discounts and promotional offers to win back customers. They expect sales to pick up by October, when the festival season kicks in.