Festivals a GMV machine for e-tailers

It's not only Flipkart, Snapdeal, Amazon and Paytm which have already set the tone for festival shopping. eBay, Shopclues and Craftsvilla are getting into the act too. In fact, the three are targeting $1 billion GMV (gross merchandise volume) of products sold at the end of the year, while banking a great deal on Diwali frenzy, as well as on the next wedding season.

The inspiration could well be the big boys. Flipkart, which will begin its Big Billion Day sale on October 13, had clocked a GMV of $100 million in 10 hours last Diwali. Snapdeal, which has already had its Diwali sales preview earlier this week, boasted of sales that were valued at Rs 1 crore a minute (similar to $100 million in 10 hours).

While 75 per cent of online shopping is expected on the big four websites in the next three months, it leaves 25 per cent of the market for most of the other players.

Some like Craftsvilla do not plan to offer steep discounts. "We have made most of our sales without taking anything away from either our sellers or the company," said Manoj Gupta, co-founder, Craftsvilla.

eBay, on the other hand, talks of discounts of up to 75 per cent, but is trying to drag focus to their newly-assembled refurbished product category, which they hope will woo the tier-II and tier-III customers.

While direct communication and digital campaigns seem to be the means of choice to communicate with their customers, television ads are the go-to options as well.

"We have put aside Rs 50-60 crore for marketing. The ads will hit TV screens in the second week of October," Gupta added. Shopclues will launch a marketing blitz, including television ads, in the next week, too.

The companies, having learnt from Flipkart's glitches last year, started working on strengthening their information technology (IT) infrastructure and logistics four months ago. "We made strategic hires to beef up our IT staff, so we can handle the load. We expect the traffic to jump 80-100 per cent this year," said Nitin Agarwal, co-founder of Shopclues. Others like Craftsvilla have tied up with four additional logistics partners and ebay has added to their customer support staff along with tying up with India Post.

Another part of the strategy has also been seller acquisition. Craftsvila believes that its existing three million sellers will be enough; Shopclues has added 170,000 new merchants the past seven months, while ebay has a total of 60,000 sellers, including international ones.

Companies have also incentivised sellers by a long credit limit. "We have even set up a credit programme for the sellers where we will offer a Rs 47-crore limit to certain sellers," said Agarwal. Shopclues plans to include fitness products to expand its reach.

While most companies achieve a majority of their GMV target during the next two months, Craftsvilla would wait a bit longer. "We don't go on a big spending spree during the season when the prices are high. We wait until December. Last year, we clocked our highest sales in January during the wedding season. It is the next frontier," said Gupta.