Now, offline retailers fear mega Google fest

Say it will be the end of brick & mortar, rake up issue with Finance Minister

Google’s online shopping festival (GOSF), slated to start on December 10, might face greater resistance from traditional retailers compared to that faced by Flipkart during its recent Big Billion Day sale. While Flipkart clocked $100-million gross-merchandise-value (GMV) sale within 10 hours of the kick-off of its one-day festival, the Google event holds out a bigger threat, as not only will it be spread over three days, it will also have more sellers and categories.

Around 300 retailers and traders across categories such as real estate, consumer durables, travel, fashion and accessories are set to participate in the Google shopping festival.

The Confederation of All India Traders (CAIT), a body comprising medium and small retailers, has registered a protest with Finance Minister Arun Jaitley, saying the sale on Google, with larger data resources than Flipkart or Amazon, could be a disaster for brick-and-mortar retailers. Recently, the big boys of Indian retail such as Reliance Industries, ITC and Aditya Birla Group had complained to the ministries of finance and commerce about predatory pricing and lack of clarity regarding e-commerce in India.

GOSF, an annual event, comes at a time when offline and online retailers are locked in a battle for market share in the $600-billion retail segment in India. The latest trigger in the battle was the proposed launch of a book by President Pranab Mukherjee exclusively on Amazon, with offline chains threatening boycott of the publisher.

Now, telecom company Micromax is planning to launch a new Canvas phone exclusively on Flipkart.

RETAIL WAR INTENSIFIES

• GOSF is being seen as a bigger threat to traditional retail than Flipkart’s Big Billion Day
• GOSF will begin on December 10 and go on for three days, with exclusive launches and offers for first-time buyers
• Traders body CAIT has taken up the matter with Finance Minister Arun Jaitely
• Predatory pricing and exclusive online deals have come under fire from offline retailers
• Google is eyeing 100 million consumers in 2014 via GOSF
• Last year, 30 per cent of buyers at the festival were first-time buyers

“Via Gmail, Google has a larger share of the database to rope in consumers in the festival. Exclusive launches and mega discounts will be doled out during the three-day festival. Such a trend from our e-commerce counterparts is detrimental for offline sellers,” said Praveen Khandelwal of CAIT, adding his association would take up the issue of Micromax’s exclusive launch on Flipkart, too.

The Google festival will draw new customers through exclusive offers and mega discounts to first-time buyers. “Last year, about 30 per cent of the buyers made first-time online purchases during GOSF; this year, we have worked hard to make it even more exciting for the first-time shopper. We have partnered about 450 industry players and have created a special Rs 299 corner, with free shipping and a cash-on-delivery option,” said Nitin Bawankule, industry director (eCommerce- local and classifieds), Google India.

This is the third year when Google is hosting the festival in India. Through GOSF, the company aims to target 100 million consumers this year.

Last year, two million users had logged on to the gosf.in website, while about 16 million users visited partner sites, including smaller players, whose daily sales rose twice on an average, claimed Google.

The Google India management is bullish on the festival, as it feels consumer confidence on online shopping has grown considerably in the past six months.

According to a report by the company, the Indian e-commerce segment will hit the $15-billion mark in the next two years. As of now, the sector is worth about $4 billion.