Whenever someone decides to write a book on India's e-commerce story, flipkart will find a special mention in it. It is responsible for getting people, who were used to buying things after physically examining them, to shop online at a scale unprecedented in India's history. Personally speaking, all my limited online purchases have happened through flipkart only. So flipkart's 'big billion sale day' came as a huge respite for the masses planning their Diwali shopping! Snapdeal also announced its own version of the 'big discount day'. The sale started with a lot of fanfare with millions logging in to find the best deals. By evening both the marketplaces claimed to have sold about Rs.600 cr worth of merchandise each!
But the good news ended just there. Number of people took to social media platform to vent out their anger against flipkart for reasons varying from technical issues preventing them completing transactions, cancellation of orders, for things getting sold out in no time, basically questioning the authenticity of the sale. 'The big billion sale day' turned into the 'the big goof-up watched by a billion plus population'. (It is amazing how the same social media which you use to create buzz about your upcoming launches can turn against you in case you fall short of expectations. It works either ways you see! Another element of social media worth noting is the speed at which news spreads. People knew something went wrong with the sale day even before the companies could announce their sales figures for the day!)
Whereas I do not question the authenticity of the overall theme of the discount day (who would purposely want to mess up their own special day), I think the only thing that could have gone wrong was the manner in which they approached it. My argument is as follows: from the day it started it has been in news for all the right reasons be it being responsible for bringing about path-breaking changes in how India shopped, to acquiring Myntra, to raising $1 billion etc. They were under pressure to make this day special. There were huge expectations from all quarters. A company which was already selling goods at discounted prices was expected to do something extraordinary. And of course the fear of competition: with snapdeal and amazon planning their own version of sale day/week, flipkart wanted to make theirs bigger, better and more memorable.
All these factors combined made them go overboard with the sale and in the process they couldn't foresee the problems coming their way. Cynics may argue here saying the technical errors are understandable but the inventory levels could be better handled. In retrospect, we can say a lot of things but let us just give it to them for putting up such a great show as, I am sure, they would have put in their heart and soul to make it a memorable one. They were humble enough to issue an apology with clarifications. They surely have learnt their lessons (and the competitors too!)
Amazon may have had the first mover advantage in this business category worldwide; flipkart had the same honors in India. The 'sale day' first mover advantage again went to flipkart and snapdeal but it ended up saving the day for the second mover (amazon) in this case. Amazon would have become more cautious with their 'amazing week' campaign! (Please note the word play here!)
What this development has led to is even more interesting than the development itself! Future group has termed this exercise of ‘jaw-dropping prices’ as unfair saying the predatory pricing impacts the brick-n-mortar stores in general which tend to lose out. One would have thought this would lead to a court battle between the marketplaces and large retailers having brick-n-mortar stores but then came the news that future group has tied up with amazon to market its products, followed by another news where nerolac tied up with flipkart to sell their products online. Synergy is the way to go! And there could be many such possibilities where the marketplaces like flipkart/snapdeal could partner with the brick-n-mortar companies to capitalize on each other’s strengths. I just read yesterday: amazon has decided to open a brick-n-mortar store in USA! It will act as pick up and return store to start with but just the developments that have happened in last few months re-emphasises that we can expect the unexpected in future!
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