Flipkart to put 99pc fashion items on sale, aims 40pc market share in sector
In an unprecedented move for any online marketplace in India, e-commerce leader Flipkart is going all out with its latest sale event. Flipkart is celebrating its tenth anniversary with ‘Big10’ fashion sale from May 14 to 19 – with 99 percent of its items on sale for the first time.
The move is expected to build not just a bigger basket size, but also bring in more first-time customers as well as bring back those customers who have been inactive. The company claims that over 40 percent of its offerings during the Big 10 Sale will be exclusives. Discounts will vary from 20 to 80 percent.
‘Bid and win’ is another channel for customer engagement for the sale. Certain products are given at a low price, and the lowest unique bid wins. It has to be unique offer – if more than one customer calls for the same amount it will be invalid. It includes items from Fossil watch worth Rs 18,000 to memorabilia like Sachin Tendulkar’s signed bat.
A unique move
What was the thought process behind putting 99 percent of items on sale? Rishi Vasudev, VP Fashion at Flipkart, says, “Many consumers worry if they are getting the best price, since discounts happen only for a few items during sales. But this is a genuine sale with more than 80 lakh styles in fashion. So 99 percent of all prices are better than on a normal day.”
However, the unit economics here does not bother Rishi. He says, “Sellers are providing the discounts directly. This brings higher footfall to our website, which benefits brands and sellers. Hence they give the best prices.” He adds that at any point in time, one percent will be on no discount.
“Every day on Flipkart, lakhs of products go live in the background - these are uploaded by a long tail of sellers. Majority of these are opted in for discount by marketplace sellers after they go live in subsequent days only,” he explains.
Flipkart has always had a stronghold in fashion. In fact, 60 percent of their customer base shops in fashion. This is one category – unlike electronics and mobile phones – which can be built on exclusivity as the margins are the highest.
For the Big 10 sale, Flipkart claims to have significantly scaled up the number of exclusives across top brands. It is also offering a product line specially curated for the sale in association with leading brands. Wrangler, Woodland, Fossil, and Ferrari are among the brands that will constitute of 40 percent of all products offered during the Big 10 sale.
According to Rishi, they have put in many months’ efforts in terms of procuring inventory, deploying enough manpower, and arranging fast delivery (as per the normal scale). He adds that offers will be made using machine learning. “Some parts of the store will be different for each customer during the sale – depending on their purchase history.”
Flipkart has extensively studied fashion trends and consumer shopping behaviour over the past six months to develop these exclusive ranges. These will only sell on Flipkart during the sale days contributing close to 40 percent of fashion business on the platform during the sale.
Flipkart already claims to have 30 percent market share in fashion; and the alliance with Myntra and Jabong claims 70 percent. This year, Flipkart wants to raise its market share to 40 percent, says Rishi.
If done right, this can establish Flipkart’s upper hand over arch rival Amazon, which has not had much luck in the fashion category so far. In a bid to profitability, Flipkart has been building private label products under the umbrella brand of Flipkart Smartbuy. They have already launched electronics and home categories, and fashion was earlier said to be announced in April. But no announcements have been made on this regard so far.