Flipkart is claiming strong market leadership as its biggest sale event of the year, Big Billion Days, comes to a close. Flipkart CEO Kalyan Krishnamurthy says the company had over 70 percent market share in fashion, mobile phones and appliances - the top three categories for Flipkart and also for the online retail industry in the country.
He says if the sales numbers for Myntra and Jabong are considered then the market share in fashion goes up to 80 percent. Overall, Kalyan says, Flipkart's Gross Merchandise Value (GMV) during the sale doubled over last year's BBD. He declined to share absolute numbers. However, according to industry analysts Flipkart Group had sales of over Rs 3,000 crore or around $460 million. So double that number would be a little under $1 billion. The company had claimed on Thursday that it sold 1.3 million smartphones in 20 hours.
The momentum has been on Flipkart's side before the sales started - Amazon, Paytm and Snapdeal too announced their festive season sales on the same dates as the Bengaluru-based e-commerce major. Flipkart's mammoth $4 billion fund raise in 2017, lead in smartphone category with an over 50 percent market share and numerous launches including private labels and furniture helped build buzz. A survey by advisory firm RedSeer Consulting found that about 80 percent of respondents intended to buy from Flipkart during the sale. This could translate into a strong consolidation of its market leadership position. Flipkart (not including Myntra) captured 43 percent of the GMV sold last festive season, compared to Amazon's 32 percent. An Amazon official told news agency PTI said that this year's Great Indian Festival - the name of its sale - was the biggest ever for the company in India with 2.5X growth in smartphone sales, 4X increase in large appliances and 7X in fashion sales. Amazon too has not shared absolute numbers.
In a chat with YourStory, Kalyan shares the top trends and data of this year's BBD. Edited excerpts:
YS: What has Flipkart's performance been like this BBD?
Kalyan: Every year BBD is more an event that gives customers very high value. This time in addition to doing that we are giving huge amount of unique selection. Many brands are exclusively on Flipkart. We want the country to not just experience good prices but also great selection. We started on an affordability journey last year, offering schemes like no-cost EMI, buy-now-pay-later and product exchange. All this has become big this BBD. We wanted to offer unique experiences across touch points and we have achieved that very well this year. In terms of numbers, our sales was roughly double of last year's BBD. In fashion we captured 70 percent market share (80 percent when we include Myntra and Jabong), in mobile 70 percent and in appliances 70 percent. We want to get into the mode of expanding the overall market. In terms of order numbers lifestyle is our biggest category and in terms of value or GMV mobile is the largest.
YS: What's the overall GMV?
Kalyan: We are not sharing absolute numbers.
YS: After all these years of e-commerce, mobile category is still the largest. Isn't that a matter of concern?
Kalyan: From a unit point of view mobile is a distant second to the lifestyle category. It is in value that mobile becomes big. It is a fact that the country is buying mobile. There is a revolution going on there and we are proud that customers have chosen us as a destination for mobile. We are very happy about participating in this secular trend of everyone having a high quality smartphone. We are not thinking about whether it is too big or too small
YS: BBD is a good means of getting new customers to shop online for the first time. How's the performance been on that count?
Kalyan: Our overall customer count has doubled and one-third of them are new customers.
YS: You have launched a number of schemes to ensure affordability (beyond discounts). What has the impact been of these schemes on sales?
Kalyan: Our initiatives like no-cost EMI, Buy Back, product exchange etc have had a good impact. About one-thrrd of our GMV had some kind of affordability link. Also, the share of prepaid has gone up, with an addition of 10 points over last year. Now it is over 50 percent.
YS: What about your small town reach?
Kalyan: There is a movement in favour of Tier-II and III cities and towns. About 45 percent of our sales came from these areas versus 40 percent last year.
YS: You have launched a number of private labels. How have they performed?
Kalyan: Still early for us to talk about this in detail but initial response is encouraging. For instance, when we launched furniture 10 days before BBD we led with private label (Perfect Homes). We stocked out in two and a half days. We intend to invest heavily in this category in next two years.
YS: What can we expect from Flipkart in the near term?
Kalyan: Every product category we launch we take a year to build; we are very long term in our focus. We want to exponentially increase the number of customers who shop online. That number is still small. The country is under indexed in terms of women shoppers. We are focused on expanding that. We are focused on improving the repeat user metric. These are the metrics we are focused on.
YS: You were supposed to launch grocery before festive season. When will you launch this category?
Kalyan: You will buy grocery fairly soon on Flipkart.