Tuesday, July 27, 2021

Amazon launches month-long sale in battle for Indian wallets

Pandemic lockdowns have created pent-up spending demand.

Amazon.com is extending its Diwali sales event to an entire month this year, hoping to outdo rival Walmart’s Flipkart in the race to unlock latent demand as India’s shoppers emerge from drawn-out pandemic lockdowns.

Both Seattle-based Amazon and Flipkart are pulling out all the stops for the country’s most important shopping season, which starts in mid-October. But unlike Flipkart, which is sticking to a six-day event, Amazon plans to keep the discounts going right up to the mid-November Diwali celebration, having seen a 60% surge in new merchants on its platform.

“This is a long season of festivities and our celebration has been designed to run through its entire duration,” Manish Tiwary, Vice President of Amazon India’s consumer business, said in a virtual media event.

As the American rivalry heats up in the world’s largest untapped e-commerce market, the two giants will clash for the first time with a new homegrown competitor, Reliance Industries’ JioMart. The online shopping platform of India’s largest conglomerate has already begun advertising discounts and deals for everything from groceries and fashion to home decor.

The U.S. retail goliaths have been warring in the second-most populous country, half a world away, since Walmart acquired control of local online retailer Flipkart Online Services for $16 billion two years ago. Amazon has itself poured $6.5 billion into its India operations. This year, both have invested in excess of $1 billion to build up their capabilities and declared that they are making “long-term” bets on the country. Meanwhile, Reliance has raised about $24 billion from big-name U.S. investors like Facebook and Alphabet’s Google for its digital services and retail units.

To meet the demand spike, Amazon said it has created 100,000 seasonal jobs and plans to open 10 new fulfillment centers to warehouse products from its 650,000 sellers. Flipkart announced that it would add 70,000 positions.

Adding a new element this year, both have also recruited thousands of local stores to serve customers. Amazon said over 20,000 small stores have signed on to its Local Shops program over five months to sell basics like household essentials and fresh flowers. Flipkart said it has enrolled over 50,000 retailers to deliver in more than 850 Indian cities. It has also unveiled a wholesale digital marketplace connecting manufacturers with sellers.

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