{"id":2465,"date":"2016-10-18T09:06:00","date_gmt":"2016-10-18T09:06:00","guid":{"rendered":"https:\/\/www.thirdeyesight.in\/?p=2465"},"modified":"2022-09-15T10:32:18","modified_gmt":"2022-09-15T10:32:18","slug":"are-flipkart-amazon-discount-sales-affecting-white-goods-brand-perception","status":"publish","type":"post","link":"https:\/\/myechoproject.com\/TES\/are-flipkart-amazon-discount-sales-affecting-white-goods-brand-perception\/","title":{"rendered":"Are Flipkart, Amazon discount sales affecting white goods brand perception?\u00a0"},"content":{"rendered":"\n

Firstpost
\nNew Delhi, 18 October 2016<\/i><\/p>\n

\"\"Online festival sales and the big billion day\nsales are presumably happy times for customers going by the units sold\nclaims by online market places. However, they are creating much\nheartburn for some of the white good manufacturers whose products are\nbeing sold at prices below what they are being sold at the company\nshowrooms or at the retailer’s end.
\n
\nThe combined sales of all the three e-commerce entities in the recently\nconcluded five day big billion day sale spectacle was pegged at around\nRs 6,500 crore, up 20 percent over the previous year, according a\nreport in The Financial Express.
\n 
\nThe Bengaluru-headquartered Flipkart pipped its nearest US-based online\nretail giant Amazon’s Indian arm with 15.5 million units sold against\nthe latter’s 15 million units.
\n
\nWhite goods manufacturers are now crying foul at the heavy discounts\nbeing offered, according to The Economic Times.
<\/p>

\nIt isn’t that the discounts offered by online marketplaces are really\nthat huge on all the products, says Nilesh Gupta, Managing Director,\nVijay Sales, consumer electronics chain. He sees online as a space that\ncreates a market for goods.
<\/p>

\n“Though consumers check for white goods and electronics online, the\npurchases are made offline, usually. The prices of the white goods and\nelectronics are not hugely different to impact offline sales or\nmarket,” he says.
\n
\nConsumers don’t make large ticket purchases of white goods\nperiodically, says Gupta. When they do realise that if the product\nbrought online is not being repaired by after-sales service of the\ncompany, then consumers will be cautious on buying these items.
\n
\nIt is a myth that is being created by the online marketplaces that they\noffer ‘discounts’ during festival periods, says Gupta. “It is only\noffered for select products and not across all product categories. On\nwhite goods too, discounts are minimal. I see this discounting by\nonline marketplaces as a disturbance for offline businesses for 3-4\ndays and then it dies down. The online sales and discounts are a\ntemporary phenomenon,” says Gupta, dismissing the fuss over large-scale\ndiscounts and sales bonanza that online marketplaces whip up\nperiodically. “The discounts are hardly much,” he says.
\n
\nIt is worrisome, though, some say that not all white goods sold come\nwith a warranty, while some concur that they are basically clearance\nsales. Even those who claim that goods sold on the marketplaces are\ngoods which are not in demand are worried over potential loss of\nreputation for the company. That is one of the reasons why besides the\noft-voiced complaint of vendors and retailers associations, white goods\nmanufacturers too are now raising the pitch against discounts offered\nby online marketplaces.
\n
\nCompanies want to protect the price points at which their products are\nsold and would not want a marketplace to lower it than what they offer\noffline. “When the price of a product is knocked down on a marketplace,\nfor instance, it affects the brand’s perception in the consumer’s mind\nand also at the dealers,” says Devangshu Dutta, Third Eyesight.<\/span>
\n
\nIndian rules allow for a Maximum Retail Price (MRP), but since there\nare no rules yet to take action on anyone who sells below it, they can\nbe sold by marketplaces at below MRP under the guise of discounts and\nsales, informs an analyst.
\n
\nThough everyone wants to sell products at ‘exciting’ prices cashing in\non festival period sales, aggressive discounts can impact the brand’s\ncredibility with the trade.
\n
\nThe consumer runs the risk of getting a product that does not offer a\nwarranty and the company not willing to do after-sales service. When\nthat happens, the brand’s credibility goes down for the consumer as\nwell.
\n
\nBut some brands do have contracts that do not allow for their products\nbeing sold at the contractual price.
\n
\nFor instance, furniture. Godrej Interio has a contract drawn up with\nonline marketplaces which do not allow for the latter to sell their\nproducts at a rate below what is stipulated.
\n
\n“We work with a lot of marketplaces. We deliver the products though it\nis sold online through a marketplace. Marketplaces do not have an\ninventory for our products. We don’t encourage a price advantage that\ngoes against any of the channels through which our products are sold,”\nsays Bedraj Tripathy, Marketing Head, Godrej Interio.
\n
\nThe company also does its own checks on marketplaces to ensure that\ntheir products are not sold at prices below what has been mandated\nthrough the contract.
\n<\/span><\/p>\n

<\/span>(Published\nin Firstpost<\/span><\/a>)<\/i>\n<\/p>\n","protected":false},"excerpt":{"rendered":"

Firstpost New Delhi, 18 October 2016 Online festival sales and the big billion day sales are presumably happy times for customers going by the units sold claims by online market places. 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