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Avinash \n Bhat, The New Indian Express<\/i><\/p>\n Avinash \n Bhat, The New Indian Express<\/i><\/p>\n
Bangalore, \n 6 October 2014<\/i><\/p>\n
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\n As Diwali approaches, brick-and-mortar retailers are scrambling \n to compete with online websites offering hefty discounts to woo \n shoppers.<\/p>\n
Offers like one-plus-one and 50% discounts are becoming the norm \n across shops.<\/p>\n
This week, major online retailers like Snapdeal, Flipkart, Jabong \n and Amazon announced campaigns to target festival shoppers. Realising \n the need to compete, physical retailers are also offering huge \n discounts.<\/p>\n
The online market in India has been growing at a dizzying pace, \n and attracting huge investments. In 2014 alone, Flipkart raised \n $1 billion in funds while Amazon announced plans to invest $2 \n billion in business expansion. Snapdeal, another online retailer, \n attracted a sizeable investment by industry magnate Ratan Tata, \n who has put in an undisclosed amount into the Delhi-based company.<\/p>\n
According to a study by research firm Crisil in February this \n year, the online retail sector is estimated to grow at 50-55% \n for the next three years. Revenues have already touched Rs. 13,900 \n crore in 2012-13, and are likely to grow further as the online \n market share in the overall retail space still remains small.<\/p>\n
This growth has not escaped the attention of brick-and-mortar \n sellers, who are being compelled to ramp up their online presence. \n Trader associations have vowed not to supply goods to online retailers \n who sell below the market price. This has led to online retailers \n saying that they are mere marketplaces where the prices are decided \n by other sellers. <\/p>\n
As murky as the situation might be, consumers are the clear winners \n in the entire deal.<\/p>\n
“I have been buying products online for a long time now. \n They offer door delivery and in case I do not like the product, \n I can get it returned without having to go to a store and wait \n in line. This is much simpler,” says Arvind T, an HR professional \n in the city.<\/p>\n
“The offers are sometimes better or at least as good as \n the stores when you factor in the delivery and the ease of shopping \n online,” says Siddharth R, an IT professional.<\/p>\n
It is this ease of shopping online that is adversely affecting \n the more traditional methods of shopping, feels Devangshu Dutta, \n CEO of Third Eyesight, a retail consultancy.<\/b><\/p>\n
“Offline retailers have been investing in infrastructure \n since 2000, and there is high capital involved. As long as they \n are able to respond to these (online) offers, they do not have \n to match the discounts as they have a very large segment of touch \n and feel buyers,” he says.<\/b><\/p>\n
However, the writing on the wall is clear for physical stores, \n Dutta feels.<\/b><\/p>\n
“They need to match the service offered by the online \n sites. With assured service backup with online retailers, customers \n will go for the lowest priced products and a difference of even \n `200-400 could be a deal breaker for some,” he says.<\/b><\/p>\n
Diwali sales under way<\/b><\/i><\/p>\n