MUMBAI (NewsRise) -- India's top two e-commerce companies, Amazon and Flipkart Internet, saw blockbuster shopping on the opening day of their much-awaited annual sale, defying concerns about slowing consumption in Asia's third-largest economy.
Flipkart Internet, backed by U.S. retailer Walmart, said the first day of its Big Billion Day saw sales doubling on the back of strong demand from smaller towns and cities. Rival Amazon, which entered India almost seven years after Flipkart in 2014, claimed it posted record sales worth about 7.50 billion rupees ($106 million) in 36 hours in categories such as premium smartphone brands -- OnePlus, Samsung and Apple -- on the first day of its Great Indian Festival sales. The sales of large appliances and televisions expanded nearly 10-fold over an average business day, it said in a statement.
The annual sale event of Flipkart and Amazon has begun to feature more prominently in the country's shopping calendar over the past four years, providing companies a major opportunity to grow revenue by tapping into festive season demand. Such sales are typically held ahead of Diwali, the most prominent Hindu festival, which falls in October this year.
"By all indications, this is going to be the biggest festive season that India has witnessed," Kalyan Krishnamurthy, the chief executive of Flipkart, said in a statement last night. "There is no doubt that e-commerce has not only lifted consumer sentiment, but has also driven the industry to set new bench marks."
There were more new online shoppers than ever, and more than 91% of the customers came from smaller towns and cities, Amazon said. More customers opted for installment payment offerings, which saw a threefold increase, it added.
Amazon also said it saw record sign up for its Prime loyalty program membership, which offers exclusive access to early delivery as well as music and video streaming services.
The six-day festival sales, which started on Sept. 29, is a key event for both the companies that are fighting to grab more customers and market share in one of the fastest-growing internet markets in the world.
Meanwhile, the event is keenly watched by industry experts as consumption spending in India sagged amid a liquidity crunch that sapped the availability of credit. India's gross domestic product expanded at the slowest pace in almost six years between April and June.
Credit Suisse earlier this month said India's consumer goods companies are likely to report the worst revenue growth in 15 years. A report by data analytics firm Kantar said consumer spending on Indian online sites slumped by a fifth in the first six months of this year. The persisting weak demand has pushed the government to offer tax cuts and a slew of sentiment boosting measures to drive up consumption.
Forrester Research had, last week, forecast online retailers to generate $4.8 billion in sales during the monthlong festive period between Sept. 25 and Oct. 29, mitigating the impact of the economic slowdown. It expected about 80% of sales to happen during the six-day sales event of Flipkart and Amazon.
"It is the value that the customer is looking for that's driving this sales boom," said Satish Meena, a senior analyst at Forrester Research. The online companies are offering sharp discounts, sometimes running up to 50%, Meena said, adding that more customers in smaller towns and cities are now confident of doing online purchases.
--Dhanya Ann Thoppil