Secrets unboxed from Snapdeal’s Diwali sale

E-tailer Snapdeal has revealed some interesting insights from their ‘Unbox Diwali Sale’ this year, indicating a significant evolution in consumer behaviour. The most surprising trend was the sharp increase in willingness of customers across India to pay by card at the time of making the purchase instead of opting for cash on delivery (COD). “This was in part driven by Snapdeal’s partnerships with eight leading banks this Diwali…,” Snapdeal said in a statement.

The trend is significant as COD as a mode of payment has been a threat to all e-commerce companies because most courier companies charge extra for collecting cash. This cost is usually divided in two parts – fixed cost and variable cost (typically 1-3 per cent of the COD amount). For low-priced items, the COD charges can at times exceed one’s margin in the product and if the item is priced high, the COD charge may turn out to be in hundreds or even thousands. Apart from cost, COD results in delays in payments and deliveries, higher returns and cancellations, and increased overheads and logistics costs. So, the change in consumer behaviour to making payments at the time of purchase has indeed come as a sigh of relief for the e-commerce players.

Snapdeal claims that its biggest card-based discounts – a maximum of Rs 10,000 off on the iPhone 7 – turned out to be immensely popular among consumers.

The e-tailer’s data also showed that customers who bought electronics and furniture were the most likely to go for prepaid options. Among the cities, Trivandrum had the highest share of prepaid orders, constituting a whopping 85 per cent of the total orders from the city. The preference for prepaid transactions was the strongest in South India, followed by North, West and East, in that order.

Customers also showed a clear affinity for larger premium appliances. 60 per cent of all LED TVs sold on Snapdeal had more than 40 inches screen size. Among refrigerators, 70 per cent of the models bought were of more than 300 litres of capacity.

Another interesting trend observed was the increase in repeat usage. More than 6.25 lakh users ordered more than 5 products and nearly 1.1 lakh users ordered more than 10 products during Snapdeal’s ‘Unbox Diwali Sale’. The highest number of products that a single customer ordered during the festive season was a whopping 84.

A little more than 60 per cent of the orders came from tier 2 cities and beyond. More than 82 per cent of the overall orders were placed through mobile platforms. Highest numbers of units ordered were for the fashion category, followed by home, electronics and mobiles in that order. In the fashion category, women’s ethnic wear was the most popular purchase.

On the seller’s side, out of the more than 300,000 sellers on the platform, more than 32,000 sellers saw sales grow 7x from the last Diwali season, Snapdeal said.