Web-focused smartphone and electronic brands said business on online marketplaces has returned to normal levels after New Delhi’s changes to overseas ownership rules disrupted sales early February at the two biggest industry platforms, Walmart-owned Flipkart and Amazon.
The rebound is pronounced enough for brands such as OnePlus, Realme, Vu, TCL, iFFalcon, BPL, Kodak and Thomson to suggest that online promotions — exchange offers, finance schemes and aggressive pricing — in the second half of February helped them boost business last month even though many of these brands had altogether disappeared from Amazon in the first week. Even on Flipkart, promotions were less in the first week of February.
Executives said these brands expanded upward of 10% last fiscal and have lined up aggressive growth plans built around big-ticket summer events, such as the cricket World Cup.
Amazon-focused premium smartphone maker OnePlus India general manager Vikas Agarwal said there was no disruption in online sales last month and business is sticking to the January-to-March quarterly plans.
Online-focused smartphone maker Realme India CEO Madhav Sheth said foreign direct investment rules are in the interest of the sellers, giving them the opportunity to directly deal with the brands.
“Due to high demand, our stocks sell out very fast; hence our sales were not affected due to the change in policy,” he said.
CEO of TV-set maker Vu, Devita Saraf, said aided by promotions, the brand sold as many sets in January as it did in November, while in February several models ran out of stock. “Consumers are still looking for good deals and value-for-money products in ecommerce,” she said.
A spokesperson at iFFalcon, TCL’s smart TV brand, said sales are back to normal after the initial disruption in February, backed with promotions such as exchange offers, easy financing and aggressive pricing. The licensee of Kodak and Thomson TV brands, Super Plastronics CEO Avneet Singh Marwah, said the Kodak brand grew volume sales 60% in February, while Thomson was sold out in a few cities. “The effect of ecommerce regulations has fizzled out,” he said.
Amazon’s top sellers such as Cloudtail and Appario Retail, which deal with online-focused electronics and smartphones, had largely been absent in the first seven days of February. They returned subsequently after Amazon reduced its shareholding in both the entities to make them compliant with the new FDI regulation. Both Flipkart and Amazon also roped in several new sellers for these two categories to be compliant.
Amazon-exclusive BPL’s COO Manmohan Ganesh said brands are now preparing for air-conditioner sales during the summer. “Targeted online promotions will continue in the next couple of months as consumers tend to shy away now since examinations and elections are round the corner,” he said.
This optimism comes on the back of scepticism from industry analysts that online sales would slow for categories such as smartphones due to the new regulations, which would impact discounting and promotions. Smartphones and electronics are the two largest categories online, accounting for about 55-60% of the total business.
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