Aich, Kavya Balaji, Tania Kishore Jaleel, Vivina Vishwanathan
& Lisa Pallavi Barbora, MINT
Delhi, 9 November 2015
are in the midst of the festival season and there has been a barrage
of offers across various sectors. Numerous advertisements from
both online and offline retailers could be seen as early as September.
This time, the e-tailers have tried to one up the brick-and-mortar
peers by offering app-only deals. While much of the festival season
is left, it has been strong going so far. A recent Nomura Global
Markets Research reportHoliday shopping season starts with
a bangsaid that quarterly expectations for Indias
holiday sales are close to $4 billion. Read some of the other
findings from the report with the stories. While most of the action
seems to be online, offline retailers are trying to keep pace,
if not in price then in service and customer experience. Mint
Money takes a close look at different types of offers and how
one can be a smart shopper. We take a look at popular segments
of electronic gadgets, white goods, apparel, jewellery, furniture,
and even real estate and gold, and bring to light some of the
In todays world, where technology upgrades at a fast pace,
everyone wants to own the latest gadget as soon as it hits the
market. The festival season adds fuel to the fire, with buyers
spoilt for choice on both online and offline platforms.
This year, e-commerce participants managed to grab the first
movers advantage and started their festival season sales
as early as September-end. Earlier, the biggest sales used to
happen closer to the main festivals.
You may have seen many advertisements by online portals in newspapers
last month, and these are still continuing. In fact, according
to a recent report by Nomura, in the sales by the three top ecommerce
marketplacesFlipkart, Snapdeal and Amazon Indiamobile
phones were the biggest selling category, followed by apparel.
Mobile phones are also high demand because manufacturers come
up with new models almost every other month. Moreover, festival
season sales woo customers by giving offers and best-price
on their favourite gadgets. Among these, Apples iPhone has
been a hot favourite with Indian customers. Mint compared prices
of iPhone 6 16 GB across the mobile apps of the top three online
retailers, and brick-and-mortar storesCroma, Spice Hotspot
and Vijay Salesduring the festive season sale on 15 and
While physical stores were far behind in the price offering,
online stores did offer good discounts. However, the maximum retail
price (MRP) had high variations across e-tailers as well, which,
in turn, meant big differences in the discounts offered. Even
as Snapdeal and Amazon offered the phone at the same price of
Rs.37,999, the former showed an MRP of Rs.56,000 and the latter
of Rs.52,000, making a difference of around 5 percentage points
in the discounts offered by the two.
The difference in MRP is mostly due to the different
prices offered by the sellers on the online retailers platform
(marketplaces). Also, it is a common practice in retailing to
mark up price by a big margin and then sell on a huge discount,
keeping the sales margin intact, said Devangshu Dutta, chief
executive officer, Third Eyesight, a retail consulting firm.
Apart from prices, the delivery time and charges also varied
across sellers on e-tailers.
While the variation in online prices was high, the selling price
quoted by physical retailers had miniscule or no discount on the
MRP. Moreover, their prices were much higher than what online
stores were offering. For example, for the Apple iPhone mentioned
earlier, the difference was at least 19.7%.
However, the benefit of paying the extra money is that you can
get the product at once. Also, the process of exchange is simpler
as you dont have to wait for the replacement to be sent
as in the case of etailers. This factor is especially relevant
if you are buying a product whose online and offline price is
In October, Vipin Venugopal, a junior executive at a private
manpower solutions firm in Mumbai bought a shirt by Pepe Jeans
from an e-commerce website for Rs.600. The price of the
same shirt at the showroom was Rs.1,699. It was a steal,
said Venugopal. And seeing such mouthwatering discounts, Venugopal
bought more things online for his sister, Vidya. I bought
a total of seven items for my sister during the online discounts.
We had scanned showrooms for some kurtas, but online we ended
up getting at least 40% discounts, said Venugopal.
Going online to buy clothes could work in your favour, too.
According to a survey released in October by industry body Assocham,
the most popular e-commerce websitesFlipkart, Amazon, Snapdeal,
Myntra and Jabonghave been doling out price cuts or discounts
on purchase of popular brands of apparel, footwear and electronic
goods, coinciding with the festival period. The growing trend
is being attributed to the fact that all reputed Indian and international
brands have tied up with these websites and their goods are being
offered to consumers at much lower prices than in their retail
For the past couple of years, discounts on websites have
been good. The discounts are now coming down but the reality is
that consumers are checking out online platforms for apparel.
When it comes to clothes, so far, pricing has been the key parameter
rather than convenience, said Saloni Nangia, president,
Technopak Advisors Pvt. Ltd, a New Delhi-based retail consulting
Mint did an online and offline survey of major apparel brands
and found that select products available on e-commerce websites
were cheaper by up to 20% as compared with the same products in
Most of the discounts are given by the portals directly
for customer acquisition and I dont see this changing in
the next 18-20 months at least, said Nangia. According to
an April report by UBS Securities India Pvt. Ltd, by the end of
the calendar year, fashionwear, including apparel and footwear,
is expected to be the largest retail category online, with sales
of $3.9 billion, bigger than sales of electronics and consumer
durables at $3.5 billion.
Retail analysts also believe that as Indians evolve in terms
of fashion, buyers will slowly move towards curated merchandising
than just looking at discounts.
You can expect niche businesses to evolve where discounted
pricing may not be available, said Nangia.
What you get
E-commerce websites, too, are evolving. Some of them now provide
trend and style guides along with discounts. Flipkart, for instance,
has a feature called Image Search where you can browse
through an assortment of clothing. You can click on a picture
and search for similar products on the portals mobile app.
Many of us might be doing this: you go to a mall, and if you
like a product, immediately go online on your smartphone to check
for any price differential. However, before clicking on the Buy
Now option, do factor in other costs such a delivery charges,
if any. Apart from that, since most of the websites now act as
a marketplace (products are provided by multiple parties; transactions
go through the website), you may want to check the delivery duration
when buying from different sellers.
Earlier, if someone wanted to buy an appliance, she would go
to not one shop but many, look at the product, compare prices
and only then buy. But today, shoppers are willing to skip the
physical inspection and buy the product online if the price is
right. In fact, prices for white goods such as televisions, washing
machines and refrigerators are usually lesser online than in-store.
For instance, the Samsung 32J6300 32 inch Full HD Smart Curved
LED TV was available on Flipkart for Rs.42,290 while the price
was Rs.49,900 at the Samsung store. The same was the case for
an LG 6 Kg fully automatic top loading washing machine. The price
was Rs.13,770 on Amazon.in during its festive sale, while offline
store Croma was selling it at Rs.16,300. Another advantage of
buying online is that you can read reviews of other buyers before
you choose a product.
However, while buying online, it is important to compare prices
across sites and also look at the delivery and installation details.
It would be advisable to go through comments posted by other buyers
on social media websites or the portal itself, as sometimes the
installation and delivery is delayed or even improper. For instance,
Mayank Agarwal from Delhi bought an Onida AC from Flipkart. It
promised free standard installation, but the installation team
did not call or turn up even after 11 days. I was getting repeated
calls from Onida dealers who were charging Rs.1,500 for standard
installation, which was otherwise to be free. Mint had sent
an email to Flipkart seeking a comment regarding the complaint,
but the e-tailer did not respond.
Another issue is warranty and customer service. Online buyers
of large appliances often dont receive proper warranty or
customer service from the brand. Take the case of Vijay V. from
Chennai, who bought an LG refrigerator from Amazon. LG customer
service denied replacement of parts when I encountered a manufacturing
defect even though it was under warranty, said Vijay. In
an emailed response to Mint, an Amazon spokesperson said, If
the customer reaches out to us during the return window applicable
for that product category, we would initiate returns or replacement
of the product. Brands are obligated to honour the warranty for
a genuine product irrespective of the sale channel.
These just might be the reasons why it wont hurt to spend
some time and effort to check out in-store deals as well. Brick-and-mortar
stores have some advantages that online portals dont offer.
For example, you can bargain for a better price or ask for better
freebies. You can even ask the store if it can reduce the cost
of the freebies from the products cost. Also, the installation
and warranty might be much better as stores have in-house staff
for installation and give the warranty upfront along with the
As regards payment, the finance options are almost the same for
both. Equated monthly instalment (EMI) options are available with
most online and offline retailers. For in-store purchases, you
can make a downpayment, take the product and pay the rest as EMI.
Online purchases, however, require either full payment or full
amount needs to be converted to EMI. Also, in-store finance offers
include EMI at 0% interest; online retailers only offer EMI through
credit cards where processing fees might be high.
Its no surprise that you can now buy diamonds online; it
is convenient and the choice is immense. At the same time, unlike
buying a pressure cooker or even a mobile phone, you have to be
very discerning about buying jewellery. Its not a standardised
product; every piece of jewellery is unique. When you deliberate
jewellery shopping this festive season, consider your optionsonline
and offlineafter evaluating the merits.
According to Neha Kapadia, partner, Design Jewels, a Mumbai-based
jewellery store, Nine out of 10 times, jewellery is purchased
from the trusted family jeweller. This person knows
your taste, quality requirements and there is familiarity. Then
there are those who buy from bigger shops though this usually
turns out to be more expensive. But in buying online, the element
of negotiationbe it in price, design or qualityis
With your family jeweller, there is comfort in showing old pieces,
spending time talking about redesigning and creating a more contemporary
piece and that hits home. Most people dont really want to
buy jewellery in a hurry.
Moreover, festive and wedding jewellery are large spends. So,
one needs to be conscious about quality. While it is simpler to
understand the purity levels in gold, with diamond jewellery,
there are multiple factors to keep track of. Every stone has a
cut, colour, clarity and carat, according to which it is priced.
Its hard enough trying to decipher these on your own through
a website, let alone trying to figure out whether pricing matches
the specifications. However, jewellery bought online also comes
with a certificate, so the quality is assured.
Calvin John, vice-president, offline marketing, CaratLane.com,
said, In case of solitaires, we have certification from
only internationally accredited laboratories; for other jewellery,
there is Indian certification. As a first step, when a customer
makes a purchase, she can view the certification online itself.
And the certification is sent with the delivery.
When it comes to design, though, Internet is your oysteryou
can browse through not only traditional Indian designs but also
global trends. People often choose designs online and then
come to a store to get it made.
But this isnt new; earlier, too, designs were chosen from
magazines and other places. Only the medium has changed,
said Saurabh Gadgil, chairman and managing director of Maharashtra-based
PN Gadgil Jewellers.
The online experience is getting enhanced with mobile apps that
help you see how a pair of earrings or a necklace would look on
you (use the app to upload your photo and superimpose the chosen
pieces on it)sifting through hundreds of designs becomes
a job on the go. But the look and feel can be different on a screen
than on your person. For that, many retailers let you call the
piece home and try it on before you buy.
John said, The concept of looking for jewellery online
was far fetched till a few years ago. Now people have started
buying. The quality of user experience has evolved; we have a
3D virtual app to show how jewellery will look on you.
While online purchases offer various advantages, convenience
is the most important. Its too tempting; say, you have seen
a pair of gold and diamond earrings. They look nice and get delivered
right to your doorstep, along with the relevant certificates.
You avoid the traffic jams and the nasty look that the sales person
at the jewellery store gives after you decide not to buy any of
the 30 pairs that she has shown you. Moreover, as geographical
mobility increases, people may no longer have access to their
There is also a price advantage while buying online; experts
say prices could be cheaper by as much as 20-30% given that online
retailers dont have to keep an inventory of jewellery and
have almost no real estate cost to bear.
But the choice between online and offline isnt always simple.
Kapadia said, Despite certification, most people are not
well versed with quality and price specifications. So, most online
sales are restricted to smaller pieces, (usually) of lower quality
and smaller budgets.
You may not be ready to spend lakhs on buying diamond sets online,
but its convenient to try out a pair of contemporary earrings,
which will cost a few thousands, or, even buy standard gold coins
that you have to gift during the festival season. Many websites
offer a good return policy as well and have a try-at-home facility
for some of the products. You can leave your details on the website
and a counsellor will get in touch and bring you the desired pieces
to be tried at home. If you like something, you can immediately
make a payment. But if you dont like any piece, you are
not obligated to buy.
There are, however, some basic checks to do such as read the
return policy, compare prices based on quality, delivery time,
and others. Gadgil believes that the online jewellery platform
caters to a new segment and a customer will rely on both channels
for an overall experience. For heavy and high-value purchases,
however, customer behaviour is likely to remain biased towards
the family jeweller or a retail store.
Lisa Pallavi Barbora
New furniture also features in peoples festival buying
list, and this time around, many online portals are trying to
cash in on this. Just before the festive season began, e-tailers
Flipkart and Amazon.in started offering furniture on their websites
and apps. During its Big Billion Sale, Flipkart had dates dedicated
to this category of products. Furniture portal, Pepperfry, has
its ongoing Mega Diwali Sale with up to 51% off on products as
well as extra 10% cashback for purchases above Rs.40,000.
Offline retailers, too, have hefty discounts. Durian Industries
has up to 50% off on its products. Luxury furniture store, Furniturewalla,
too, has a similar offer. Even your local shops and markets will
have festival offers on.
Since the furniture market is largely unorganised, there isnt
a standard benchmark for prices. As an example, we looked at the
prices of a king-size bed with matt finish and storage. At Durian,
the post-discount price was Rs.53,000, on Pepperfry it was Rs.43,946,
and at Urban Ladder it was Rs.41,799.
E-tailers are able to offer steeper discounts because of the
margins they enjoy, said Arvind Singhal, founder and chairman
of Delhi-based retail consultancy, Technopak Advisors. Pricing
in this segment is opaque. There is a lack of transparency as
to how the pricing has been arrived at. The offline furniture
companies usually operate at a 60% margin over the retail price.
And online firms, it can be 10-15% above this, he said.
So, yes, the online prices seem better, but here a few things
to keep in mind before you start shopping. For instance, you cannot
opt for cash on delivery for more expensive items. At Pepperfry,
it is above Rs.3,000, and at Urban Ladder, above Rs.25,000 (no
such limits at brick-and-mortar stores). But you can pay via Net
banking, e-wallets and even in instalments.
Furniture online portals also offer much more choice, and because
of the convenience of being able to browse through many products
comfortably, many consumers are now making even big-ticket furniture
purchases online, said Kashyap Vadapalli, chief marketing officer,
However, not everyone is comfortable doing so. For example, Manish
Ambwani, a human resources professional from Delhi, recently purchased
a shelf for the living room from an online furniture portal. Both,
my wife and I work, so we did not have the time to go to different
shops to make a decision. But for now, I would still buy bigger
products from a store where I can see its quality, said
The other aspects that make shopping online convenient are quick
delivery and return policy. But this can be a cumbersome process
with furniture. Delhi-based Reena Singh, founder of Khushi Pediatric
Therapy Centre, wanted to buy a green coloured bookshelf to match
the colour of her organisations sign. Since she usually
does most of her shopping (be it clothes, home appliances and
gadgets) online, she thought to give furniture a go. But not only
did it take a month for the bookshelf to arrive, it was in a different
colour (turquoise blue). Though she immediately returned the shelf,
it took another month to get the refund.
Read product details carefully when buying onlinesize,
material, care instructions, warranty, shipping, payment and refund.
This will ensure that there is no dissonance when the product
actually arrives at the customers home, said Prithvi
Raj Tejavath, vice-president, category management, UrbanLadder.
Also, read through customer reviews about products and the service.
Try to buy from only the bigger and better known sites, especially
if you are buying expensive products. Also, do keep in mind that
when buying online, you will not get the delivery immediately,
unlike in a physical store, where the product usually gets delivered
to your house that very day.
Tania Kishore Jaleel
(Published in MINT.)