Indian govt to look into Flipkart’s Big Billion Screw-up

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Indian government is looking into Flipkart’s “Big Billion Sale” campaign following several complaints from traders, reports Livemint.

Commerce and Industry minister Nirmala Sitharaman mentioned that they have received many complaints from traders that such campaigns would badly affect traditional retailers. Following this, they will take a call on whether e-commerce businesses should provide more clarity or it requires a separate policy altogether. This follows a request from Confederation of All India Traders (CAIT) earlier this week, to probe the business model and trade practices of e-commerce companies to get a sense on how these companies were offering huge discounts during the ongoing festive season. Merchants, both small and big, who have been voicing predatory pricing concerns for quite some time now.

Consumer Goods companies also complaining

A Times Of India report from earlier today suggests that several consumer goods companies like Samsung, Sony and LG have stopped fresh sales to the online retailer until they receive an undertaking that the prices will not be dropped to “unrealistic” levels. LG Electronics VP (Sales) Sanjeev Agarwal told the publication that they don’t deal with e-commerce retailers directly and also not the company’s authorized trade partners. Thats probably because Flipkart, Snapdeal and Amazon are marketplaces wherein they enable sellers offer products to consumers rather than providing products directly. Several companies like Nikon, Asus and Dell among others have previously dropped e-commerce retailers as authorized retailers and has issued advisories warning users against buying products from the site. However, these sites have maintained that products sold are genuine and customers will continue to enjoy the warranty and services as before.

That being said, TOI mentions that one of the major appliance retailers is also considering pulling warranty from some of its products which could act a big deterrent for consumers to make online purchases. It also notes that some are contemplating legal action against the company on grounds of predatory pricing, since these companies believe e-commerce retailers are damaging their brand.

Consumer Issues Are More Important

While Flipkart reported significant sales in this campaign ($100 million GMV in 10 hours), it seems to have pissed off both consumers and merchants with this sale. Consumers faced various issues like site crashes, marked-up prices, cancelled orders and out of stock deals among others, which led to the company sending an apology mail to all consumers yesterday.

 

Indian govt to look into Flipkart’s Big Billion Screw-up, Technology newsTechnical, Technology, Technology Trends
Indian govt to look into Flipkart’s Big Billion Screw-up