Another 72-hour Great Online Shopping Festival

Even as the likes of Flipkart clocked sales of $100 million in under 10 hours thanks to its amazing discounts on the Big Billion day sale, the Google-promoted Great Online Shopping Festival (GOSF), which kicked off on intervening night of Tuesday and Wednesday, promises to be another mega show. More than 5 million potential shoppers have already visited the site gosf.in to register themselves for the 72-hour online shopping festival that has 450 vendors this time, up from 250 last year and just 90 in 2012 when the festival was for just 24 hours.

Last year, 2 million users had visited the site and the merchants registered twice the growth on their daily average sales and this year most partners are expecting three times the sales.

Nitin Bawankule, director for e-commerce and online classifieds at Google India, told FE he saw the GOSF as a trend line for what is going to happen in the e-commerce industry the following year. For instance at last year’s GOSF, “we saw 45% of the users coming from mobile phones. At that time the e-commerce players were getting less than 20% of the transactions through mobile phones. So we told the merchants to develop their mobile platforms like apps,” he said. Most e-commerce firms now see roughly 45% of users coming on mobile platforms.

While the country’s largest e-commerce player Flipkart will not be part of GOSF, Google has managed to ensure its flagship Nexus 6 phone will be available at GOSF. Under the arrangement Google has, the Nexus 6 was to be sold in India only through Flipkart.

“The big boys might have grown indifferent but for most of the smaller players and offline players this still generates a lot of traffic and revenues. This has been working very well for them,” eTailing India founder Ashish Jhalani told FE.

However, other big e-commerce players such as Amazon.in, Snapdeal.com, Shopclues.com and Jabong.com are all geared up for the Google-promoted event. Google itself on Tuesday announced the launch of Google Chromecast in India at R2,999, to be sold on Snapdeal.com and select Airtel stores across India from Wednesday.

A continuing trend is that mobile phones still contribute 20% of e-commerce sales even if the price cuts have eased. Last year both mobile phones and laptops saw discounts of 6% on average during GOSF. According to Bawankule, discounts have ceased to be the reason for shoppers to buy online; rather, it is convenience and choice.

Also read: Early investors in Indian e-commerce book huge profits

Google also has a special section offering products at Rs 299 with free shipping and cash on delivery to attract first-time buyers, who comprised over 30% of customers last year. And that should net more customers.

“During the three-day GOSF period, we are expecting a 400% increase in traffic and 300% increase in revenues,” said Rohan Bhargava, co-founder, CashKaro.com, one of the participating merchants.

TheElectronicStore.in, part of India’s brick-and-mortar retailer The Mobile Store, believes that if you can’t beat them, join them. After earlier protesting against the discounts offered by online players, The Mobile Store is participating this year. It would be hoping to get results similar to Shopclues.com, which reported a triple-digit increase in sales and nearly 1.5 lakh new customers in the event. The company is expecting traffic to surge by 120% and 180-200% rise in sales over GOSF 2013.

According to Bawankule, last year GOSF saw women’s participation of around 40%. In a recent study conducted by Google, it found that by 2016, of the 100 million shoppers that it is expecting online, 40% will be women.

http://www.financialexpress.com/article/industry/tech/google-72-hour-sale-set-to-be-another-mega-online-shopping-fest/17449/

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Early investors in Indian e-commerce book huge profits

MUMBAI: Amid all the cash burn and eye-popping valuations, early investors in India's burgeoning e-commerce sector are beginning to book profits. TOI has learnt that Bengaluru-based venture fund Kalaari Capital may be in the process of executing a secondary sale of shares worth $100 million (Rs 610 crore) in Delhi-based Snapdeal.

The e-tailer's bigger rival, Flipkart, saw a similar secondary transaction a few months back, revealed sources. Early backers of the country's largest e-commerce player like Accel Partners part-sold their shares in a $150 million (Rs 910 crore) round. This round also saw some investors and employees in Myntra, which was bought out by Flipkart earlier this year and became its shareholders, selling their shares.

A secondary sale is when an existing investor sells shares to a new one or the promoter at the company's current valuation. The money does not come into the company's coffers. Secondary deals have been common among private equity funds in India, but are comparatively rare for venture capitalists.

Vani Kola, MD at Kalaari Capital -- which is now a shareholder in Flipkart as an early Myntra investor -- did not respond to a query from TOI regarding the secondary transaction at Snapdeal. Accel Partners also did not offer any comments till the time of going to press about selling shares in Flipkart.

One of the first investors in Flipkart back in 2009, Accel had put in a million dollars in the company, which is now valued at over $10 billion. Kalaari, which first invested in the e-tailer as IndoUS Ventures, has in all put $25 million (Rs 150 crore) in Snapdeal over the past five years and holds around 14% stake in the online commerce player.

"Exits of early investors via secondary transactions is a very healthy trend and fills the last mile of the investing ecosystem. Exits are the lifeblood of venture capital and have been an issue in India. So this is an encouraging development and shows maturation of the process,' said Avnish Bajaj, MD at early-stage VC fund Matrix Partners India.

Sources privy to the matter told TOI that Kalaari, an early-stage $160 million fund, was likely to shed a small single digit stake, giving it a windfall return nearly the size of its current fund. Sources said the secondary deal was being done at a higher valuation to the SoftBank round which valued Snapdeal at around $2 billion. The Japanese telecom and internet giant, which pumped $627 million into the company, owns about 32% in Snapdeal.

Also read: Amazon Drone to fly soon for delivery

The exact size of these secondary deals at Snapdeal, Flipkart and Myntra and the identity of the buyers could not be ascertained immediately.

Silicon Valley fund Bessemer Venture Partners, another early investor in Snapdeal, part liquidated its shareholding in the company, booking gains on its investment during the SoftBank round itself.

The country's top online commerce players including Flipkart, Snapdeal and Amazon have been bleeding on account of their frenetic growth and discounting to lure customers on to their platforms. TOI carried a report last week stating that almost a billion dollars in investor money was being guzzled up by the larger e-tailers collectively on account of advertising, discounting and increasing their employee strength. Flipkart and Snapdeal alone have raised about $3 billion this year from investors.

Also read: Another 72-hour Great Online Shopping Festival

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Job Applications Fell Down in US

WASHINGTON — The number of people seeking U.S. unemployment benefits slipped below 300,000 last week, after having spiked above that level in the prior week for the first time in nearly three months.

According to report, Weekly applications fell 17,000 to a seasonally adjusted 297,000, the Labor Department said Thursday. The four-week average, a less volatile measure, rose 4,750 to 299,000.

Applications are a proxy for layoffs. As fewer people seek unemployment benefits, it suggests that employers are holding onto more workers and potentially looking to bolster their hiring.

Applications have been under 300,000 for 11 of the past 12 weeks, an unusually low level that suggests employers are anticipating stronger economic growth. The four week average for jobless claims has plummeted 9 percent over the past 12 months.

Such sharp declines in applications are unlikely to continue, analysts said. But at sub-300,000 levels, they point to better job gains in the Labor Department’s employment report, said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

“The trend probably has now flattened off, but at an extraordinarily low level, consistent with very strong payroll numbers,” Shepherdson said.

The decline in application for unemployment benefits has been matched by a surge in hiring.

Employers have added an average of 228,500 jobs a month this year, putting 2014 on pace to be strongest year for hiring since 1999. That’s up from an average of 194,000 last year. The unemployment rate has fallen to a six-year low of 5.8 percent, down from 7.2 percent just a year ago.

The November jobs report being released Friday is expected to show gains of 225,000 last month, according to the data firm FactSet.

The payroll processer ADP said Wednesday that private companies added 208,000 jobs in November.

Even with gains this year and five years removed from the end of the recession, nearly 9 million people are out of work. Before the recession began in 2007, there were 7.6 million unemployed Americans. Less than a quarter of the people counted as jobless by the Labor Department are collecting unemployment benefits.

The recent job gains have not lifted wages by much, stifling the potential for the economy to grow more quickly. Average hourly pay rose 3 cents in October to $24.57. That’s just 2 percent above the average wage 12 months earlier and barely ahead of a 1.7 percent inflation rate.

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