More than 85% Amazon sale customers from non-metros: Saurabh Srivastava

The month-long Amazon Great Indian Festival (AGIF) 2024 witnessed 1.4 billion customer visits, the highest ever for the e-commerce firm, said Saurabh Srivastava, vice-president, categories, Amazon India. In a video interview with Peerzada Abrar, Srivastava revealed that Amazon delivered over 30 million products the same day or next day (to Prime members), and customers had access to over 25,000 new product launches from top brands. Edited excerpts:

 

What kind of growth have you observed during this year's AGIF and how does it compare to the last few years?

 

It has been our biggest ever festival season sale. Whatever we achieved last year in 30-35 days, we achieved those customer numbers in 20 days. What our customers find appealing is our large selection, great value and fast delivery. We had almost 1.4 billion customer visits, which is record breaking for us. Almost 85 per cent of the demand came from outside metros —Tier-II, II and below. Customers had access to more than 25,000 new launches from top brands across categories. To make sure that customers get their product fast, we expanded our fulfilment centre network and operation capability and hired 110,000 associates. On the seller side, we saw a 12 per cent reduction in selling fees across multiple product categories ahead of the festival season. This enabled sellers to expand their product portfolio on the platform besides providing a boost to growth. Sellers witnessed more than 70 per cent increase in those surpassing Rs 1 crore in sales compared to last year. We also saw a strong adoption of what we call value levers, which include equated monthly instalments (EMIs) and no cost- EMIs and exchange offer that we have. 

 

Flipkart said it recorded an overall 7.2 billion visits in terms of customer engagement this festival season between September 1 and October 28. It also witnessed a record 282 million unique visitors during the period. What kind of trends have you observed across categories?

 

The 1.4 billion customer visits is record breaking for us. These are only recognised visitors. There may be a lot of customers who might come (to the platform), but don't register with us and go away. We don’t count those. We are not talking about hits. We are talking about customers who have registered and shopped on our platform. We have seen a very clear trend across product categories and customer cohorts is premiumisation. Here, there has been a spike in the premium level of products ranging from smartphones, laptops to Lego toys and kitchen appliances. In the fashion and beauty category, there has been a 400 per cent spike in the premium category. AGIF 2024 also received the highest single-day of Prime sign ups in the first 48 hours. About 96 per cent of Prime customers shopped with us this festival season. We delivered about 30 million products to our Prime customers the same day or the next day. Over 4,500 sellers saw a 10-times spike, over 7,000 sellers saw a 5-times increase, and over 13,000 witnessed a 2-times spike in sales compared to last year’s event. Though premium smartphones stood out in terms of sales, categories such as electronics, including laptops, earphones and home and kitchen products, luxury, fashion and beauty and toys also drove growth. There was also 4.5-times year-on-year (Y-o-Y) growth in two-wheeler sales across 500 cities, with surging demand for electric (115 models) and new petrol models. The event started with demand for items such as iPhones, laptops and tablets. It progressed towards demand for products related to ethnic wear, clothes, watches, jewellery, gold and home and kitchen appliances.

 

What are the trends that you are seeing from Tier-II and III cities and Bharat?

 

More than 85 per cent of customers were from non-metro cities and from Tier-II and III cities. More than 50 per cent of TV purchases came from these locations. Tier-II and beyond contributed to more than 70 per cent of the premium smartphone sales. Over 60 per cent of new Amazon customers from Tier-II cities and below shopped for fashion and beauty items. These trends make us very happy, because they show that Amazon is gaining trust across the country. Small and medium businesses, including women entrepreneurs, weavers, and artisans sold over 1,000 units every minute during the event. EMIs fuelled big-ticket purchases. Here one in four electronics sales, from mobiles to large appliances, leveraged EMI options.

 

Also, four out of five of these were no cost EMIs, registering 45 per cent Y-o-Y growth. Overall EMI adoption surged 25 per cent compared to 2023. We also provide exchange offers for products. These help the customer get access to the premium products that they aspire for. Also about 70 per cent of Prime members who shopped during the festival season were from Tier-II III cities (versus 60 per cent last year).

 

How do you view the performance of quick-commerce players this festival season? Does Amazon have any plans to come up with a service which may have some elements of quick commerce in it?

 

We don't comment on competition and also don’t talk about our future plans. Our focus is on how broad based our customer base and our services are. We look at serving across the length and breadth of the country and at speed. We are hugely successful in that and this energises us. For example, Prime members across over 9,000 pin codes in India received their deliveries within 48 hours of placing their orders. We will always continue to improve our speed of delivery. It has been much faster than last year and this has been across millions of products. We take a broad based approach towards our selection, value offering and speed. That has worked for us and we will continue to focus on that. We believe our strategy is working.

 

What has been the role of technology and talent at Amazon during this year’s AGIF? 

 

I'm very excited about how we are using generative AI (GenAI). We have been working on it for many years. This time we put some of that in front of our customers. We unveiled Rufus, a new generative AI-powered conversational shopping assistant. The customer response has been amazing. It enables natural language interactions within the Amazon app, making it easy to ask product-related questions, get recommendations, or compare products.

 

We also unveiled AI-generated review highlights, which make use of generative AI to provide concise summaries of customer reviews. If there are about 10,000-20,000 reviews, a customer can’t go through them manually. We also use AI and machine learning (ML) models to recommend the size of products related to different fashion brands personalised to each customer.