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E-tail brand building takes back seat

News, 20 October 2015

MUMBAI: India's leading e-tailing sites are claiming a successful sales week, with increased revenues and customer numbers, but industry figures have questioned the long-term value of their marketing approach.

Flipkart, for example, said it had sold products worth Rs 2,000 crore over the five days of its Big Billion Day sale, Snapdeal reported a three-and-a-half times growth in new app users and Amazon said its first sales day was twice as big as its previous biggest-day ever.

While the short-term gains seem clear, observers remarked on the advertising approach which focused on the deals available and the participants' attempts to outdo each other in the race to attract consumers.

"All these players have a short-term vision. They lack long-term vision to build a brand," said Santhosh Padhi, co-founder and CEO of creative agency Taproot India.

"I call this catalogue advertising and it can only serve the brands for a limited period," he told IndianTelevision.com. "You can't be going at it season after season."

Pratap Bose, founder and chairman of The Social Street agency, agreed. "I don't really think ad wars help these brands gain any loyal consumers for their products," he said.

"Taking digs at each other just for the sake of it, to say 'I am better than you' or 'my offer is better than yours', doesn't really cut too much ice with the end consumer," he stated.

Padhi argued that part of the problem was that ecommerce businesses are so well funded that "they have the luxury of taking a dig at each other instead of building their brand value".

That funding is also subsidising deals and won't last forever, he added. "Then the brand has to connect with its consumers with its USP. I haven't seen these e-commerce players doing a brand campaign in recent times."

In this context he highlighted the limitations of the current approach, saying: "If you interchange the logos, I bet some can't even tell which ad campaign belongs to which brand."

Data sourced from IndianTelevision.com, Economic Times; additional content by Warc staff