Best online deals to have short life as brands battle surging input costs

Kolkata: Deep discounts on ecommerce platforms are set to be short-lived this festive season. Electronics, smartphone and fast-moving consumer goods (FMCG) companies plan to offer peak discounts for only the first three to four days starting Thursday, before tapering them off as rising input costs squeeze margins. This marks a shift from previous years, when steep discounts continued for seven to 10 days until the first major festive sale around Navratri, before easing during subsequent sale events leading up to Dhanteras.

The more than a month-long online festive season begins on Friday, with early access for members from Thursday, led by Amazon, Flipkart, Reliance's JioMart and quick-commerce platforms. "Deep discounts will be limited to a few stocks and a few days. There will be a mix of aggressive price offers for a limited period with limited stock, apart from 17-18% discounts in the first three-four days. This will then come down to 10-12% over the usual selling price," said Super Plastronics CEO Avneet Singh Marwah.

The company sells televisions under Kodak, Thomson and Blaupunkt brands.

"Raw material inflation is immense and not everything has been passed on to consumers. So, the scope to offer heavy discounts is extremely limited this year," Marwah said.

Televisions, smartphones and laptops are bearing the brunt of surging memory chip prices, which have roughly tripled since January as artificial intelligence (AI) data centres drive demand beyond supply. Smartphone prices have increased 35-40% on average since January, while television prices are up 10-15%, according to industry executives.

The weakening rupee, higher logistics costs and inflation in commodities such as copper, plastic, aluminium, wheat, edible oil and packaging materials have added to cost pressures across consumer goods, from refrigerators, biscuits to soaps.

In smartphones, discounts will be lower than last year, while their duration will depend on demand in the first few days, executives said.

"If there is good pent-up demand in the first three-four days, discounts will definitely come down. Otherwise, brands may offer discounts for an extended period as they don't want to hold high inventory beyond Diwali," said Tarun Pathak, research director at Counterpoint Research. "Discounts will not just be lower than last year but even compared with the preceding two-three quarters as prices have further gone up."

Wonderchef managing director Ravi Saxena said online platforms have stopped burning cash on discounts, leaving brands to bear most of the cost. "The first three-four days will have peak discounts of up to 20%, then they will moderate and peak again only during Dhanteras," he said.