eCommerce biggies to hike ad rates post the whooping festive sale response

Eyeing at the ongoing pre- Diwali sales, Indian eCommerce majors such as Snapdeal and Flipkart have extensively increased their advertising rates for products on their platform.

New Delhi-based Snapdeal has recently doubled the cost per click (CPC) for all its categories of products during its ‘Unbox Diwali Sale’ started from Oct 2 to Oct 6. Arch rivals Flipkart has also increased its product listings ad (PLA) rates by up to 50 per cent for many of its high value segments including lifestyle, home furnishing, mobiles and electronics during its ‘big Billion Day’ sale.

Commenting on the same, Sanjay Ramakrishnan, Senior Director, Product Marketing, Flipkart said thatduring the Big Billion Day Sale there will be a huge increase in traffic, time spent by the consumer on the platform, and engagement. There will at least be 2x returns on investment only due to the increased traffic even if we don't take into account the other metrics.

Even on television and other media the ad rates go up during certain times and advertisers are prepared for it, he added.

During the festive season, the rates have been revised in accordance with the increase in traffic and conversions. The company expects returns on spends to be better for the sellers even with the festive season hike in the advertising rate, said a spokesperson from Snapdeal.

Such move from the online marketplaces will surely impact small sellers as they manage their own advertising campaigns on eCommerce portals compared to big sellers whose advertising campaigns are managed by media agencies.

Sellers on these eCommerce platforms are allowed to use the portal as an advertising platform for a better discoverability and lure more customers. Home-grown marketplaces like Flipkart and Snapdeal have a manual system for advertising on their platform while US-based Amazon has an automatic system where sellers can set their budget and let the system bring in the most clicks within that budget.