Indian consumers are mostly driven by mouth-watering discounts, Free Delivery option and east returns. Buyers too are looking forward for bargains to buy the best brands for the least price. Is this situation real?
Why some reputed brand or established player would like to underm
ine its brand and quality product and offer you at unheard of prices. What do they gain by doing so?
The marketplace model of web-portals have a compulsive reason to come out with fabulous offers consistently, though on the select range of products, in order to lure customers on their sites and retain their interest for them to re-visit the website and make purchases impulsively. Online buying is infectious and addictive. Mobiles with high internet speed have opened a whole new horizon for online players and traffic growth has grown manifold in last one-two years.
Amazon and Flipkart, two large online players started their venture with selling Books online which later diversified with multi-product portals on Marketplace model. Now, they no longer sell directly to their customers but with the help of thousands of third-party sellers registered with them. Some of these sellers do have privileged selling arrangement with them and they act as their instruments to influence markets with higher discounts, sale offers, cash back bargains and other means to offer incentives, with a view to retain customers with them for longer periods.
The marketplace model entail these Third party sellers to pay a fixed percentage of commission and administration charges, payment Gateway charges to receive payments online and Shipment charges for each transaction executed. These are the main source of direct earnings for a marketplace. In all, the commission payable ranges between 15% -22%, excluding the shipment costs.
While the Marketplace expects these sellers to offer optimum discounts to customers and compete with peer web-portals, the Sellers are not amused looking to hefty commissions payable and other unforeseen incidental payments, such as shipment charges on returns etc. Often you find that, of late, books sold on these marketplaces are at MRP or at a nominal 3%-7% discounts. Many of the third party sellers usually stop selling after some time for reasons such as, lower profitability, not enough orders coming their way or disputes with marketplace.
On the contrary, there is enough life at niche players who sale single or limited product on their web-portals under Inventory-led model and deliver products themselves. As such you are assured of the quality and prices. They offer you a host of other benefits such as better shopping experience, greater discounts and personalized service.
Look at the select 5 reasons why you should avoid buying books from marketplaces
1. Substandard or Unscrupulous Sellers making a killing on the marketplace websites:
The maddening rush and competition amongst the large marketplaces have led to registration of unscrupulous players too, whose intentions have always been doubtful. These merchants sell anything to everything online, such as garments, cosmetics, books, kitchen-wares and anything they could lay their hands on.
They engage in questionable practices and manipulate the system to their benefit. In some cases, customers have ordered a book but received another book and their refund requests were also not entertained.
Though, the marketplace have a system to rate these sellers on a pre-determined scale, such as 4.3, 3.2, 2.1 etc. But, unfortunately they do not blacklist them, but still allow a Seller with worst rating of say, 3.1 to sell products online. As a result, the customers get cheated and the complaints have grown exponential in recent times.
Read below some honest reviews and feedback taken from some popular e-commerce website:
- Sent a totally different book (After Empire by Dilip Hiro) and took 2 weeks to deliver. Totally not trustworthy. – Buyer A
- MRP of the book is Rs. 80. He blackened the MRP and then sold it on xxxxxxxxxxx of Rs.150. I have the necessary details /pictures if needed. – Buyer B
- Pathetic seller. I ordered Non-linear systems by khalil, I recieved some other book Scrum which looks used. Order was shipped late. – Buyer C
- xxxxxxxx seller do not understand English. First time they sent second hand/Used book, When I requested replacement, they sent different book. Avoid! – Buyer D
2. Manipulation in Prices and discounts is rampant on marketplace websites:
Tampering of MRP on products is one of the most common practices to deceive online consumers. The products would be shown with hefty discounts after their MRP have been hugely inflated. The customers often take this granted when they buy on a reputed web-portal, ignoring the fact that they are buying from a small retailer in Chandni chowk at Delhi or a non-descript shopkeeper from Crawford market in Mumbai.
I have come across one such incidence on a popular web-portal which is overwhelming. MRP of a book is manipulated to as high as Rs. 1,863 and is offered with a discount of 86% at Rs. 250. The actual price of the book is Rs. 250 and as such no discount in real sense is given. Is this an innovative pricing strategy, an act of deception or fraud with customer or a method to amuse the customer… you decide for yourself.
The book is available for Rs. 225 on Booknest.
Let me tell you that this is not an isolated incidence but there are 000’s of products whose prices are artificially inflated with a purpose to outsmart the general consumers.
3. Quality of book is often heavily compromised:
A new trend is emerging on the marketplace model. The sale of old and new books are allowed simultaneously on the web-portal. You get hefty discounts and later came to know that what you got is not a mint condition new book but a used one.
Besides, several sellers have been aggressively selling pirated books on these web-portals. You may recall buying a pirated book at 1/5th of the MRP on the street of Delhi, Mumbai, Bangalore, Kolkata. You may also wonder that most of those vendors have since vanished or perished and are no longer seen on the streets. Why? Most of these pirated books are now available on popular web-portals at hefty discounts. So, next time when you place order for a bestseller book, take a look on the seller and the copy of the book you receive.
4. You are lured with heavy discounts on Old edition books:
Marketplaces have become a preferred platform for the Publishers and Distributors to get rid of their dead stock and old edition books. The consumers are looking for a bargain and they give what others are looking forward to. Limited period offers come handy and they have to announce mouth-watering discounts. Customers lap onto these as if there is no tomorrow. Bingo… Their stocks are cleared in a weeks’ time.
5. Third-party Sellers cannot offer better pricing to consumers and still remain profitable
Marketplace portals are a great level playing field and many instances are seen when even a Publisher is not the bestseller for their own titles. Many other small Sellers have seen to be offering substantially higher discounts than the Publishers?? I trust, by now you know the reasons for such bonanzas..
It is better for us to appreciate the fact that no seller can offer great discounts on marketplace portal, after paying hefty commissions and other charges and remain profitable.
I recommend that you shall now start comparing prices of books with other specialized niche web-portals and I am sure you would be impressed with the fact that their discounts are often much higher. As they also deliver the books themselves, chances are that the packaging and delivery experience would be much more satisfying that third-party sellers on marketplaces.
Dear Online Buyers, Please think…
Who is paying for your offers or discounts? Please note, that to change your online purchasing behavior, habits or addictions, eCommerce Marketplace web-portals are just racing to capture the marketshare to get more online buyers, increase their buying trends, capture all your shopping data only to raise the next billion dollars from venture funds. Are you in game for this?