Amazon heavily dependent on Diwali sale for revenue

The company won’t go down the road of ad-supported Amazon Prime Video soon.


MUMBAI: Not only do Indians eagerly await Diwali but so does Amazon it seems. The largest online retailer across the world has published a mixed result for the third quarter. While its revenue fell short of Wall Street expectation, it posted a record profit. On the other hand, despite the growth in domestic business, the international business showed a significant slowdown. Interestingly, a late Diwali in India has been cited as the reason which shows how crucial the Indian market has become for it.

“There's also material change in the Diwali calendar in India. About half of our Diwali sales last year were in Q3. This year they'll be fully in Q4. So those are a couple factors that hit the international growth area in particular,” Amazon chief financial officer Brian T Olsavsky said in an earnings call.

In India, Amazon is already fighting the domestic player Flipkart which is now backed by Walmart. The first leg of Diwali sale from both the player was around same time. Despite Flipkart’s popularity in India, three fold number of people signed up on Amazon to shop in the first two days compared to last year.

“We've seen great response from customers. We've had 60 per cent growth in new customers during the period. Orders are coming in from 99 per cent of the pin codes in the country. So, great first wave of the, what we call the Amazon's Great Indian Festival, which lead into Diwali,” Olsavsky added.

Advertising has been one of the major areas where the company reaped high profit. The revenue from the unit representing its display, sponsored product and other advertising revenue jumped 123 per cent, more than double the growth rate a year earlier.  While it is locked in a battle with Google, Facebook for digital ad pie, the company has made it clear that it won’t go down the road of ad-supported Amazon Prime Video soon.

Amazon Prime membership, the card at hand to turn more consumers into shoppers, has continued to grow in US, as well as other countries. The company claims to be satisfied with the renewal data and annual sign up data since the price increase earlier this year.

“Since then, program remains very strong, both in membership and engagement, and a lot of our video content, music and shipping definitely as well as other Prime Benefits. We just continue to see that ramp up, not only in the US, but in other countries. So we do continue to make the Prime offer better as well,” Amazon CFO said.

Although the slowdown in international business led to fall in shares, it continued to reduce losses, which came down to $385 million in Q3 from $494 million in Q2. However, on the back of Diwali sale Amazon expects a huge boost to international segment reaffirming India’s importance in its business.

Latest Reads

Pocket Aces launches India's first Instagram original series 'Firsts'

The first significant moments of any relationship are always cherished. With this simple thought in mind, Pocket Aces is launching its new unique web series “Firsts” in partnership with Cadbury Dairy Milk Silk facilitated by Wavemaker. Silk will be seamlessly integrated in the series as an enabler...

iWorld Over The Top Services
Firework India to onboard various content creators like Faye D'Souza

After getting into a partnership with Faye D’Souza, Firework India plans to rope more creators to generate quality and genuine content on the platform. Recently, former Mirror Now executive editor Faye D’Souza launched a new channel called Facts First with Faye, wherein she will be speaking on...

iWorld Over The Top Services
What factors drive content commissioning decision of OTT platforms?

From the later part of 2017, streaming players have delivered many “blockbuster originals”. Social media chatters, peer groups, office rooms see numerous discussions on premium content available on ZEE5, Netflix, Amazon Prime Video, Hotstar, Voot , MX Player and so on.

iWorld Over The Top Services

From Left to right - Bennet, Boutonnat and Riester: France wants to build closer ties with Bollywood

France woos Indian content creators; lays out interesting incentives

MUMBAI: The French government is laying out the red carpet for Indian film, digital originals and TV series makers.  French minister of culture Franck Riester flew into Mumbai and had a series of whistlestop meetings with members of the creative community at Mumbai’s Soho House. His pitch: come to...

iWorld Over The Top Services
Erosion of credibility of mainstream media gave birth to ‘Facts First with Faye’

She has been a vociferous anchor on primetime news. She has been a fierce role model for women in the media industry. And now she’s embarking on a new journey as an independent content creator. Faye D'Souza, former Mirror Now executive editor, spilt the beans about her new channel ‘Facts First with...

iWorld Over The Top Services
ZEE5 Super Family will unify and gamify India: Taranjeet Singh

ZEE5 is approaching the stiff competition in the crowded over-the-top (OTT) space with innovative measures. Taking the trend of gamification one step ahead, it is prepping to launch a new property - ZEE5 Super Family (ZSF). While fantasy games have been targeting men usually, ZSF is targeting women...

iWorld Over The Top Services
India captures second spot globally in smartphone shipments in 2019

MUMBAI: Move over US. Now it’s the turn of India, which has just beaten it for the first time on an annual basis to take the second spot as far as smartphon shipments are concerned. In 2019, more than 158 million phones were shipped in the country, registering a seven per cent year on year growth....

iWorld Telecom
Amazon Prime Video creates a Guinness World Record with an iconic LIVE performance of The Forgotten Army – Azaadi Ke Liye, music album

MUMBAI: Marking the launch of much-awaited Amazon Original Series The Forgotten Army – Azaadi Ke Liye, Prime Video successfully created a Guinness World Record for The Largest Indian Cinematic Music Band with an iconic live performance of the show’s album. The evening saw 1000 musicians from across...

iWorld Over The Top Services
SonyLIV strengthens original content team by roping in Hotstar’s Saugata Mukherjee

MUMBAI: As all streaming platforms in India are becoming more bullish on original content slate, Sony Pictures Networks India (SPN) is also rebuilding its digital team. Few months after handling SonyLIV’s responsibility to Danish Khan, the over-the-top (OTT) platform is roping in Saugata Mukherjee...

iWorld Over The Top Services

Sign up for our Newsletter

subscribe for latest stories