09 - 10 - 2026

Amazon opens its festive war chest

India’s annual shopping carnival has barely lifted its curtain, and Amazon is already counting the footsteps outside the shop. Demand has surged 35-40 per cent before the full launch of its Great Indian Festival, prompting the e-commerce giant to pour an additional Rs 2,800 crore into infrastructure in anticipation of what it hopes will be its biggest festive sale yet.

The Indian shopper, it seems, needs little persuasion to part with money, provided the discount is attractive, the delivery is quick and the bank offers to pay part of the bill.

Rising demand

Amazon India Vice President Saurabh Srivastava said demand had jumped even before the sale opened at midnight on Wednesday. Once the festival began in earnest, he expected the numbers to climb further.

“We are seeing a 35 to 40 per cent spike in demand already,” he told reporters here, adding that the company was confident of making this year’s edition its biggest by a considerable margin.

Such confidence is not entirely misplaced. In India, festivals have traditionally meant new clothes, sweets, gold and the occasional argument over who should pay for dinner. Increasingly, they also mean smartphones, washing machines, beauty products and household appliances ordered with a few taps on a screen.

Amazon is preparing for this digital stampede by expanding the machinery behind the shopping basket. It has added 20 fulfilment centres, 150 delivery stations and six sort centres, increasing its fulfilment-centre capacity by 50 per cent.

The additional investment of Rs 2,800 crore is intended to ensure that a surge in orders does not leave customers staring at a screen displaying the dreaded words: delivery delayed.

There was a time when a shopper went to the market, examined the merchandise, bargained with the shopkeeper and carried the purchase home. The modern shopper prefers to inspect 27 alternatives on a telephone, summon a discount and then complain if the parcel arrives a day late. E-commerce companies have had to learn that convenience is not merely a selling point; it is an obligation.

Amazon has also expanded its rapid-delivery service, Amazon Now, to 120 cities. In eligible locations, customers can receive selected products and deals in about 10 minutes. The idea is to make waiting for a delivery almost as unfashionable as waiting in a bank queue.

But the company is not relying on speed alone. Bank discounts, cashback, coupons, no-cost equated monthly instalments, Amazon Pay Later and exchange offers are all being deployed to persuade customers that this is the right moment to buy.

Srivastava described the combined offers as the best value of the year for customers. Amazon, however, declined to disclose a specific sales-growth or gross merchandise value target for the festival.

The company says its priorities are customer acquisition, growth in Prime membership and customer satisfaction rather than a particular sales or profit figure. It is a sensible public position for a company preparing to handle millions of transactions, though the eventual sales numbers will inevitably be scrutinised.

Behind the discounts lies a more significant change in the geography of Indian consumption. The country’s shopping ambitions are no longer confined to its metropolitan centres.

Amazon has around 22 lakh sellers on its marketplace, approximately three lakh more than last year. The expanding seller base brings a wider selection of products and intensifies competition over prices and service.

More revealing is the source of new customers. Nearly 70 per cent of Amazon’s new Prime members are coming from Tier-2 and Tier-3 cities, Srivastava said.

“The centre of gravity on growth has moved to Tier-2 and Tier-3,” he observed.

This is perhaps the most consequential part of Amazon’s festive story. India’s smaller cities are no longer merely waiting for metropolitan tastes to trickle down. Their consumers are increasingly buying premium smartphones, smart appliances, beauty products, apparel and home goods, with the appetite for such products growing at a pace comparable to that in larger cities, according to the company.

Beyond Metros’ Reach

For e-commerce, this means the next big customer may be found not in a luxury apartment in Bengaluru or Mumbai, but in a household hundreds of kilometres away, where online shopping has become a convenient route to products that may not be readily available in the neighbourhood market.

Reaching these customers, however, requires more than an attractive advertisement. Warehouses must hold the right stock, delivery stations must be positioned sensibly and transport networks must cope with a sudden multiplication of parcels. The Rs 2,800-crore investment is as much about logistics as it is about selling.

Artificial intelligence is also being baked in for the festive campaign. Amazon’s AI-powered shopping assistant, Rufus, helps customers discover products, compare alternatives and understand features and prices. On the seller side, AI tools assist with decisions on inventory levels, stock placement and promotional offers.

In other words, while the customer debates whether to buy the more expensive phone, the machine is busy calculating how many units should be sitting in a warehouse and where they ought to be sent.

Amazon believes a successful festive season can do more than produce a temporary spike in sales. It can bring new customers into the marketplace, encourage them to join Prime and turn occasional buyers into regular ones.

Srivastava said each edition of the Great Indian Festival established a new high watermark that became the starting point for the following year’s growth.

That is the ambition, at least. Amazon has declined to put a precise figure on the sales it expects, but its infrastructure expansion and early demand indicators suggest it is preparing for a substantial surge.

The customer wants a bargain, the seller wants a sale, and the delivery executive wants to finish the route without being sent back for a missing parcel. Somewhere between these competing interests lies Amazon’s Rs 2,800-crore bet on India’s festive appetite.

By B D Narayankar

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