This is now getting all too common; Brands advising consumers that they should buy their products online at their own risk. Gionee, one of the youngest mobile brand in India, has become yet another company to caution customers against purchasing Gionee devices from various online platforms.
While they have not named any particular website, Gionee’s India head Arvind R Vohra told PTI, “One, these e-commerce sites are discounting prices below what other retail stores would sell at. After that, if the customer faces any issues post purchase, they turn them away saying its a brand issue. This is hurting our brand.”
Vohra has also clarified that Gionee does not have any direct arrangement with any e-commerce portals in India and as of now they sell online only through company’s own e-store and offline through their registered distributors. Gionee currently has over 20,000 retail touch points across India.
In response to this, spokesperson of Flipkart has stated that they completely stand behind quality and warranty associated with every product that is listed on Flipkart.
Snapdeal too assured that all products including Gionee devices listed on their site are genuine and fully eligible for warranty.
The Real Problem
It is interesting to note that Snapdeal and Flipkart are both marketplaces, and do not sell the products directly. Both of them in their statements have mentioned that third party sellers, who sell Gionee devices are authorized dealers/distributors, who also sell their devices offline. The prices offered online are decided by these sellers and not by Flipkart or Snapdeal.
So, while it completely right that ecommerce platforms offer “very low predatory prices”, it is not Flipkart or Snapdeal to be blamed, but the third party sellers on these platforms, in this case, Gionee distributors.
This is not the first time a brand has cautioned about buying online. Previously Lenovo, Toshiba, Nikon and NetGear have officially cautioned consumers that Flipkart, Snapdeal and others are not their authorized resellers and consumers may face difficulty getting warranty on their products.
Our View
In our view E-Commerce websites are not at fault here – The third party sellers who are listing these products are!
While the ecommerce platforms need to make sure that products listed on their websites are from authorized dealers only, it is latter’s responsibility to make sure warranty is offered to online customers.
Brands need to tell their distributors & dealers that they should not sell through online channels, and if they do so, they are responsible for the warranty and after sales support.
Hey Arun, Thanks for the great article, i want to understand that why are the brands not able to provide warranty services to the end user who bought their product from an online store, which is not an authorized retailer for that brand.
My friend had a similar issue with a puma footwear he bought from flipkart, and when it broke the guy in the puma store said that we don’t provide warranty services to online purchases.
As far as i understand the online stores like flipkart and snapdeal are giving the discounts out of their own pocket, to acquire customers, but from the brands point of view they are same as any other retailer right?
So why don’t the brands like Gionee and Puma not trying to tie up and make flipkart and its sellers (ws-retail) to be authorized retailer for their brand. This will be just another distribution channel for them.
Please let me know if their is some hidden cost related to providing the services like warranty that i am missing from this picture. Thanks again.
Vinit,
There are 2 aspects to this. Firstly, it might happen if the 2rd party sellers on ecommerce sites are not authorized to sell a particular brand. If that is the case, they are obviously not in a position to provide warranty for products.
Secondly, it may happen that they are authorized dealers, but are shying away from the giving warranty, as they may be selling the goods at much lower rates.
Now, in the case you mentioned about your friend, he has to see what Flipkart has mentioned in their listing of Puma shoe which he bought. Did it mention that there was no warranty? And if yes, then who was going to give the warranty.
Let me tell you, Flipkart is not responsible for giving warranty on the product, they are marketplaces where 3rd party sellers sell. So you have to catch the seller, and not the ecommerce site.
Having said that if Flipkart has got non-authorised sellers on their system, then Flipkart has to be taken to task.
Hope this clears your doubt.
Hi Arun, Thanks for replying to my earlier comment. I have few more questions:
You said that 2nd party sellers (ws-retail) on e-comm sites(flipkart) may not be authorized to see that brand (gionee). So my questions are:
how difficult is it for 2nd party seller to get authorized by the brand to sell that product?
Are these 2nd party seller are deliberately not authorizing from the brand in order to save themselves of servicing (warranty) responsibilities, in order to increase profit margin?
Do you know if the discounts that we get on e-comm sites are coming from these e-comm sites themselves or is it coming from these 2nd party sellers?
cause if it id coming from e-comm sites then these 2nd party sellers (ws-retail) don’t have a valid reason to not provide the warranty services, right?
I know you may not know some of the details, but i would greatly appreciate if you can discuss with your friends and colleagues and take the conversation forward with facts and opinions clearly defined.
In the end we both are trying to better understand the industry, i hope you don’t mind my candidness.
Regards
–Vinit
This is a suicidal move from Gionee. It is an upcoming company with good products. Online portals are most influential when it comes to buying a product even offline. I myself bought a Gionee product offline as there was notmuch price diff.Between on & offline markets, by reading the good reviews. If the company issues such stupid warnings, then they r bound to get bad reviews online and thus hamper their sales offline as well..
Good point Amit!
This is not the way it seems….selling prices are given to the e-com sites but in order to boost sales,they normally reduce the prices to sweeten the deal .In fact,some times e-com sites even sell below their procurement prices to lure customers and push the number of transactions .
You mean they offer prices below what sellers give?
And even if that is the case, Distributors obviously get the prices that they list it on… And these are authorized dealers, so that HAVE to give warranty. If online stores undercut the prices, it is their issue!