Sunday, May 26

Indian E-commerce Company Snapdeal Suspends its Affiliate Programme Amid Cash Crunch

India’s one of the leading e-commerce company, Snapdeal suspended its affiliate programme for customers amid cash crunch. The steps taken by the company seems a major setback to its operation and also the concern over cash crunch. The company finds it very hard to secure next round of funding.

However, the company is in still talk with one of its biggest investor softbank.

The company informed its affiliate partners early Friday that it will not be able to pay for orders and additional installations of its mobile application routed through them, effective immediately.

Snapdeal’s affiliate network comprises coupons, deal and cashback channels as well as blogs that bring in potential customers to website and mobile app. It pays commissions to affiliates based on the number of people who end up transacting on the marketplace.

According to industry data collated from various agencies and publishers, Jasper Infotech, Snapdeal’s parent company, was the second-highest spender on print and television advertising in the same period, next only to Amazon India.

Typically , large online retailers allocate 15-20% of overall marketing budgets for such incentive schemes, which tend to peak during the festival season around Diwali in the final quarter of the calendar year. As for Snapdeal, according to its industry partners, the company spent Rs 4-5 crore on its affiliate channels around Diwali in October out of an estimated Rs 200 crore it spent for marketing centred on the festival.