E-commerce retailers face rising costs during Indian festive season

E-commerce businesses in India are facing significant financial pressure during the festive season due to rising operational costs. While the period offers high sales volumes, retailers are experiencing squeezed profit margins driven by increased customer acquisition costs and expensive shipping.

Digital advertising costs on platforms such as Meta, TikTok, and Google Ads reportedly increase by 30% to 50% between October and December as major brands deploy large marketing budgets. This competition for visibility often makes it difficult for independent and mid-market retailers to maintain a positive return on investment.

Additionally, logistics costs are rising, with residential postage rates expected to increase during the peak period. These combined factors mean that profitability for many sellers is increasingly dependent on long-term customer lifetime value rather than individual transactions.