Indore (Madhya Pradesh): In the world of online shopping, flash sales are a major draw for consumers seeking big discounts on popular products. However, these limited time sales events are not without challenges. Major e-commerce platforms like Amazon, Flipkart and Snapdeal have faced website crashes, server errors and stockouts, especially during high-demand flash sales.

Yet, despite these service failures, many customers continue to participate in subsequent sales events. What makes them come back? A new study, “Sold Out, Crashed or Delayed? Why Consumers Still Love Flash Sales,” revealed that consumers who were highly motivated by discounts (deal-prone consumers) were more forgiving of service failures, such as website crashes, stockouts or delays during online flash sales.

Despite these issues, they continued to participate in future sales because they prioritized the excitement of securing limited-time deals over the potential frustrations caused by service disruptions. The research, led by IIM Indore’s Prof K R Jayasimha along with DPM alumni Himanshu Shekhar Srivastava and Anjali Sharma, provided valuable insights into consumer behaviour and offers crucial advice for businesses seeking to retain customers during service failures.

The study specifically examined the psychology of consumers who participate in online flash sales on platforms like Amazon, Flipkart and Paytm Mall—where deals are available for a limited time and usually end when all the items are sold out or at a preset time. Through a scenario-based experiment involving 196 respondents aged 18 to 35 years, the study revealed that “deal-prone” consumers were more forgiving of service failures than other shoppers.

These were the customers who were primarily motivated by discounts and tended to overlook service disruptions like server issues, delays in shipping or problems with payment processing. For these consumers, the promise of a limited-time offer outweighed the potential hassles that may arise during the transaction process.

According to the researchers, these “deal-seeking” shoppers were driven by the excitement of securing a bargain, which enhanced their tolerance for any service issues that might occur. These customers, therefore, were key target for online retailers as they demonstrated resilience in the face of problems—returning to future sales events despite past frustrations.

The study also highlighted the importance of ongoing support after a service failure. E-commerce businesses that were able to manage customer dissatisfaction effectively could retain clients even after a problematic transaction. In fact, managers who targeted deal-seeking consumers in future sales, even after a prior service failure, could reduce churn and boost retention, it said. Key strategies included showing the scarcity of deals, offering live discount coupons or providing “pre-sale registration” to create competition among consumers for the best deals.

Moreover, features like “Know When on Deal,” where consumers could sign up to be notified when their desired products went on sale, could increase engagement and prompt further participation, even when past sales experiences were less than perfect. Such strategies fostered a sense of urgency and exclusivity, pushing consumers to act quickly before the deals were gone, the study said.

“For online retailers, the message is clear: understanding the dynamics of deal-prone consumers and managing service failures effectively is critical. This study offers valuable guidance for e-commerce platforms, suggesting that focusing on the excitement and competition surrounding flash sales can help businesses maintain customer loyalty—even in the face of technological or logistical mishaps,” Jayasimha said.

“As online flash sales continue to grow in popularity, businesses that can adapt to consumer expectations and manage the challenges of service failure will be better positioned to thrive in this competitive marketplace,” he added.