As the festive season of 2024 approaches, e-commerce in India is projected to achieve a 20% year-on-year growth, potentially generating between Rs 1 trillion and Rs 1.2 trillion in gross merchandise value (GMV), according to the latest Festive 2024 Report by Redseer. This growth marks a notable increase compared to last year’s figures, driven by a resurgence in consumer spending and strategic business adaptations to previous economic challenges.
The festive season, which typically spans from Onam to Bhaidooj, is shaping up to be a critical period for businesses aiming to capitalise on the anticipated consumption boom. The report highlights several key factors influencing consumer behaviour and driving e-commerce activity during this time.
Key growth drivers-
Pent-Up Demand: The demand for categories such as mobiles and electronics is expected to surge, as these sectors typically experience heightened interest during festive periods. Fashion, while slightly subdued this year, is also anticipated to benefit from increased consumer engagement.
Premiumisation: Many brands are set to promote premium stock-keeping units (SKUs) at discounted prices, enticing consumers looking to indulge in higher-quality products.
New Product Launches: Brands will introduce fresh selections and limited-time offerings in trendy categories like fashion, appealing to consumer curiosity and the festive spirit.
Steady BAU Growth: Sectors such as Beauty and Personal Care (BPC) and quick commerce (q-commerce) are expected to continue their business-as-usual growth trends, providing additional uplift during the festive season.
Category and platform insights
The report indicates that the festive season will favour the ‘big three’ e-commerce categories: mobiles, electronics, and fashion. These categories, which have faced challenges throughout the year, are projected to gain momentum, with festive growth figures likely to exceed 25% in certain segments. Conversely, sectors such as BPC, home goods, and grocery categories driven by q-commerce are expected to thrive, with q-commerce alone potentially witnessing around 100% YoY growth during the festive period.
Emerging categories like home and kitchen appliances (including microwaves, coffee machines, and air fryers) are set to see aggressive promotions on q-commerce platforms, aiming to enhance average order values and profitability. Traditional festive products, such as gold or silver coins and various gifting collections in packaged food and beauty, are also likely to attract consumer interest.
Strategic collaborations and offers
To attract consumers during the festive period, brands and unbranded sellers are expected to collaborate closely, offering a variety of enticing deals. Consumers can look forward to bundled offerings, exchange deals, free gifts, and flash discounts on leading e-commerce platforms. Additionally, platforms are likely to support brands through initiatives like commission waivers, advertising credits, and data analytics to optimise promotional efforts. Some platforms may also introduce direct delivery fee waivers and financing options to enhance customer accessibility.
As the festive season unfolds, the e-commerce landscape in India is poised for remarkable growth. Businesses that strategically harness these insights and adapt to evolving consumer preferences will be well-positioned to thrive in an increasingly competitive market.