Consumers have continued to show a preference for premium products versus entry-level goods, reveal sales trends during the first shopping weekend of this year — the Republic Day weekend. This comes as an urban slowdown continues to weigh on middle-class wallets even as the premium and affluent class remain immune to it.
Conversations with durable retailers and companies point to a sales growth of around 10-15% during the R-Day weekend this year versus last year, led by premium categories such as larger capacity refrigerators, air conditioners and TVs, front-load and top-load washing machines and smartphones that are Rs 30,000 and above. Fashion, lifestyle and apparels, on the other hand, are likely to see around 11-12% year-on-year (y-o-y) sales growth this R-Day, led by winter and wedding wear, executives say.
“The premiumisation trend has continued into the new year, with January being better than December. It is a K-shaped recovery, as the uptick for premium durables is higher than mass products during the R-Day weekend,” NS Satish, president, Haier Appliances India, said.
“While the durables industry will see around 10-15% y-on-y sales growth this R-Day, from a brand perspective, we are seeing a 30-35% sales growth y-o-y in premium versus mass,” Satish says.
He says the company had put more feet on the ground, focused on driving visibility of its premium products within stores and pushed offers to help consumers transition to feature-rich products easily.
Both durable brands and retailers have pushed offers and discounts for R-Day, but the emphasis has clearly remained on easy financing schemes rather than deep discounting.
Nilesh Gupta, director, Vijay Sales, a consumer durables retailer, says, “Discounts are around 40-50% on electronic and home appliance products, but the focus is on driving affordability and access with easy instalments, long-tenure and zero financing schemes. This way, we make it attractive for consumers to upgrade easily in categories such as mobile phones, TVs and home appliances.”
The trend is similar in apparels, with discounts being lower by at least 7-8% during R-Day and January in general versus last year. Sales growth, meanwhile, is likely to be in double-digits, Manish Kapoor, MD & CEO, Pepe Jeans, said, as price realisations may be better as discounting reduces.
“The wedding and winter wear segments are looking up this year, so the desperation to clear inventory is not that high and discounting therefore wasn’t that sharp this R-Day. The trend has been visible since the middle of December as the wedding season kicked off. Sales growth improved by around 9-10% in December 2024 versus the previous year. While sales growth in January 2025, which includes R-Day, will likely be around 11-12% year-on-year,” Kapoor says.
In an earnings’ call last week, Shoppers Stop MD & CEO Kavindra Mishra said that demand trends had improved in the first two weeks of January thanks to the wedding season and that sales growth was better versus December and November.
“Premium categories have contributed 64% to total revenue (versus 55% earlier) and we intend to maintain this trajectory in January, February and March (2025),” Mishra said.
Initiatives like ‘India Weds with Shoppers Stop’, ‘Winter Magic’ and ShowStoppers’, which were initiated in the December quarter of FY25, have continued into January and the R-Day weekend, the retailer said. Shoppers Stop is eyeing a sales growth of at least 10-11% in premium wear in the March quarter, experts added.
