Shopify India's Festive Shopping Outlook Report 2021 has revealed major trends that emerged from the Consumer Insights Survey
Consumers wait for last-minute discount deals
The pull of last-minute discount deals along with short-lead/express delivery advantages offered by e-retailers have been instrumental in gaining consumer confidence. Heightened confidence in e-tailers has thus diluted traditional advance festive shopping.
Two in 3 Indian shoppers had not started shopping for the festive season at the time of taking this survey (conducted between September 15, 2021 to October 20, 2021). This is in sharp contrast to pre-pandemic traditional behaviors where festive shopping in India would kick off in full swing nearly a month in advance.
Smaller cities emerge as key e-shopping growth hubs
Multiple factors such as India's nationwide mobile penetration, brands opting to shift to a D2C model, enhanced last-mile delivery and customer-friendly return policies have been instrumental in bringing the millennial, non-metro shopper to opt for the digital medium.
Around 53% prefer to shop online
While online shopping – in the last decade – has largely been prevalent amongst consumers in tier-I Indian metropolitan cities, the pandemic has accelerated and driven this growth up the charts in tier-II cities and non-metros as well. According to the report, 53.5 percent millennial shoppers from non-metros have displayed a strong preference to shop online.
Even with increased vaccinations, consumers are wary of offline/physical shopping and in-person interactions. Convenience, value for money and personalization offered by online players has enhanced e-purchasing's appeal. However, one thing remains the same – Indian shopping still continues to be a family affair! Half the respondents of the survey indicated that they will prefer involving their families even when shopping online during the festive season.
Increased support to small online businesses
Local businesses are preferred as consumers wake up to the advantages of shopping locally. Close to 58 per cent respondents stated that they would prefer to support and shop from small online businesses during this year's festive season. This is in sharp contrast to the usual skew towards high-end brands when it comes to gifting and festive shopping.
Smaller retailers have managed to capture consumer attention and loyalty by offering a range of value for money options, along with individual attention and personalized experiences. These benefits, combined with the emotional pull that consumers feel towards extending support and encouragement to businesses that are fighting to survive, have been instrumental in driving e-sales at these small, local establishments.
Festive gifting gets utility-focused
Consumers are now leaning towards gifts with high functionality and utility value, as opposed to standard festive sweets or dry fruit tokens. Home confinements have led to consumers realizing the need to constantly upgrade or enhance their abodes. It comes as no surprise that home décor and furnishings topped this year's festive shopping lists with over 50 percent respondents displaying preference to spend on gifts under this category.
Jewellery loses sparkle; electronic gadgets is flavour of season
Big budgets parked for electronics, dimming the spotlight on jewellery Despite being considered auspicious as well as status symbols, gold and precious metal jewellery which have been traditional festive gifting favorites seem to have fallen out of favor with Indian shoppers this year. The pandemic has inspired consumers to put their money where major dependencies lie; in tech gadgets.
This festive season, electronic gadgets are all set to command maximum consumer gifting budgets with close to 42 percent respondents to Shopify's survey showcasing increased propensity towards it. High-speed internet connections and a heightened need to stay connected have increased consumer reliance on gadgets. This has translated onwards onto a large proportion of downsized festive budgets being allocated to electronic products this year.
Online shopping boom to continue
Around 76.9 percent Indian consumers show deep inclination towards online shopping this festive season because of the convenience it offers. While traditionally festive shopping has been an offline retail activity, pandemic-induced restrictions put in place to contain the virus forced most retail activity to move online. However, even with the lifting of most restrictions, high vaccinations rates and a lower COVID caseload in India, there is a continued preference for virtual retail.
Contactless spending set to dominate future of payments
Nearly 50 percent respondents stated that they preferred to process payments via UPI as opposed to any other form of transaction. Interestingly, the preference remains consistent across both, online and offline shopping experiences.
The survey reveals trends that will ultimately determine the course that the Indian retail sector will follow.
The survey by Shopify India has been released to decode changing consumer trends and sentiments in the run-up to Diwali – one of India's most important annual festivals, that also results in the largest shopping period in the country. At its core, the report is aimed at studying the impact that multiple lockdowns, shifting retail landscapes and a struggling economy have had on consumer pockets and mindsets.
(With inputs from PTI)
