Festive For Ecomm- Profits In Line?

With Raksha Bandhan in August, the festive season has finally arrived in the Indian market. Undeniably, festivals bring the much-awaiting shopping season with them. From the traditional way of going to the market, visiting dozens of shops, and bargaining endlessly, the needle has now shifted towards digital purchases. Thanks to the pandemic, technological evolution has engulfed most business processes and so has the behaviour of buying things. This online purchase mechanism benefits the consumer and the producer side, as the middle chain of supply is eliminated.  

Each year, online shopping sites like Amazon, Flipkart, Myntra, Meesho, Nykaa, etc. introduce their exclusive festival offers with heavy discounts. For the past 2 years, the shopping trends witnessed a decline due to low purchase intent and the power of the consumers. However, according to a recent report, this year will witness a tremendous shift in shopping behaviour, rising a hike of 28 per cent in the online festive sales. After 2018, i.e., the pre-pandemic period, this will be a 3X growth in sales which is estimated to reach 11.8 billion dollars. Last year the sales were only 4.8 billion dollars.  

Supporting this, Abhishek Chaudhary, Co-founder, Maate, says, “Post-pandemic, customers are more focused on their health and wellness thus these sectors are expected to outperform this festive season, particularly the D2C channels. However, lucrative offers and gifting solutions are the main priority during this festive season. Additionally, since the traffic is immense on marketplaces like Firstcry and Amazon. The company should be visible on these platforms. Collaborating with well-suited brands and influencers can help reach the right audience.” 

It is believed that healthcare and the electronic sector will perform better than other segments. To this, Abhineet Sawa, Co-founder, Snapmint, shares, “As per our sales, three categories are currently witnessing the highest uptick. First is electronic devices like headphones, earphones, smartwatches. We have already seen a 7X growth in this sector as of now. Of course, mobile continues to be the biggest by value with a recorded 3X growth. This time we see a massive push from the majority of home furnishing brands. The D2C mattress brands are leading this category. The third category which is growing fast is fashion-clothing, shoes and accessories along with beauty products.” 

Fashion and homeware have always been a negotiator for this kind of sale. Amazon itself has reportedly recorded a sale of 10 lakh unique products offered by small and medium businesses including start-ups in the first 36 hours of ‘Amazon Great Indian Festival 2022’. This includes a jump of 50 per cent growth in the customers, more than 100 per cent hike in the orders and above 200 per cent increase in sales from last year. Besides this, there is a 2X growth in the customer placing bulk orders. Meanwhile, Flipkart’s pay later EMI scheme has approved credit to shoppers, which has resulted in 12X growth in the adoption on the first day of the sale. 

A good media plan and proper marketing spend can lend a hand in shooting sales. For this, appropriate utilisation of social media, print ads, store branding and exhibitions will play a key role in making the consumer familiar with the products available. This season, reaching out to tier 2, and tier 3 cities will impact the sales and will stand as a crucial purpose.  

“We are focusing on good consumer offers, digital media, and e-commerce branding. Since Covid and now even post covid, digital and e-commerce platforms have been able to sustain customer spikes and we will continue to focus on our energies,” comments Archit Goel, Executive Director & CFO, Shri Bajrang Alliance. He further adds, “Brands are at a very crucial time where the raw material prices are on the higher side and consumer and retail outlets look for deep discounts during the festive time. Brands should not compromise on the quality products and instead work with lesser margins.”