India has always been the kind of market where her people take festive shopping really seriously. What is an Indian festival without the mandatory new clothes, gifts and makeovers anyway? Never come across any, I suppose.
In the days of yore, every little shop down every little alley was decked in it’s festive best, stocked with everything a consumer could possibly think of and that’s how festive purchases happened. As the countdown to widely celebrated festivals like Dusshera and Diwali began, for most middle class Indian youngsters growing up in the early seventies and eighties, festive shopping meant walking hand in hand with parents who (if one was lucky), would be willing to get you that fancy toy gun in addition to a brand new pair of clothes (of one’s choice hopefully). One had to be prepared with (possibly) a paper wish list (back in the day these were mostly handwritten) well ahead of the festive season.
As we look around us today; how we shop, where we shop and how convenient/ simplified the process has become at both the retailer level and consumer level leaves us with so much to think about and analyse since this period could make or break brands.
At the retail level, retailers both large and small have been able to create nothing short of a euphoria - from immaculate window displays to offering ‘festive season discounts’ to drive sales. This also means a large number of them have stocked up on additional inventory in anticipation of the buying season.
Swedish furniture giant Ikea and clothing giant H&M have in fact capitalised on this trend of festive season buying specific to Indian consumers. While the former created a whole range of products such as lamps, lights and decorations targeting the festive Indian shopper and sent out lots of Instagram feed, the later changed their instore display completely to resonate festive shopping and goodwill.
Each year, it is estimated no matter how much the rupee falls and how much fuel prices soar, festive shopping budgets beat all previous year records. With a range of consumer financing options available now, it is no surprise festive buying now contributes to a whopping 8.2% growth in GDP at a macro level. Consumers in large cities are said to increase their discretionary spending while those in smaller towns and cities will contribute to sales in a more stable manner during festivities that span over two months. Experts suggest this comes from an ability to pool in two consecutive months salaries and the general consumer sentiment.
Although lifestyle retailers seldom offer discounts at this time of the year, it’s often their value for money price points or just the fact that consumers seek something new that drives sales to double digit figures during the festive season. The festive season in India is said to begin with Onam in Kerala, going into Dusshera and Diwali all over the country and is said to contribute 35-40% of the annual sales turnover in the lifestyle space.
In the online etailer space however, things work slightly differently and e-commerce giants like Amazon (Great Indian Festival) and rival Flipkart (Big billion sale) engage in discounting wars to attract the consumer and drive sales. Smartphones, televisions and fashion is said to contribute a whopping 70% of their business during this period.
All in all this sure is bonanza season to get the consumer’s wallet a lot lighter and brands getting a chance to meet their targets.