The growth will be mostly driven by the accelerated online adoption, which is a result of COVID, states the report.
This year’s festive sales (gross merchandise volume or GMV) is expected to grow 30 per cent year-on-year (YoY) to $4.8 billion during the first week of the festive season. It will potentially clock over $9 billion GMV during the whole festive month, according to leading homegrown consulting firm RedSeer’s latest eCommerce Festive Season report. This is a 23 per cent increase from last year, wherein the players clocked in a GMV of $7.4 billion.
The growth will be mostly driven by the accelerated online adoption, which is a result of COVID. Tier-II-plus towns will continue to drive growth, as they are 55-60 per cent of the total shopper base this year, similar or higher than 57 per cent (2020 festive days).
As offline retail and mobility is recovering almost up to pre-COVID levels, this will impact the online festive sale, as customers may opt for offline shopping as well.
The categories have been evolving differently during these months. While mobile will continue to dominate, driven by new launches, electronics are expected to see the second-highest demand, driven by the wide range of selection, easy payment options, including equated monthly instalments (EMIs), 'Buy Now Pay Later', among other factors. Additionally, fashion is also expected to see a steady recovery this festive season, with greater outdoor mobility of consumers and steady rebound of fashion and office wear.
The report found that the sellers are very bullish on this year’s sales, and are looking to recover the losses suffered due to COVID. Nearly 80 per cent of them agree that festive sales will play a key role in recovery from COVID losses, while 70 per cent agreed that the bigger online players have been supportive and positive, which led up to the sales event.
The overall online GMV is expected to touch $49-52 billion, which is around 37 per cent growth from last year. It is primarily driven by strong consumer funnel expansion and the high adoption of online shopping post-COVID across categories.
“We believe that the 2021 online festive sales will continue to ride on strong tailwinds of greater consumer digital adoption, supported by an increasingly positive macro and consumption sentiment post the second COVID wave. At the same time, we see strong bullishness in sellers towards online festive sales. Eighty per cent of them believe that the festive sales will enable them to drive strong sales growth and make up for the losses during the COVID period.”
“Driven by above, we expect strong 30 per cent YoY growth in festive sale week in 2021 to reach $4.8 billion in GMV. There will be growth across categories, setting the stage for a strong year for e-commerce,” said Mrigank Gutgutia, associate partner at RedSeer.
You can read the full report below:
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