Ecommerce has witnessed a robust revival in sales during the festive season, primarily fueled by a surge in premium purchases across categories such as mobiles, large appliances, jewellery and beauty products, according to industry experts. The trend of premiumisation was notably prominent this year, driven in part by increased accessibility to credit and EMI options, facilitating a shift towards higher-end products. For instance, the availability of EMI options led some Samsung users to switch to iPhones, impacting sales in the Rs 12,000-15,000 range while propelling iPhone sales to a record high.
This shift towards premiumisation extended beyond metro cities, reaching Tier 2 and beyond regions, particularly in fashion and beauty. This change in consumer behaviour may have adversely affected brands targeting the mass market segment during the festive season. Amazon reported significant demand spikes in categories like jewellery, premium smartwatches and luxury beauty products, with customers from 99.7 per cent of the country’s pin codes participating in the month-long celebrations.
Despite the growth in premium purchases, overall industry sales are unlikely to have surpassed a 20 per cent increase during the season, according to industry experts. Delhivery CEO Sahil Barua noted that gross merchandise value (GMV) for e-commerce grew 15 per cent, aligning with earlier estimates projecting a 20 per cent growth to reach Rs 90,000 crore. While there was a heightened focus on e-commerce, offline players still contributed significantly, with over 80 per cent of retail sales in India coming from brick-and-mortar stores.
In the competitive landscape, the Flipkart Group, comprising Flipkart, Myntra and Shopsy, led the festive season sales, capturing around 63 per cent of GMV and maintaining leadership in volume terms. Meesho retained its second position, increasing its market share to 25 per cent of total orders, up from 21 per cent in the previous year’s festive sales.
Despite the positive trajectory, industry experts noted that growth is now driven more by factors such as higher average order values and increased ordering frequency, rather than the acquisition of new customers as e-commerce penetration has already reached a significant level. Overall, the festive season marked a significant rebound for e-commerce, emphasizing the evolving dynamics of consumer preferences and purchasing patterns.
