Consumers to spend $9 billion online during coming festive season

India’s e-commerce is set for another record-breaking festive season, according to new analysis by RedSeer.

This year’s festive sales (Gross GMV) is expected to grow to $4.8 billion during the first week of the festive season, a 30% increase on last year.

For the whole festive month, which runs from October 6 to November 6 (the end of the Diwali week), sales is predicted by the management consulting and research firm to hit $9 billion, a 23% increase on last year’s $7.4 billion. 

The growth will be mostly driven by the accelerated online adoption which has been witnessed as an effect of Covid-19, with more shoppers than ever set to make a purchase online. In addition, cities beyond India’s largest and mightiest will see a strong growth rate as inhabitants turn to e-commerce to still their shopping hunger.

According to RedSeer, over 55% of India’s shopper base is located in regions outside the 50 largest cities.

From a category perspective, mobile will continue to dominate driven by multiple planned new launches across the price points, including the highly anticipated iPhone 13.

Electronics and large appliances will be the second most popular category for e-commerce purchases, with fashion to rank third on the back of a steady recovery of demand for luxury and affordable fashion.

“We believe that the 2021 online festive sales will continue to ride on strong tailwinds of greater consumer e-commerce adoption supported by an increasingly positive macro and consumption sentiment post the Covid-19 second wave has passed,” said Mrigank Gutgutia, an associate partner at RedSeer and one of the report’s authors. 

“At the same time, we see strong bullishness in sellers towards online festive sales as ~80% of them believe that the festive sales period will enable them to drive strong sales growth and make up for the losses during the Covid-19 era.”