India Could Clock In Rs. 90K Crores Worth E-Commerce Sale This Festive Season; Globally Too E-Commerce Sales To Rise, Deloitte
India's flourishing online shopping population and shifting consumer preferences are set to propel e-commerce sales to new heights, with an estimated worth of Rs 90,000 crore anticipated in the upcoming festive month. Driven by approximately 140 million online shoppers, this represents an 18-20% increase from the previous year. Meanwhile, on a global scale as well, the holiday season is approaching, and retailers are gearing up for a year of significant e-commerce growth.
India is poised to experience a significant surge in e-commerce sales during the upcoming festive month, with an estimated worth of Rs 90,000 crore.
The substantial growth, up 18-20% from the previous year, is driven by a staggering 140 million online shoppers, according to reports on Friday.
Celebrating a decade of e-commerce festive season sales, the industry is on track to achieve a total gross merchandise value (GMV) of Rs 5,25,000 crore for the entire year. This prediction comes courtesy of a report by Redseer Strategy Consultants, a prominent market research firm.
The past ten years have witnessed a remarkable transformation in the Indian e-tailing landscape, with the annual GMV for the overall industry increasing nearly twentyfold during this period.
This year’s 10th festive season sale assumes even greater significance due to recent consumption slowdowns and nearly three years of external economic shocks, as highlighted in the report.
Mrigank Gutgutia, a Partner at Redseer, pointed out that in recent quarters, there has been a noteworthy increase in GMV contributions from categories beyond electronics, and this diversification bodes well for the ecosystem, reflecting consumers’ willingness to explore multiple online categories and attracting more brands to meet their diverse needs.
Following this trend, Gutgutia anticipates a growing GMV contribution from non-electronics categories such as fashion, beauty, personal care, home, and general merchandise during this festive period.
Furthermore, a persistent “premiumization” trend, leading to higher average selling prices (ASPs), coupled with increased advertising and promotional revenues, is expected to make this year’s festive season highly efficient from a margin perspective, according to the report.
In parallel, direct-to-consumer (D2C) brands are poised to grow at a rate 1.6 times faster than the broader e-tailing market.
Additionally, in terms of city-tier-wise growth, metros have outpaced tier 1 and 2 cities in recent quarters; however, the report predicts robust growth across all city tiers during this festive season.
The report added that adopting new-age technology solutions, such as generative AI, in various use cases during the sale period is expected to enhance consumer experiences and drive stronger growth momentum.
E-Commerce Sales Anticipated To Go Up Globally
On the global front, Deloitte anticipates significant growth in holiday e-commerce sales for the 2023 season.
The accounting and consulting firm forecasts a 10.3% to 12.8% increase over 2022, projecting total holiday e-commerce sales between $278 billion and $284 billion from November to January; this compares to a 7.9% growth in 2022, totalling $252 billion in holiday e-commerce spending.
During the Cyber 5 period (the five days from Thanksgiving through Cyber Monday), e-commerce sales saw a 4% year-over-year increase in 2022, reaching $35.27 billion, up from $33.90 billion in 2021. Moreover, holiday e-commerce sales in November and December 2022 experienced a 3.5% growth, totalling $211.7 billion.
Deloitte’s total holiday sales forecasts, including online and offline retail and consumer products, range from $1.54 trillion to $1.56 trillion from November to January 2023, representing growth between 3.5% and 4.6% year over year, following a 7.6% growth in 2022.
Daniel Bachman, Deloitte’s U.S. economic forecaster, explained that moderating inflation and a diminishing pool of pandemic-era savings will likely contribute to slower retail sales growth compared to the previous year.
Nevertheless, Nick Handrinos, Vice Chair of U.S. Retail, Wholesale, and Distribution and Consumer Products Leader at Deloitte, remains optimistic about strong holiday e-commerce sales; he expects retailers who remain adaptable to shifting consumer preferences and behaviours to thrive during this holiday season as consumers search for the best online deals to maximize their budgets.
The Last Bit, The e-commerce sector in India and the world is expected to draw in significant sales during the holiday season, presenting exciting opportunities for consumers and businesses.
Therefore, India’s e-commerce sector is poised for remarkable growth, fueled by a flourishing online shopping population and diversification into non-electronics categories.
Likewise, the global holiday season is expected to witness substantial e-commerce growth, with retailers adapting to shifting consumer preferences and behaviours.
