RAI and LitmusWorld: Festive Shopping Index 2021
RAI and LitmusWorld: Festive Shopping Index 2021
Festive Shopping Index shows an upward swing for 2021, increasing 14% from last year
The Festive Shopping Index 2021 co-created by the Retailers Association of India and LitmusWorld showcases a relationship between improving conditions in the outside world and the zeal with which the Indian consumer is looking forward to shopping this festive season.
When compared to 2020, the percentage of people looking forward to shopping in the festive season has gone up to 94% this year, up from 80% last year.
The fact that shopping is being done for both gifting and personal purpose also shows that the consumer is more hopeful about the end-of- year.
2020 had seen a reduction in spending on big ticket items like automobiles, jewellery and electronics. In 2021 this has changed. While apparel and fashion continue to top the list of categories that shoppers want to purchase at 63%, mobile phones have seen a whopping increase from 15% last year to 36% this year.
While home furniture has seen a dip to 24%, beauty and personal care items have seen a jump to 27%. This could be indicative of changing work scenario as the workforce begins going to office again as opposed to working from home.
The preferred categories are reflected in the consumers’ budget for this festive season. Budget up to Rs. 5000 and Rs. 1 lakh and above have seen an increase to 23% and 9% respectively.
Surprisingly, expenditure on holidays has dropped from 22% in 2020 to 17% in 2021. It could be a result of constantly changing travel norms or the restrictions on international travel which are expected to ease starting November.
While online is still a preferred channel of purchase at 73% – probably because of the customer experience of ease of use, competitive pricing, contactless delivery, choice, etc. – it has seen a drop of 2% from last year. Mall purchases have remained consistent at 66% and are the next favoured choice for consumers. Standalone shops have seen a rise from 37% to 46%. Considering the categories consumers want to shop in that have seen an increase – automobiles, apparel, jewellery – this makes sense.
The consumers’ preferred mode of payment has seen an interesting shuffle for 2021. The Festive Shopping Index 2020 showed a 7X increase in consumers preferring mobile wallets as their preferred mode of payment. This year, mobile wallets have seen a drop from 37% to 23%. Though credit and debit cards are still ruling the roost at 59% and 51% respectively, cash payments have seen a rise from 28% to 35%. A contender that is rising in the ranks of mode of payments is UPI that has gone up to 40%. With the ease that UPI provides for payments and its widespread acceptance right from online shopping to offline shopping, it is not surprising that it is living up to its name of providing a unified payments interface to its users.
With the pandemic, brands have had to really up their ante when it comes to communicating with their consumers. It’s not enough for a brand now to have a social media presence. They need to also engage with their audiences, provide grievance redressal and at the same time communicate their unique offering. Online and social media continue to be the most influential advertising media. As a result of influencer marketing too, social media has become the next arena for brands to capture their consumers’ attention.
Product features still dominate as a factor that influences buying decision of the consumer. But what has trumped discounts from its number 2 spot in 2020 is customer experience. With most online and offline channels offering discounts as a means to entice the consumer, it has stopped being a differentiating factor for the consumer to impact their purchase choice. Now, what matters more to them is the experience they have with a brand. And it is not just experience in terms of pricing but right from how they discover a brand, whether or not they have a social media presence and how well they’re able to resolve their queries or complaints.
“There has been a pent-up demand with the Indian consumer waiting to celebrate festivals in the post-pandemic world. This has triggered the revival of a very positive festive shopping sentiment. The index has also shown a significant upsurge in the share of wallet for high value purchases across categories.”
Khushaal Talreja, Head of Marketing, Litmusworld
As per the Festive Shopping Index 2021, the Indian consumer is feeling hopeful this festive season. And hopefully, this trend will continue as things begin to normalize in the outside world.
About Retailers Association of India:
Retailers Association of India (RAI) is the unified voice of Indian retailers. RAI works with all the stakeholders for creating the right environment for the growth of the modern retail industry in India. It is a strong advocate for retailing in India and works with all levels of government and stakeholders with the aim to support employment growth and career opportunities in retail, to promote and sustain retail investments in communities from coast-to-coast, and to enhance consumer choice and industry competitiveness.
Visit http://www.rai.net.in
