Festive Ecommerce Sales Surge to $6.5 Billion in One Week, Mobile Phones Lead Demand
India’s online marketplaces achieved record sales of $6.5 billion (approximately ₹55,000 crore) within just one week of festive sales starting September 26, marking a 26% year-on-year increase. This robust performance, primarily driven by mobile phones, electronics, and consumer durables, underscores the evolving consumer behavior toward higher-priced products with equated monthly installment (EMI) options playing a crucial role.
Record Sales and Early Trends
The week-long festive period accounted for 55% of the expected total sales during the entire festive season, with the Gross Merchandise Value (GMV) forecast to reach $12 billion this year, up from $9.7 billion in 2023, according to Datum Intelligence. Flipkart’s Big Billion Days and Amazon’s Great Indian Festival began with early access for premium subscribers on September 26, contributing to the initial surge in purchases. Meesho, a rising player in the ecommerce space, reported a 40% year-on-year jump in orders, with 45% of its demand coming from smaller towns (tier-IV cities and beyond).
Vidit Aatrey, cofounder and CEO of Meesho, highlighted that the demand was “front-loaded” this year as customers planned their purchases early to ensure timely deliveries before the festival season. Flipkart also emphasized strong demand across both metros and smaller towns, with customers from cities such as Medinipur, Hisar, and Bankura actively participating in the sale.
Consumer Shift to Premium Products
The ecommerce boom reflects a shift in consumer behavior towards high-value goods, with the average selling price (ASP) of purchases increasing. Premium smartphones like the iPhone 13, OnePlus models, and Samsung S23 Ultra were among the best-sellers. According to Amazon India’s director of consumer electronics, Ranjit Babu, the premium segment, especially items priced over ₹30,000, witnessed a 30% year-over-year growth. Notably, nearly 75% of orders for premium electronics came from smaller towns beyond tier-II cities, indicating the widening reach of ecommerce platforms.
In addition to electronics, categories like kitchenware, healthy snacks, home decor, and travel accessories saw rapid growth. Unicommerce, a software firm serving ecommerce businesses, reported a 100% rise in orders for these categories during the Navratri period. This expanding category mix demonstrates consumers exploring beyond traditional festive purchases, such as ethnic clothing and gift items.
Challenges and Supply Constraints
Despite the sales boom, supply chain issues emerged as a significant challenge. Brands have struggled to keep up with higher-than-expected demand, risking stockouts. Ahana Gautam, founder of health-snack brand Open Secret, noted that her team’s focus has shifted to managing supply. “Our biggest challenge isn’t demand but ensuring we don’t run out of stock,” Gautam said. Open Secret reported 50-200% growth across different product categories this festive season, driven by snack boxes and gifting products.
Role of EMI Payments and Discounts
EMI options and festive offers have played a key role in driving consumer purchases, particularly in higher-value categories like smartphones, TVs, laptops, and home appliances. More than 50% of buyers in these categories opted for EMI, making large purchases more affordable. Analysts noted that while the first week’s sales were brisk, consumer interest typically shifts towards lower-priced goods during the latter part of the festive season.
Satish Meena, adviser at Datum Intelligence, anticipates a second wave of strong demand between Dussehra and Diwali. “The sales momentum started fast, and we expect another uptick as customers return for lower ASP products during the next phase,” Meena explained.
Outlook
The 2024 festive season showcases the growing penetration of ecommerce into smaller towns, where consumers are increasingly purchasing premium products. With logistics and supply management becoming crucial factors, ecommerce players need to stay agile to meet consumer expectations. Brands and platforms are also leveraging early sales windows to capture demand ahead of the key festivals. As festive shopping patterns evolve, the competition to provide seamless delivery, flexible payment options, and a diverse product range will continue to shape the ecommerce landscape in the months ahead.
The image added is for representation purposes only