The festive season in India has once again demonstrated the country’s rapidly growing consumer market, with e-commerce sales surging to record levels. According to a report by RedSeer Strategy Consultants, India’s e-commerce sector generated an estimated $14 billion (approximately Rs. 1.18 lakh crore) in Gross Merchandise Value (GMV) during the Dussehra to Diwali period. This figure reflects a 12% growth compared to last year’s festive season and represents three times the usual business volume seen in other months of the fiscal year.
Growth Across Categories
This season’s sales were driven by steady consumer spending across diverse categories, including quick commerce (retail), electronics, fashion, beauty and personal care (BPC), home appliances, and groceries. The increased demand for both high-end and low-priced items has contributed significantly to the season’s success. While metro areas showed a strong preference for premium electronics and large appliances, fashion items and affordable BPC products grew rapidly, particularly in Tier 2 and Tier 3 cities.
Fashion Takes the Lead
Fashion emerged as the fastest-growing category, showing a growth rate of three times the usual monthly business in 2024. Ethnic wear, unbranded jewelry, and women’s accessories drove this trend, particularly in smaller cities. The increased availability of discounts and exclusive festive offers has empowered customers in Tier 2+ cities to explore a broader range of high-value products, fueling further growth in this category.
Rising Spending in Tier 2 and Tier 3 Cities
The report highlighted that Tier 2+ cities recorded a remarkable 13% increase in spending this season. This growth was fueled by discount availability, enhanced online shopping experiences, and expanded delivery options across more areas. With an increase in prepaid transactions, small-town shoppers enjoyed a seamless shopping experience, spending 5-6% more per shopper than last year.
RedSeer’s Associate Partner, Kushal Bhatnagar, noted, “The 2024 festive season in India has assured us of the spending potential among Tier 2+ customers. Their trust in e-commerce is growing, and we expect this trend to continue for years to come.”
Demand for Electronics and Quick Commerce Expansions
The demand for air conditioners, premium electronics, and large appliances remained high, partly due to extended summer conditions. The quick commerce sector has also expanded, now including electronics and home appliances in its offerings with extended delivery capabilities, making high-demand items readily accessible even in remote areas.
A Lasting E-commerce Boom
India’s festive season sales underscore the growing role of e-commerce in the economy. With around 250 million annual online product shoppers, the potential for deeper market penetration remains vast. As the industry continues to evolve, the trust and engagement of customers from smaller cities are expected to fuel e-commerce growth in the years to come, setting the stage for more record-breaking seasons in the future.
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