This year’s (2021) festive sales (Gross GMV) is expected to grow 30% y-o-y to $4.8 billion during the first week of the festive season and potentially clock $9+ bn GMV during the whole festive month, according to homegrown consulting firm RedSeer’s latest eCommerce Festive Season Report. This is a 23% increase from last year, wherein the players clocked a GMV of $7.4 billion.
The growth will be driven mainly by the accelerated online adoption, which has been witnessed as an effect of Covid. Secondly, Tier 2+ will continue to drive growth as they are 55-60% of the total shopper base this year, similar to or higher than 57% in 2020 festive days.
On the other hand, as offline retail and mobility are recovering almost up to Pre-Covid levels, this will impact the online festive sale as customers may opt for offline shopping as well.
Further, categories have been evolving differently during these months, which will impact the festive sale as well. While mobile will continue to dominate, driven by new launches, electronics are expected to see the second-highest demand driven by the wide range of selection, easy payment options, including EMIs and Buy Now Pay Later, among other factors. The fashion industry is also expected to see a steady recovery this festive season with greater outdoor mobility of consumers and a steady rebound of Fashion and office wear.
The report finds that the sellers are very bullish on this year’s sales and are looking to recover the losses suffered due to Covid. Nearly 80% of the sellers agree that festive sales will play a key role in recovering from Covid losses, while 70% agreed that the more prominent online players have been supportive and positive, which led to the sales event.
The overall online GMV is expected to touch $49-52 billion, which is around 37% growth from last year, primarily driven by strong consumer funnel expansion and the high adoption of online shopping post-Covid across the categories.
“We believe that the 2021 online festive sales will continue to ride on strong tailwinds of greater consumer digital adoption supported by an increasingly positive macro and consumption sentiment post the Covid second wave has passed. At the same time, we see strong bullishness in sellers towards festive online sales as ~80% of them believe that the festive sales will enable them to drive strong sales growth and make up for the losses during the Covid period. Driven by the above, we expect strong 30% y-o-y growth in festive sale week in 2021 to reach $4.8 Bn in Gross GMV with growth across categories, and setting the stage for a strong year for eCommerce in 2021,” said Mrigank Gutgutia, associate partner at RedSeer.