Given the developments of the past few months, it is fair to say that COVID-19 has presented a challenging new situation. With festivals around the corner, Indian retailers are in a very difficult position. The lockdown has opened new business horizons for e-commerce players and, in a way, changed the festive shopping trends in India. The fear of going to crowded places has massively impacted small retail businesses in the country; e-commerce companies, not to the same extent.
Start of the Festive Shopping Season
Since September, with the beginning of Ganesh Chatutrthi, a major festival in Maharashtra and Western part of the country, consumers have been engaging in festive shopping which will continue until post-Diwali in November. Traditionally offline retail businesses come up with multiple schemes and discounts to lure consumers, but this year the shopping trends have changed due to the pandemic and the lockdown.
Apart from a few consumers who still prefer shopping offline at malls and markets, it is mostly online shopping which is hogging the limelight. Adapting to the ‘new normal’ to survive and thrive is an ordeal that the retail sector is confronted with. Adding to the woes are uncertainties like financial stability and job security that have slowed the spending patterns.
Some of the specific changes in festive shopping trends in India are listed below.
Contactless payment and digital transaction trends
Contactless payment is the need of the hour. With few reports suggesting that cash could be a potential transmitter of the COVID-19 virus, festive shoppers are choosing cashless transactions by using digital payment or contactless payment. Interestingly, this is a new trend in a cash predominant economy of India. According to a report, the contactless payment market is expected to grow to USD 18 billion by 2025.
Self-service models picking up
With social-distancing being the ‘new normal’, self-serving models are fast catching up in the market. Shopping trends such as buy-online-ship-to-store (BOSS) and buy-online-pickup-in-store (BOPIS) are gaining strong foot-holds among consumers and retail businesses alike.
Buy now Pay Later (BNPL)
E-commerce players in India are using new financial services to attract and retain customers by offering them a micro-credit option where a consumer can buy now and pay later without having to pay any interest. This service is free of cost if the dues are paid within the agreed period. In this time of economic uncertainty, there has been a payment paradigm shift in e-commerce where buy now pay later (BNPL) has emerged as one of the preferred payment options.
Digital promotions and Attractive offers
Biggies of Indian business like Reliance, Tata, Future group have all opted for e-commerce business. Taking the lead, various Indian and international shopping brands have opted for online sales and are at loggerheads with other competitive brands giving the best of their discounts and offers to consumers. In a way, online shoppers are spoilt for choice. As brands are increasingly focusing on major digital outreach to tap their customers, experimenting with digital platforms is on the rise this festive shopping season. These platforms will not only be used for brand and product promotions, but will also serve as a point of purchase.
Indians love exchanging gifts during festivals but, amidst the travel restrictions and social distancing, people are choosing convenient gifting options. In the pre-corona era, gifting was one of the primary sales drivers during the festive season as consumers would splurge in bulk buying. Adapting to the new shopping trends, digital gift vouchers are proving to be the go-to option. Online retailers are providing festive opportunities via discounted sales and promotions for customers to splurge in a seamless shopping experience.
This year has seen many departures from the norm, both for businesses as well as consumers. The lockdown and its aftermath have set new shopping trends and it would be interesting to see how this pattern unfolds further.