Coronavirus has not hampered India’s festive spirit. It has just shifted priorities. Despite the Covid-19 triggered economic slump, and the rampant layoffs and salary cuts, the festive season, kicking off with Navratri on October 17, is expected to be a blockbuster time for India’s e-commerce industry.
The total gross merchandise value of Indian e-commerce is set to touch $7 billion (Rs 51,000 crore), nearly double the $3.8 billion a year ago.
Physical stores, however, will face a blip as Indians opt to shop online in the wake of the Covid-19 pandemic. In 2020, offline retail sales in India are estimated to decline by 1.9% in 2020 over 2019, as against a pre-Covid estimate of 9.4% growth, according to data analytics firm GlobalData.
Meanwhile, the Indian e-commerce industry is now estimated to grow 32.8% in 2020, higher than the pre-Covid projection of 29.7%.
The number of online shoppers in India during the festive months is set to double to around 50 million from 28 million in 2019, according to consultancy firm RedSeer.
“Store closures amid Covid-19 lockdowns lowered customer appetite to spend on discretionary products,” said Vijay Bhupathiraju, retail analyst at GlobalData. “(The) fear of contracting the virus during shopping trips is shifting the customer spending to online channels, and other factors such as reduced working hours and frequent lockdowns will cause a sharp decline in growth forecasts of the offline channel.”
Yet, e-commerce players will need to undertake several tweaks to meet the changing trends.
From ensuring safety and hygiene to finding the right products that will sell in these uncertain times and reaching shoppers in remote regions, there is a lot that companies like Flipkart and Amazon need to figure out this festive season.
Flipkart’s Big Billion Days 2020 sale starts at noon on October 15 for Plus members, and October 16 for everyone else. Amazon’s Prime members will get access to its annual Great Indian Festival deals at midnight on October 16, and it will open for all on October 17.
E-commerce amid coronavirus
After a complete shutdown in March and April – when India was under a government-mandated lockdown and only essential items were allowed to be sold – demand for online shopping bounced back with a vengeance. “As compared to the pre-March period, we have Prime members who are shopping at a higher frequency and buying across categories,” an Amazon India spokesperson said. The new launches and deep discounts during the festive season are likely to further boost demand.
However, the poor economy and volatile job environment are likely to make shoppers watch their budgets. “Consumer sentiments towards shopping non-essential products and goods have been low since the beginning of the lockdown,” said Rajeev Kumar K, senior vice-president of market development, South Asia, Mastercard.
While shoppers tighten their purse strings, e-commerce firms have to crack the new habits India has formed at home to ensure higher sales.
Take fashion for instance. Physical distancing amid Covid-19 has led to fewer social interactions, which lowered customers’ need to spend on formal and party wear, said Bhupathiraju. At the same time, it increased their need to buy more comfort apparel – some office-friendly, some purely for lounging.
Similarly, those upgrading their study-from-home or work-from-home setups may be hunting for deals on desks and laptops. Moreover, kitchenware, kitchen appliances – even the elusive dishwasher – and home furnishing likely feature on Indians’ shopping lists this year.
Besides having the right catalogue, e-tailers will need to ease coronavirus-related fears to win.
Safety and hygiene will be paramount as shoppers place online orders this year, after all, the fear of the virus is one of the main reasons why more shoppers are expected to opt for online as against brick-and-mortar stores.
“Many people have shown concerns with crowded markets and irresponsible behaviour of some people who choose not to wear masks and follow social distancing protocols,” an October survey by community social media engagement platform LocalCircles noted. “They believe getting things delivered at home is the safest and the most convenient way of shopping at these times.”
To safeguard customers and employees, e-commerce players are encouraging digital payments, offering contact-less deliveries, and amping up safety at their warehouses.
Myntra, for instance, is imposing strict social distancing norms, regular temperature checks, frequent sanitisation of facilities and delivery bags, ensuring the use of PPEs at all times, frequent hand sanitisation and more.
Wooing new India
While the number of shoppers is ballooning, the profile of a typical online shopper is evolving, experts say.
The first 100 million online buyers in India have been largely homogenous – affluent, English-speaking, internet-savvy buyers from metros with ample disposable income. However, the next wave is far more diverse in terms of consumption patterns, geographical locations, languages and levels of disposable incomes.
These are fairly new challenges to solve.
To cast their nets far and wide, e-commerce companies are going above and beyond to service the less internet-savvy.
Breaking language barriers
With several users hailing from non-metro cities, vernacular interfaces have become the need of the hour. Nearly 30% of e-commerce platform Snapdeal’s users prefer to browse in a regional language, the company’s recent survey revealed. In the run-up to Diwali, Snapdeal is available in eight languages, Amazon in six, and Flipkart in five.
Making transacting easier
Behemoths Flipkart and Amazon have forged partnerships with banks for broader coverage of debit card EMIs, alliances with digital non-banking financial companies for no-cost EMI solutions, and boosting buy now, pay later offerings.
This is not going to help everyone, though. “There is a large part of India that is still not online, a large part that still is unbanked, a large part that still does not use digital currency,” said Yugal Joshi, vice-president of consultancy Everest Group.
Improving last-mile logistics
“Whenever a customer orders a product from a rural or remote area, the e-commerce companies find it difficult to maintain the same efficiency and delivery speed as in urban areas due to the lack of proper infrastructure and difficulty in finding addresses,” said GlobalData’s Bhupathiraju. “This has discouraged customers from rural areas to prefer offline channels over online.”
But innovation during the pandemic has supposedly fixed much of that.
For instance, Flipkart has onboarded over 50,000 kiranas which will help manage a higher number of shipments during the festive season.
Meanwhile, over 100,000 Amazon-enabled local shops, kiranas and neighbourhood stores from across India are geared up to serve customers during this period. More than 40% of these sellers come from outside the top 10 cities.
This article first appeared on Quartz.
Respond to this article with a post
Share your perspective on this article with a post on ScrollStack, and send it to your followers.