<ul><li>Indians are spending more on ‘prosperity-driven categories’ like OTTs, gadgets, says a <keyword id="3359665" type="General" weightage="80" keywordseo="redseer" source="Orion">Redseer</keyword> report. </li><li>Spending towards personal care, education, food and clothing has a moderate growth in the last five years but has good long-term growth ahead. </li><li>The areas that grew slowly and will continue to see slow growth are house expenses and the consumption of tea. </li></ul>In the last five years, Indians have been gulping soft drinks, buying insurance products, spending on recreation with OTT subscriptions, audio and video gadgets; and are keeping pets at an accelerated pace. The wanderlust bug has also truly bitten too as spending on travel has accelerated and this is expected to skyrocket further in the next five years, says a report by Redseer. All these spending in ‘prosperity-driven categories’ indicate growing affluence, says <keyword id="4436374" type="General" weightage="50" keywordseo="mrigank-gutgutia" source="Orion">Mrigank Gutgutia</keyword>, partner at <keyword id="3631351" type="General" weightage="50" keywordseo="redseer-consulting" source="Orion">Redseer Consulting</keyword>. “Indians are getting richer and their capacity and ability to buy such products is going up, thanks to rising disposable income. When the sales of these products start to happen at a size and scale, it indicates maturity of consumption patterns,” <keyword id="14381863" type="General" weightage="50" keywordseo="gutgutia" source="Orion">Gutgutia</keyword> tells <keyword id="1857762" type="General" weightage="50" keywordseo="business-insider-india" source="Orion">Business Insider India</keyword>. Basic spend towards personal care, education, food and clothing has a moderate growth in the last five years but has good long-term growth ahead. The ‘others’ category is the most interesting which has been slow and will continue to see slow growth — are house expenses and the consumption of tea, Redseer adds. Going premium &amp; digital There are consumption themes arising across products and services, Redseer says — like premiumization in personal vehicles, electrification of two-wheelers and travellers preferring ‘organized’ players. Added to that, digital entertainment, fashion going into tier-2 cities —- are all indications of how patterns of consumption are changing, says Redseer. In the short term however, macroeconomic conditions have been bleak that has affected the personal consumption of Indians which has dipped to $2.2 trillion in FY23. However it’s on its way up and expected to touch over $2.4 trillion in FY24. Product-oriented consumer internet sectors have faced recent growth headwinds, but they are likely to revive steadily, the report says. “Indicators across emerging sectors, such as credit card spends, air travel, and sales of vehicles, show signs of recovery in Q1 FY24,” says Redseer. Most services except travel can see normalized growth expectations ahead. SEE ALSO <a href="https://www.businessinsider.in/stock-market/news/wonderla-holidays-a-multibagger-gaining-from-the-holiday-mood/articleshow/101572445.cms">More than child’s play: This amusement park company turns multibagger</a> <a href="https://www.businessinsider.in/business/news/mid-tier-it-companies-expected-to-outperform-the-big-guns/articleshow/101548594.cms">Mid-tier IT companies expected to outperform the big guns</a>

Juice over tea – India's spending pattern is taking a premium drift

<ul><li>Retailers can be served better by multi-category platforms as they seek competitive rates, says <keyword id="3359665" type="General" weightage="80" keywordseo="redseer" source="Orion">Redseer</keyword> report. </li><li>Multi-category platforms like <keyword id="6357316" type="General" weightage="100" keywordseo="udaan" source="Orion">Udaan</keyword> have gained market share to reach 55-60% of the retailer-led eB2B market. </li><li>India’s eB2B market is projected to grow from $5-6 billion in 2022 to $90-$100 billion by 2030. </li></ul>India’s vast retail system comprises a variety of sizes – from the local general stores or kiranas to the organised big players. This whole system is supported by a large, haphazard and unorganised system of wholesalers largely. However, in order to grow to its true potential, the retail system will have to bank on organised electronic business-to-business (eB2B) players going forward, according to a report by advisory firm Redseer. The rationale for the argument is that India is a potential $950 billion retail market and thus will do better if served by multi-category platforms, which in turn will smoothen processes for the front end player. Multi-category platforms offer products across groceries - both staples and <keyword id="34523" type="General" weightage="50" keywordseo="fmcg" source="Orion">FMCG</keyword>, electronics and accessories, general merchandise, fashion, and others. Current picture As per the Redseer report, there are few such big eB2B platforms which have a <keyword id="106831" type="General" weightage="20" keywordseo="pan-india" source="Orion">pan-India</keyword> play currently. Most are eB2B platforms that operate in fewer categories or verticals and access regional and national levels. “Over the last few months, many of these vertical platforms have been struggling, and across categories have shown limited growth/ been flat or declined due to challenging unit economics and prevailing macro-economic conditions, while multi-category platforms like Udaan have gained market share to reach 55-60% of the retailer-led eB2B market,” said <keyword id="4436374" type="General" weightage="50" keywordseo="mrigank-gutgutia" source="Orion">Mrigank Gutgutia</keyword>, partner at Redseer. Udaan is a B2B trade platform, designed specifically for small and medium businesses. Why multicategory platforms? Retailers are dogged by many issues that come with an unorganised market, and there is a case for new-age eB2B platforms that can solve these issues. “The fragmented market puts retailers at a disadvantage procuring from traditional channels owing to price opacity, slow/no deliveries, stockouts, and inconsistent product quality, among other challenges,” says a Redseer report. Retailers who decide to take their business online from the traditional channels, seek competitive rates across categories, and might have to resort to multiple B2B suppliers. “For instance, a retailer might procure rice from a particular eB2B platform and choose a different one for detergent. Unless the same platform can offer both at competitive rates, the retailer would buy from different platforms based on their margins,” Redseer said. Enabling this competitiveness requires cross-leveraging capabilities and costs, and multi-category first-party (1P) platforms with inventory-based models have a distinct advantage, the consulting firm says. While grocery and staples provide them with volumes, discretionary items might be able to drive margins — both which are needed to be in this large market. Growth path and way forward According to Redseer, India’s eB2B market is projected to grow at a compound annual growth rate or CAGR of 40-45% – i.e. from $5-6 billion in 2022 to $90-$100 billion by 2030. “Growth in this market will be led by deepening penetration among retailers across categories and geographies, and a higher wallet share for eB2B platforms. Retailers will get habituated and reap the benefits offered by these platforms, such as cheaper procurement, faster deliveries, higher fill rates, and consistency in product quality,” said Mrigank.

India’s retail system needs more Udaan-like models for the unorganised market

<ul><li>D2C brands’ gross merchandise value is expected to grow to $35 billion by 2027.</li><li>They are expected to grow at a CAGR of 40%, faster than retail and eCommerce markets.</li><li>D2C shipments were at half a billion in 2022, and could grow to 3 billion by 2027. </li></ul>India’s direct-to-consumer brands are growing fast, spreading their wings far and wide. As per estimates by Redseer, their gross merchandise value (GMV) will swell to $35 billion by 2027. A large number of brands like <keyword id="4548811" type="General" weightage="20" keywordseo="mamaearth" source="Orion">MamaEarth</keyword>, <keyword id="360663" type="General" weightage="20" keywordseo="kama-ayurveda" source="Orion">Kama Ayurveda</keyword>, <keyword id="211425" type="General" weightage="20" keywordseo="hopscotch" source="Orion">Hopscotch</keyword> and <keyword id="12227756" type="General" weightage="20" keywordseo="the-sleep-company" source="Orion">The Sleep Company</keyword> have been gaining ground for the last few years. Yet, the D2C market itself is at a nascent stage, believes Redseer. “Brand creation is getting easier and incentivized,” it added. But they’re chugging along fast and are expected to exhibit a compounded annual growth rate (CAGR) of 40% for the next four years. Their growth rate will outdo retail market growth as well as the broader eCommerce market. Their growth rate is thrice as fast as compared to the retail growth, and 1.6 times that of the eCommerce market. Their growth will also give a push to third party logistics (3PL) players as D2C brands do not follow the traditional distribution channel. In 2022, the number of D2C shipments stood at half a billion. And, they might grow to 3 billion by 2027. “3PL solutions tie-in well with the D2C segment as demand varies across cities/regions and the required logistics investment is on the higher side. Brands need reliable logistics partners with a wider reach across India to ensure consistency of experience,” said Mrigank Gutgutia, partner at Redseer. Most D2C products have varied requirements like return management, cold storage supply chain, hassle-free claims and more. “The mid-large beauty and personal care brands are also competing on reach and quick delivery. Hence aspects like ability to handle fragile items matter more prominently for them,” said Redseer. Home and general merchandise brands also require high degree of shipment protection to prevent damages. Food brands on the other hand work on lower margins and seek affordable shipping. Brands need quick delivery in cities and dense networks to enable quick delivery. “The keys to success for 3PLs vary widely depending on the category of D2C players, however, tech-enabled reliability, shipment protection and affordable pricing are what the D2C brands in India seek the most, with pan-India reach being a fairly common expectation,” said Gutgutia. <keyword id="2841678" type="General" weightage="80" keywordseo="xpressbees" source="Orion">XpressBees</keyword> and Shadowfax are used by brands that need low-cost shipping. Delhivery and Blue Dart are used by brands that need quick and reliable delivery which is tech-enabled. Ecomm Express is known for wider reach with a larger focus on tier 2 cities and beyond.

D2C brands growing at a much faster clip than ecomm, shift to boost third party logistics

<ul><li>The first four days of the <keyword id="1549946" type="General" weightage="20" keywordseo="ecommerce-sales" source="Orion">ecommerce sales</keyword> season clocked ₹29,000 crore, says Redseer.</li><li>This year, Indian shoppers hurried to book products ahead even before the sales season started.</li><li>The Pre-book or Price lock feature allows users to lock-in the prices of high value products, before the sale. </li></ul>It’s weeks before Dussehra and Diwali, but Indians are not holding their horses when it comes to shopping online. The first four days of the ecommerce sales season clocked in sales to the tune of ₹29,000 crore, says Redseer. This is around 16% higher than the gross merchandise value (GMV) in the same period last year. The report adds that the fear-of-missing-out or FOMO mood has set into Indian shoppers who have hurried to book products even before the sales season started. Many consumers took advantage of the ‘Pre-book/Price lock’ features, the report said. The industry-first feature allows users to lock-in the prices of high-value products, even before the festive sale starts. “Due to this feature, along with attractive deals on high average selling price (ASP) items and easy financing options like No-Cost EMIs, consumers locked in their choices in advance to avoid FOMO on these deals later during the actual festive sale period,” said Redseer. Accordingly, Day 0 or the Early Access Day, saw a 10 times increase in sales over the business as usual (BAU) for e-commerce websites running sales. The first day saw an over 7 times increase in sales over BAU. "Premiumization as a theme is clearly being seen in this festive season as consumer discretionary spending in high ticket categories has done well. Further, the steady growth in overall sales and high ASP categories reinforces the belief in the strength of the Indian consumption story,” said Mrigank Gutgutia, partner, Redseer. Categories like fashion, beauty &amp; personal care, home, amongst others may gain traction in the second half of the Week 1 festive sale, the consulting firm says. Apart from quantity, the quality of this year’s sales are also improving. E-commerce companies have increased focus on faster deliveries and improved customer experience. That has led to lower cancellations which is generally rife during the festive surge in sales. Moreover, the pre-book feature has allowed them to gauge demand better prior to the sale period — be ready for surge and fulfill orders in a quick and orderly manner.

Shopping FOMO? Indians spend ₹29K cr online ahead of festive season

<ul><li>Most online sellers have seen muted growth in 2023 and expect the festive season to bring a change.</li><li>Smaller sellers are willing to contribute a higher share of their revenue towards ads.</li><li>As many as 62% sellers say that e-commerce platforms are supporting their festive planning.</li><li>Online sellers expect at least a 15% jump in <keyword id="1460935" type="General" weightage="20" keywordseo="festive-sales" source="Orion">festive sales</keyword> as compared to last year. </li></ul>With opportunity comes responsibility, Winston Churchill had once famously said and India’s online sellers are getting ready with a similar mindset at the onset of the festive season. Sales have been muted so far in 2023 but in a bid to do better than the previous year and pick up their stagnant fortunes, the small online retailers are opening up their wallets to spend on marketing. As per a report by Redseer, the marketing budgets of all sellers is likely to expand 50% from business-as-usual (BAU) times. What is more, this might go up to 75% more when it comes to the smaller players. In other words, the smaller sellers are willing to contribute a higher share of their revenue towards ads when compared to larger sellers. This is an offshoot of the muted season that online sellers saw. Only 40% of online sellers surveyed saw over 10% revenue growth this year. “The festive period is expected to enable sellers, especially the smaller ones, to come out of the challenging sales environment seen through this and sellers are optimistic of strong sales growth. Accordingly, they are willing to significantly ramp up their advertising spending on the ecommerce platforms during this festive period,” says Mrigank Gutgutia, partner at Redseer Strategy Consultants. Online sellers are a tad more bullish about sales this festive season. They expect at least a 15% jump in festive sales as compared to last year. The median sales growth for the sellers is pegged at 26%. The festive season starts in September and goes all the way to November with Diwali. By Redseer’s projections, e-tailing sales will rake in approximately ₹90,000 crore in gross merchandise value (GMV). That’s 18-20% more than what was sold last year. “Sellers across the categories including in the lower average selling price (ASP) ones like fashion are bullish about this growth trajectory, which should provide a respite in this otherwise challenging macro-environment,” the consultancy firm said. Apart from bullish expectations, online sellers are also now more confident about e-Commerce platforms that their tailored solutions. As many as 62% said that the platforms have been supportive in their festive planning. “Through our surveys, sellers have highlighted the strong support received from platforms in terms of data analytics, trends predictions, consumer visibility, among others,” Redseer said.

Small online sellers set to push their ad budgets higher this festive season

<ul><li>Around 140 million shoppers are expected to be transacting online at least once this festive month, says Redseer.</li><li>Sales are expected to come from high-margin businesses like beauty &amp; personal care, home &amp; general merchandise, along with fashion.</li><li>D2C brands are expected to grow 1.6 times faster than the broader market. </li></ul>Indian <keyword id="811198" type="General" weightage="20" keywordseo="e-tailing" source="Orion">e-tailing</keyword> or e-retailing has a lot to celebrate this season — if Redseer <keyword id="9903214" type="General" weightage="80" keywordseo="strategy-consultants" source="Orion">Strategy Consultants</keyword> are to be believed, 2023’s festive season sales will rake in approximately ₹90,000 crore in gross merchandise value (GMV). That’s 18-20% more than what was sold last year. “This growth will be driven by about 140 million shoppers who are expected to be transacting online at least once during this festive month,” said the report. India’s festive season kicks off next with Vinayaka Chaturthi celebrations that last nine days, followed by Navratris and extends all the way to November with Diwali. Persistent premiumisation The sales this year are also expected to come from high-margin businesses like beauty &amp; personal care (BPC), home &amp; general merchandise and fashion etc. There will be persistent premiumisation leading to rising average selling prices. Increasing ads and promotion revenues will possibly make this year’s festive season the most efficient from a margin perspective, the report added. “Over the last several quarters, we are seeing enhanced GMV contributions from categories beyond electronics. While electronics sell a lot in the festive period, looking at the bigger picture and comparing the festive sale periods over the last several years, there is a clear trend of category diversification,” said Mrigank Gutgutia, partner at Redseer Strategy Consultants. The willingness of consumers to purchase ‘multiple categories’ online also bodes well for the sector. D2C to zoom ahead The expected boom in sales is also expected to bring in moolah for D2C brands in addition to traditional retailers. The consultancy firm expects these brands to grow 1.6 times faster than the broader eTailing market. Metros have been growing faster at 10% for the last few quarters; and Tier 1 and Tier 2+ towns are growing at around 8%. But this festive season, the growth might be robust for both, it expects. On an overall basis, the consumption trends are also improving, claims the consultancy firm. The annual growth rate of Private Final Consumption Expenditure (PFCE) has bounced back to 9% – which was around what it was before the pandemic. Over the last few years, there has been flux in the market due to Covid-19 pandemic and other shocks like the Russia-Ukraine conflict. But these trends are also reversing. “Interest rates are maxing out, countries aiming to resolve the Russia Ukraine conflict, and the Indian economic growth numbers are coming in strong. So, there are meaningful tailwinds to support a relatively strong festive period this year,” the report added. Moreso, the total annual GMV for 2023 is expected to be around ₹5,25,000 crore, as the number of transacting users have jumped 15 times over the number in 2014.

Festive boost: Online sales may see a 20% jump as Ganapati kicks off celebrations

<ul><li>India’s monthly users or ‘regular shopper’ base is now at 65 million.</li><li>Fashion is now the single-largest category as it overtook mobiles; beauty and personal care is one of the fastest-growing categories.</li><li>Advertisement revenue of e-tailing also experienced a steep growth to generate over $1.2 billion in FY23. </li></ul>India’s e-tailing or electronic retailing, grew 22% in FY23 to $60 billion in gross merchandise value (GMV). The growth rate is slower compared to the pandemic years — which saw growth of 36% each in FY22 and FY21, says a report by <keyword id="3359665" type="General" weightage="20" keywordseo="redseer" source="Orion">Redseer</keyword> Strategy Consultants. “Despite losing momentum, e-tailing today is 2.5x of pre-Covid levels and is performing much better than overall retail consumption, which has been tepid in the recent quarters due to inflation concerns,” said Mrigank Gutgutia, partner at Redseer. This robust growth is driven by highly relevant and affordable supply on e-tailing platforms and standardised experience. Growth in direct-to-consumer brands and accelerated digital adoption of traditional brands aided the growth, according to Redseer’s India E-tailing Update. Growth in regular e-shoppers At the same time, shoppers are showing signs of maturity – as indicated by shopping online becoming a habit. There are as many as 65 million monthly users or regular shoppers’ — this is the highest it’s ever been. As many as 31% of annual shoppers are now monthly shoppers as well. This number is up from 23% in FY21 – indicating that more people shop online more frequently across categories. “Over the last three years new users who are willing to try <keyword id="436047" type="General" weightage="20" keywordseo="ecommerce" source="Orion">eCommerce</keyword> throughout the country have increased and non-metro users account for a large share of the total user base in FY23. The growth in new users has also turned steady,” Redseer says. It’s fashion over phones The depth of e-tailing market has grown as compared to pre-Covid levels, across categories. Mobile phones had been the most dominant category before the pandemic, in FY19, but now fashion has become the single largest category, accounting for 27% sales. Mobile sales are a close second at 25%. “Strategic partnerships of e-commerce platforms with global and Indian brands along with a change in shopper mix and an increasing share of women shoppers has resulted in an explosion of fashion sales,” Gutgutia adds. Though beauty and personal care accounts for only 4% of the total GMV, it’s growing at an exponential rate of 52%. Grocery segment and home categories have seen 64% and 39% compound annual growth rate (CAGR), respectively, between FY19-23. Platforms gain traction The sellers also have been gaining. With 1.2x better take rates, the revenue from product sales across India e-tailing has grown 3x – from $2 billion in FY19 to $6 billion in FY23. As the number of frequent e-shoppers grows, the platforms are able to diversify their revenue too. Advertisement revenue of e-tailing also experienced a steep growth, with ad monetisation generating more than $1.2 billion in FY23. The report also said that Flipkart group, one of India’s pioneering e-commerce sites, has been the most resilient in terms of market share in the last few years, with a market share of 48% in FY23. Redseer says that Flipkart withstood competition from incumbents owing to a large selection, varied affordability constructs and strong understanding of needs of the vast e-tailing shopper base in India including those from T2+ cities.

India’s internet retail growth is tapering but shopper base is maturing: Redseer

The Indian smartphone users are spending 30 minutes a day on consuming <keyword id="1605152" type="General" weightage="20" keywordseo="memes" source="Orion">memes</keyword> and 80 per cent have increased meme consumption in the last year, a new report showed on Monday. While most users enjoy memes as a good way to release stress, 50 per cent expect their meme consumption to increase, according to the report by strategy consulting firm <keyword id="3359665" type="General" weightage="80" keywordseo="redseer" source="Orion">Redseer</keyword>. "The shareability of memes makes them popular among groups with the same interest or even globally because most people find them relatable. Thus, it comes as no surprise that in just the last year, close to 80 per cent have increased meme consumption," said Mrigank Gutgutia, <keyword id="6399933" type="General" weightage="80" keywordseo="partner" source="Orion">Partner</keyword> at Redseer. Memes are now at the peak of the entertainment sector. To keep up with this rising demand, meme creation platforms are crowding the market, indicating that monumental growth is on the cards for this industry. "Ninety per cent of consumers are open to creating memes themselves, indicating large latent demand for meme creation apps," said Gutgutia. <keyword id="6354632" type="General" weightage="20" keywordseo="social-media" source="Orion">Social media</keyword> is the primary source for access to memes, followed by word of mouth from friends and family. "Social media has allowed everyone to try their hand at content creation, thus, this has paved the way for the rise of meme creation apps and platforms," the report mentioned. People want to consume or create memes for brand building and as a creative outlet. "An important aspect that makes memes attain such huge popularity in a short period of time is that any individual can connect to them -- and this works great for brand building and marketing," the report added. SEE ALSO : <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/sensex-slips-517-points-goes-below-the-60000-mark/articleshow/93701486.cms">Sensex slips 517 points, goes below the 60,000-mark</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/the-new-instant-noodle-fad-on-instagram-is-korean-noodles/articleshow/93659979.cms">Beyond the squid game: Indian taste seekers are warming up to K-noodles</a>

Indians spend half an hour every day on memes and that's gone up 80% in the last year

<ul><li> As the COVID-19 pandemic forced people to stay home and shop online for everything, consumers moved away from just <keyword id="112217" type="PERSON" weightage="20" keywordseo="Discounts">discounts</keyword> and looked at products that bring value.</li><li>While the overall transaction value in e-commerce fell during the months of peak lockdown in India, April to June, it picked up soon after.</li><li>This shift from discounts to quality products has also resulted in consumers shopping from Direct to Consumer brands.</li></ul>India – a country where shoppers let discounts choose their consumption patterns and offline shopping being dependent on one's bargaining skills – has a new story to tell with e-commerce. Last year, as the global pandemic forced people to stay home and shop online for everything, consumers started moving away from pinning buying decisions on discounts to looking at products that bring value, indicates a report by Bengaluru-based research firm <keyword id="3359665" type="PERSON" weightage="20" keywordseo="RedSeer">RedSeer</keyword>. While the overall transaction value in e-commerce fell during the months of peak lockdown in India, April to June, it picked up soon after as people still afraid to venture out of their homes resorted to buying most of their essentials online. <div type="image" title="consumer trend" msid="81145867" hostid="261"></div> Consulting firm RedSeer pointed out the trend in its recent Ground Zero report. “Consumers have been shopping for product or service quality of online retailers rather than price and are keen to continue shopping online in 2021 as well- which bodes very well for the continued growth of the online sector and makes it imperative for brands to focus on online offerings,” said Mrigank Gutgutia, director at RedSeer. Gutgutia broke it down further for Business Insider. “One dimension is that simply there’s one set of consumers who want to buy the usual products but even without a very large discount being offered online. There is another smaller category of customers who have grown increasingly conscious about the quality of the products, both these customers may have slightly different focussed channels,” he said. However, while this may be an urban-centric phenomenon, it’s not too different for Tier II and III e-commerce customers. Consumers from Tier II and Tier III cities chose <keyword id="6357762" type="UNKNOWN" weightage="20" keywordseo="online-shopping">online shopping</keyword> last year due to two reasons -- they wanted a safer experience and they began to trust online retailers for the quality of products. “In our consumer survey with thousands of users, we found that discounting was probably the 4th-5th reason which pushed people to shop online,” said Gutgutia. During the pandemic, as essential products became the most sought after category online, it was also the category that saw the highest average order value growth in the last year, which means that consumers opted for better quality products in FMCG. <div type="image" title="Average order value" msid="81145936" hostid="261"></div> During the fourth quarter of the calendar year 2020, the trend of choosing value over price was seen in Tier II and Tier III cities as well. <table style="border-width: initial; border-style: none; width: 468pt; table-layout: fixed;"><colgroup></colgroup><col /><col /><col /><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Tier II and Tier III cities </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2019 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2020 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Volume Growth </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">32% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">46% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Value Growth </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">26% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">43% </td></tr></tbody></table>Source: Unicommerce and Kearney report This trend of loyal online consumers didn’t go unnoticed by giant e-commerce retailers like Flipkart. Flipkart India CEO Kalyan Krishnamurthy during Walmart earnings results on February 18 said that they have seen a growth from trial only consumers to loyal, long-term consumers, which is pushing them to focus more on their subscription only programme in <a href="https://www.businessinsider.in/business/ecommerce/news/flipkart-gets-leaner-with-a-300-million-jabong-write-off-as-ceo-kalyan-krishnamurthy-lists-out-the-priorities-for-2021/articleshow/81105083.cms">2021</a>. <div type="Youtube" id="zUinE3RR_nU" title="Flipkart Gets Leaner With A $300 Million Jabong Write-Off" thumbUrl="https://i.ytimg.com/vi/zUinE3RR_nU/mqdefault.jpg"></div> <cmsannotation type="cmsannotation" annotationid="Growth of Direct to Consumer in this online paradigm" comment="subhead" text="Growth of Direct to Consumer in this online paradigm">Growth of Direct to Consumer in this online paradigm</cmsannotation> This shift from discounts to quality products has inspired customers to move away from aggregator e-commerce portals and look at Direct to Consumer brands for example, <a href="https://entrackr.com/2021/02/boats-income-crossed-rs-704-cr-in-fy20-with-460-growth-in-profits/">boAt</a>, <a href="https://yourstory.com/2021/02/mamaearth-hiring-d2c-personal-care-brand-revenue-run-rate">MamaEarth </a>who have seen an uptick in revenue, last year . Mangesh Panditrao, co-founder of Shoptimize, a startup which helps businesses come online, told Business Insider, "The COVID-19 pandemic sparked an increased preference for high-quality products that enhance wellness, with price consciousness being less of a factor. Organic food and wellness products, locally sourced produce, sustainably farmed goods, and vegan/cruelty-free products are now more popular. Our clients saw a 40% increase in AOV (Average Order Value) in this fiscal year compared to last year,” And experts like Gutgutia believe that this trend of online spending won’t change much in 2021 as well. “More than half of the people surveyed indicated that their spending would increase in 2021,” he said. SEE ALSO: <a href="https://www.businessinsider.in/finance/news/heres-how-to-avail-gst-credit-if-your-supplier-has-not-uploaded-invoices/articleshow/81145678.cms">Here’s how to avail GST credit if your supplier has not uploaded invoices</a> <a href="https://www.businessinsider.in/business/ecommerce/news/flipkart-gets-leaner-with-a-300-million-jabong-write-off-as-ceo-kalyan-krishnamurthy-lists-out-the-priorities-for-2021/articleshow/81105083.cms">Flipkart gets leaner with a $300 million Jabong write-off as CEO Kalyan Krishnamurthy lists out the priorities for 2021</a>

Discounts have dropped lower on the customer’s priority list, say Indian e-tailers

<ul><li>Competition heats up after <keyword id="80487" type="COMPANY" weightage="20" keywordseo="walmart">Walmart</keyword> closes its $16 billion acquisition of <keyword id="6354742" type="COMPANY" weightage="20" keywordseo="Flipkart">Flipkart</keyword>.</li><li>Alibaba and <keyword id="18635" type="CITY" weightage="20" keywordseo="Amazon">Amazon</keyword> are said to be eyeing large investments of their own.</li><li>Conventional retail and <keyword id="35621" type="PERSON" weightage="20" keywordseo="e-commerce">e-commerce</keyword> players are coming together for a hybrid online-offline business model.</li></ul>A turf war is about to break out among Walmart, Amazon Inc. and <keyword id="163405" type="COMPANY" weightage="20" keywordseo="Alibaba-Group">Alibaba Group</keyword> as the retail giants make aggressive moves to expand into <keyword id="3658" type="COUNTRY" weightage="20" keywordseo="India">India</keyword>. And it is highly likely that this will lead to a massive shakeup of the Indian retail space. Last week, Walmart said it had <a href="https://www.businessinsider.in/indias-competition-regulator-has-given-the-walmart-flipkart-deal-a-greenlight/articleshow/65337242.cms">closed</a> the $16 billion (₹1,118 billion) deal to buy the majority (77%) of Flipkart, India’s largest e-commerce company, following regulatory approval. This is Walmart’s biggest acquisition till date. In its aftermath, Alibaba and Amazon are said to be eyeing large investments of their own, according to media reports. Alibaba is said to be <a href="https://www.livemint.com/Companies/1mvbhDUjZd9khrSUroW5MM/Alibaba-may-invest-5-billion-in-JV-with-Reliance-Retail.html">considering</a> a $5 billion (₹350 billion) investment into a joint venture with <keyword id="58448" type="COMPANY" weightage="20" keywordseo="Reliance-Retail">Reliance Retail</keyword>, India’s largest retailer in terms of sales, in part to take on competition from Amazon and Flipkart. While Amazon, along with co-investors, is mulling an investment in the Aditya Birla Group-owned grocery chain, More, for an enterprise valuation between ₹45 billion and ₹50 billion. Alibaba has reportedly also held talks with other Indian retail chains including Future Retail. In the past few years, Amazon has pumped in over $5 billion into India, its fastest growing market. Amazon and Walmart have been in fierce competition in their home market, the US, for quite some time, while Alibaba and Amazon are head-to-head in China. Some fear that Walmart’s push into India could potentially have an adverse impact on the larger Indian retail space in the long term, particularly on the small brick and mortar retailers in the country. A nation-wide trade lobby group plans to protest the Flipkart acquisition by going on a nationwide strike in the coming months. Currently, over 95% of India’s consumer retail market remains unorganised, representing a huge untapped opportunity for organised retail chains. India has long restricted <keyword id="44749" type="ORGANIZATION" weightage="20" keywordseo="Foreign-Direct-Investment">foreign direct investment</keyword> in multi-brand retail to protect local grocers but allows 100% foreign direct investment in e-commerce companies that use the “marketplace” model. It is currently considering bringing in regulation for the e-commerce space and according to a recent draft proposal, may allow 49% foreign investment in e-commerce companies that use the inventory model. Walmart in its recent statement said its future investments into India will be directed at supporting farmers, supply chain development and reducing food waste. Strategy shift: Going hybrid Walmart’s acquisition of Flipkart and Amazon’s interest in More are the latest examples of large retailers adopting a hybrid business model of offline and online after years of experts predicting the disruption of traditional retail by e-commerce companies. Alibaba and Amazon have recently been focusing heavily on offline and online in their home markets – Amazon with its acquisition of grocery chain Whole Foods and Alibaba’s ‘New Retail’ strategy, which combines e-commerce and conventional retail in China. That rationale appears to be flowing down into their India strategy as well, points out Mrigank Gutgutia, engagement manager with RedSeer Management Consulting. Amazon also owns a 5% stake in Indian brick and mortar retail chain Shoppers Stop. While the Walmart-Flipkart deal is certainly encouraging for e-commerce players, even after 10 years and 100 million shoppers, Indian e-tailers have thus far managed to penetrate only about 2.7% of the overall Indian retail market, indicating the pressure to diversify their reach, notes Gutgutia. “While e-tailers have got their growth mojo back, everyone is starting to realise that pure online models will only let them capture limited pie,” said Gutgutia. “There is a need for change,” he added. Overall, as Indian e-commerce market matures further, e-tailers are realising that pure discount-driven models are no longer going to work. “What is needed is genuine innovation to cater to specific traits and needs of Indian buyers -- especially in offline-heavy categories like fashion and grocery,” said Gutgutia. According to RedSeer, this multi-channel approach will become dominant among organised retail players in the coming years, particularly for e-commerce players. Other e-tailers who have ventured into offline include furniture retailer Pepperfry with its studios and fashion retailer Myntra's Roadster stores. Regardless of how the investment landscape pans out and who buys whom, and as competition gets more intense for existing e-commerce and offline retailers, ultimately shoppers and customers are expected to win. As for small retailers, Gutgutia says they could see a positive impact if they work on a partnership model with organised retailers.

Clash of the titans: Amazon, Walmart and Alibaba to battle it out in India

<img class="gwt-Image" src="/photo/53057781.cms" /><a href="http://www.businessinsider.in/searchresult.cms?query=flipkart&amp;sortorder=effectivedate">Flipkart</a> has started planning for its ‘<a href="http://www.businessinsider.in/searchresult.cms?query=big+billion+day&amp;sortorder=effectivedate">Big Billion Day’</a> mega sale event slated for first week in October and is planning a slew of changes to avoid mismanagement. 
 This time around, <keyword id="6354742" type="COMPANY" weightage="100" keywordseo="Flipkart">Flipkart</keyword> may introduce loans for customers on the lines of ‘buy now-pay later’ model. It is also aiming to have a larger control over deliveries and customer service. 
 "BBD (<keyword id="2546653" type="UNKNOWN" weightage="20" keywordseo="Big-Billion-Day">Big Billion Day</keyword>) was earlier planned for 15-16 October but Flipkart has preponed it to the first day/week of October. What's being discussed right now is that the first BBD will be the big one, followed by medium and small BBDs," ET quoted sources as saying. 
 
The magnitude of this year's Big Billion Day will depend on how many sellers and brands Flipkart is able to get on board for the event and how much they are willing to discount, ET quoted a source as saying. 
 
In 2014, Flipkart’s first ‘Big Billion Day’ sale garnered $100 million, however, the India’s largest online marketplace drew flak over mishandling of volumes of orders and traffic on its website. 
 
To handle the traffic, Flipart has overhauled its online marketing budget. 
 
"Flipkart is in talks with several banks to disburse these loans, which will be underwritten by it. Flipkart is launching its loans product just to promote repeat purchases during BBD and win back the Metros," a second source told ET. 
 
<a href="http://www.businessinsider.in/Look-who-is-back-in-Flipkart-as-head-category-management-to-stop-Amazons-juggernaut/articleshow/52829082.cms">Kalyan Krishnamurthy</a> who has rejoined Flipkart as head of category management is going to handle the mega sale event. 
 "During the festival season last year, Flipkart was the clear market leader but now Amazon has overtaken <keyword id="541988" type="COMPANY" weightage="20" keywordseo="SnapDeal">Snapdeal</keyword> and is close behind Flipkart," Mrigank Gutgutia, engagement manager at internet consulting firm RedSeer, told ET, adding “this festive season could make it amply clear who is the market leader between Flipkart and Amazon."

Flipkart doesn’t want to bungle up ‘Big Billion Day’ sale in October, many changes expected

<img class="gwt-Image" src="/photo/54479787.cms" /> 
 
<a href="http://www.businessinsider.in/searchresult.cms?query=Amazon+India&amp;sortorder=effectivedate">Amazon India</a> gave itself a head start as it announced it mega sale from October 1st to October 5th while <a href="http://www.businessinsider.in/searchresult.cms?query=Flipkart+&amp;sortorder=effectivedate">Flipkart </a>and <a href="http://www.businessinsider.in/searchresult.cms?query=Snapdeal+&amp;sortorder=effectivedate">Snapdeal </a>have announced their sales to be from October 2nd to October 6th. Marketplace <a href="http://www.businessinsider.in/searchresult.cms?query=Shopclues+&amp;sortorder=effectivedate">Shopclues </a>will also hold its mega sale from October 1-10, while <a href="http://www.businessinsider.in/searchresult.cms?query=Alibaba&amp;sortorder=effectivedate">Alibaba</a>-backed Paytm is yet to announce dates for its festive sales. 
 
All the three companies are hoping to gain a large portion of their sales this festive season. 
 
Last year, online retailer were estimated to have sold goods worth somewhere around Rs 9,000 Crore in October. 
 "This year online retailers have tried to push the burden of discount on sellers wherever possible," Mrigank Gutgutia, engagement manager at research firm <keyword id="3359665" type="UNKNOWN" weightage="20" keywordseo="RedSeer">RedSeer</keyword> said. 
 
Merchants are not in the mood to come up with discounts on their own, therefore, online retailers might have a disappointing festive season. 
 
<a href="http://www.businessinsider.in/searchresult.cms?query=RedSeer&amp;sortorder=effectivedate">RedSeer</a> estimated that online sales may not exceed Rs 10,000 Crore in October this year combined. Last year, it was estimated that <keyword id="6354742" type="COMPANY" weightage="100" keywordseo="Flipkart">Flipkart</keyword>, <keyword id="541988" type="COMPANY" weightage="100" keywordseo="SnapDeal">Snapdeal</keyword> and <keyword id="6354743" type="COMPANY" weightage="20" keywordseo="Amazon-India">Amazon India</keyword> clocked combined sales of between $500- $600 million during the festive day sales. Flipkart alone is estimated to have sold goods worth $300 million during its famous <keyword id="3092441" type="UNKNOWN" weightage="20" keywordseo="Big-Billion-Days">Big Billion Days</keyword> (BBDs). 
 Flipkart will be looking to repeat the same performance so as to remain ahead of it competitor <keyword id="18635" type="CITY" weightage="20" keywordseo="Amazon">Amazon</keyword> India. Flipkart has bagged exclusive rights from brands like <keyword id="11148" type="CITY" weightage="20" keywordseo="Motorola">Motorola</keyword>, <keyword id="874458" type="COMPANY" weightage="20" keywordseo="Xiaomi">Xiaomi</keyword>, Reliance and <keyword id="6354427" type="CITY" weightage="20" keywordseo="Apple">Apple</keyword> over the last few months. The e-commerce giant is also betting big on sale of large appliances, besides extending its domination in the high-margin fashion and apparel segments. 
 
Snapdeal has recently renamed the sale as “Unibox Diwali Sale” and is planning to offer about 70% discount on home appliances, electronics, mobiles, home furnishings, furniture and FMCG. 
 
Amazon India is leaning on the largest selection of products - 80 million. It is also looking forward to increase its sales with improved customer experience with a pickup in its subscription service Amazon Prime. 
(image: Indiatimes)

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