The latest report by Redseer Strategy Consultants on the Indian festive season, reveals the market readiness and seller’s bullish sentiments for a profitable festive season.
After a rocky first 3 quarters of the year CY23, online, sellers expect atleast a 15 percent jump in Festive sales y-o-y
Redseer surveyed a few hundred sellers (primarily the smaller sellers) prior to the festive sales 2023. Our findings show that despite modest sales growth on e-commerce platforms recently (only 40 percent of sellers we surveyed reported a >10 percent increase in current quarter sales vs JFM 23 quarter), anticipation for a festive sales boost amongst the sellers is high across categories.
Sellers expect a minimum 15 percent online sales growth vs last year’s festive event, with the median growth figure of 26 percent sales increase expected. Sellers across the categories including in the lower ASP ones like fashion are bullish about this growth trajectory, which should provide a respite in this otherwise challenging macro-environment.
e-Commerce platforms are tailoring solutions to meet the optimism of sellers and as a consequence of which, seller perceptions around support provided by eTailing platforms have seen an uptick – with 62 percent of sellers agreeing with the sentiment that the platforms have been supportive in their festive planning vs. 53 percent sellers who observed this in the lead-up to the last year’s festive season. Through our surveys, sellers have highlighted the strong support received from platforms in terms of data analytics, trends predictions, consumer visibility, among others.
Driven by this seller bullishness, they are expected to ramp up their ad spendings on the online platforms meaningfully- creating the right sales impact for themselves and also benefiting the platforms.
Our survey results indicate that sellers are willing to spend more on marketing/advertising during the festive season on online platforms to drive sales growth. Overall, across the surveyed sellers, they anticipate a 15 percent spending growth vs last year’s festive season and 50 percent ad spending growth vs business as usual (BAU) periods of this year.
Interestingly, smaller sellers are highly willing to spend on ads and bullish on overall sales growth- smaller sellers anticipate a 22 percent ad spend growth vs last festive season and 75 percent growth vs BAU period of this year per our surveys.
“Our interactions with seller prior to this 10th eCommerce festive season reaffirms the transformative impact eCommerce has on these MSMEs. 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. In the longer term, more and more sellers will continue to benefit from eCommerce growth given its strong positive impact on seller topline and bottomline that emerges from our research”, says Mrigank Gutgutia, Partner at Redseer Strategy Consultants.