Online festive sales to rise to Rs 1 lakh crore led by quick commerce growth: Report

In quick commerce purchases, speed of delivery appeals to more consumers than discounts, according to a survey by Datum

Quick commerce is projected to account for about $1 billion in sales (8 percent of the total sales) during the season

The upcoming festive season is expected to see e-commerce sales rise 23 percent year-on-year to reach about Rs 1 lakh crore ($12 billion), driven by a surge in quick commerce purchases in categories like cosmetics and grocery, according to a report by market research firm Datum.

Quick commerce is projected to account for about $1 billion in sales (8 percent of the total sales) during the season, while it would contribute to 51 percent of online grocery sales, the report said. However, large categories like mobile phones and fashion categories will continue to dominate festive spending, and account for 50 percent of sales.

E-commerce majors Flipkart and Amazon will start their annual festive sales from September 26, the companies announced earlier this week.

The festive months are typically the busiest shopping season in India. The season peaks during Diwali and continues till Christmas.

Festive season gross merchandise value (GMVs) have ranged from 18 to 20 percent of overall annual GMV since 2018, which means the 4-5 week season has a disproportionate bearing on the yearly sales of online marketplaces and retailers. The festive sales have been growing twice as fast as online retail in India, according to industry estimates.

Typically, the festive season sales is a time when e-commerce majors jostle hard to gain market share from competitors by attracting consumers with large discounts and offers. Over the past few years, the contenders for the top 3 slots in terms of purchase volumes have been the same — Flipkart, Meesho and Amazon.

In a survey of 2,000 online shoppers conducted by Datum, 65 percent of the respondents said that they will make purchases from Flipkart, 61 percent said they will order from Amazon and 51 percent chose Meesho.

But, the surprise was thrown by a significant number of respondents opting for quick commerce platforms as well — 29 percent said they will shop from Zomato-owned Blinkit, 24 percent chose Swiggy’s Instamart and 23 percent preferred Zepto in the survey.

In quick commerce, the speed of deliveries seems to be trumping discounts offered for the value-conscious Indian buyer — as 36 percent of the respondents said that their key motivation behind buying from quick commerce platforms would be faster delivery, whereas only 32 percent opted for discounts.