E-commerce platforms are expected to potentially clock over US$ 9 billion gross GMV (Gross Merchandise Value) during the festive season this year as against US$ 7.4 billion last year - a growth of 23 percent.
For the full year, the overall online gross GMV is expected to touch US$ 49-52 billion, which is around 37 percent higher than last year (US$ 38.2 billion), primarily driven by strong consumer funnel expansion and the high adoption of online shopping post-COVID across the categories, RedSeer said in its E-commerce Festive Season Report.
During the first week of the festive season, online platforms are expected to register 30 percent year-on-year growth in gross GMV to US$ 4.8 billion, it added.
"The growth will be mostly driven by the accelerated online adoption which has been witnessed as an effect of COVID. Secondly, tier-II cities and beyond will continue to drive growth as they are 55-60 percent of the total shopper base this year, similar or higher than 57 percent in 2020 festive days," Mrigank Gutgutia, Associate Partner at RedSeer said.
On the other hand, as offline retail and mobility is recovering almost up to pre-COVID levels, this will impact the online festive sale as customers may opt for offline shopping as well, he added.
In terms of categories, mobile will continue to dominate - driven by new launches - and account for 11 percent of the gross GMV (US$ 4.8 billion) in the first week of the festive sale.
The electronics and appliances category will continue to grow (from 14 percent share festive sale last year to 16 percent this year), driven by ever-expanding selection and reach, and consumers holding back their purchases (earlier in the year) in anticipation of new launches and attractive pricing, Redseer said.
Affordability constructs, including EMIs and Buy Now, Pay Later (BNPL) are expected to be a strong growth lever in this category, it added.
Fashion, as a category, is also expected to see a steady recovery this festive season - in line with greater outdoor mobility of consumers and steady rebound of fashion/office wear, RedSeer said.
The report found that sellers are very bullish on this year's sales and are looking to recover the losses suffered due to COVID.
Nearly 80 percent of the sellers surveyed said festive sales will play a key role in recovery from COVID losses.
"We believe that the 2021 online festive sales will continue to ride on strong tailwinds of greater consumer digital adoption supported by an increasingly positive macro and consumption sentiment post the COVID second wave has passed. At the same time, we see strong bullishness in sellers towards online festive sales as about 80 percent of them believe that the festive sales will enable them to drive strong sales growth and make up for the losses during the COVID period," Ujjwal Chaudhry, RedSeer Consulting Associate Partner, said.
RedSeer expects strong 30 percent y-o-y growth in festive sale week in 2021 to reach US$ 4.8 billion in gross GMV with growth across categories, and setting the stage for a strong year for e-commerce in 2021, he added.