Festivals are a great time to generate sales. In fact, retailers announce lucrative discounts and deals to leverage from these occasions. But, how leveraged they are from this entire exercise? What is their strategy to generate more sales? Let’s try to see a larger picture.
Boom time for retailers
As per the study conducted by Nielsen, events contribute to around 12 per cent of overall retailers’ sales. Among the festivals, Diwali topped the chart in terms of increased sales. Other festive offers also work for few retailers, as it is a combination of lower prices and peoples’ mindset who are more prone to shop during festivals.
Reiterating the same, Gelato Vinto, spokesperson says, “Festive offers are a way where we can give specific offerings to our consumers. These occasions definitely give higher sales but a wider range to the consumers as well.” Nielsen report suggests that commodities like soft drinks and chocolate contribute to 80 per cent of increased sales due to festive offers, hence, it is certainly a boom time for food as well as FMCG retailers.
Do festive offers work for all?
Undoubtedly, festive offers are irresistible promotions, which work alike to escalate the sales at least for limited period. However, it is quite crucial for brands to understand and analyze its customers and announce offers accordingly. Not all commodities have the potential to seek festival advantage. Addressing the same, Vijay Singh, CEO and MD, Aaramshop states, “We deal with ‘essentials’ which are shopped for the month and hence the category remains robust throughout the year. However, within the month it is the 1st week which sees the highest levels of buying as compared to festive offers. “.
Speaking further Dilip Kapur, President, Hidesign, shares, “We do not do festive offers as we have always felt sales should be driven by a desire for the brand values and not by price. We would only do an offer if we wanted to clear a product that we would no longer carry in the new season and not to drive sales per se.”
Apart from aforementioned, it is worth noticing that Indian auto industry is going through the rough phase. Society of Indian Automobile Manufactures (SIAM) has stated during Industry figures revealed last month that last festive season was totally failed in spurting sales.
Looking beyond festivals
Besides festivals, sales are also offered at the end of seasons to clear inventory. Moreover, few brands run promotional offers round the season. There is no dearth of retailers who are highly benefited from such schemes. Moreover, these discounts usually act as a ‘pull in the off season’ or the grey period. The Indian market is offer/ scheme driven, therefore such irresistible promotions, apart from festivities, work as a magnetic mechanism for the brand. Vandy Mehra, Group Director, Study By Janak, says, “We also follow a separate event calendar for the year to enhance customer interaction.” Moreover, any occasion that indicates celebration build a connect with the audience generating curiosity.