Opinion Details

Diwali and Indian Economy - By whatzoff Team

26/10/2019

In a few hours from now, the night sky across urban and rural India will come to life.

The country, already in the grip of Diwali, the annual festival of lights, will break into celebrations, praying, lighting lamps, bursting crackers, exchanging sweets, gambling through the night, and making merry in general.

Though a Hindu festival, Diwali is celebrated across communities in India and by the country’s wide-ranging Diaspora.

Diwali marks the peak of India’s longest festival season, which begins with lord Krishna’s birthday at the end of the annual torrential rains in August and goes on up to New Year’s Day. It is also the time that the country’s economy receives a huge boost as consumption perks up.

People splurge on clothing, gifts, food, and sweets, among other things. In fact, the four months from September to December contribute a major chunk to the annual sales of consumer durables. Every year, e-commerce majors like Flipkart and Amazon cash in on the euphoria with eye-popping discounts of up to 80% on mobile phones and ethnic clothing.

It’s that time of the year again when the high street outlets, the brightly-lit shopping malls, and even your local store across the street will put up display boards screaming “Sale”, “Diwali Dhamaka”, and “Diwali Bonanza”. Online stores will be brimming with schemes and offers, and your inboxes will be flooded with notifications of festive sales and extra special discounts.

It’s also the time of the year when these offers will be lapped up with a smile, as millions of Indian shoppers happily pull out their purses to make purchases.

Big Boom Diwali for E-Commerce Companies

According to the latest study cited by Business Today, e-commerce brands like Amazon, Snapdeal, and Flipkart sold $3 billion (Rs 19,000 crore) worth of products during the six-day festive sale this year.

The study further predicts that e-commerce companies in India will generate GMV (Gross Merchandise Value) sales to the tune of nearly $6 billion (Rs. 39,000 crore) over the entire festive month until the end of this month. The sales of Flipkart and Amazon will increase by 30% in 2019, compared to the GMV of 2018’s festive season, according to the study.

In 2019, Walmart-owned Flipkart led the festive sales with a standalone GMV of 60% against its own record of 51% in 2018. Along with other group companies, such as Jabong and Myntra, the e-commerce company seized a total market share of 63%. Flipkart’s rival, Amazon, grabbed 30% of the market share during the festive sale, the survey said.

2019 Diwali Spending Trend

In August 2019, YouGov conducted a survey to sense the excitement of people about Diwali shopping and to evaluate consumer sentiments about ongoing promotional offers.

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