A problem of plenty? As Navratri signalled the start of the shopping season, this particular dealer had a very boom time problem. He had an unprecedented 22 car deliveries to be done in one day. And with a car delivery involving a handing over ceremony at a specific space at the dealership with a backdrop, a small puja in most cases, and clicking of photos, the dealer was at a loss on how to manage all within the contours of an eight-hour working day.
“I will have to slot 20-minute delivery slots,” he said, adding, “I have never had this many orders on a single day.”
It is a more-sweet-than-bitter situation many automobile dealers are facing, as India stares at a bumper festive shopping season in the days leading to Diwali, the festival of lights. Car sales are up by 16 per cent in October compared to last year, and mind you, the entire peak season from Navratri to Diwali fell in this month last year.
The bounty extends across most categories, with cars, smartphones and electronics traditionally clocking 40 per cent of their annual sales during this period. Even the services sector — flights, hotels, foreign travel and even luxury cruises— is recording full or near full capacity.
“When did we ever find Indians spending the kind of money on cruises ever,” asks Rajeev Singh, partner with the consultancy Deloitte India. “It is luxury, but people want that experience.”
The trend of premiumisation is evident all over in the rush for shopping goodies. Singh further explains, “After Covid there was an immediate demand for goods—cars, two-wheelers, consumer durables and so on. And that is now beginning to soften at some places; demand for experiential is now going up. Upper middle class and middle class want to spend. The upper class, even if they had money, were not really spending. And the middle class was always aspiring to go for premium, if not luxury products. That is the reason you see the demand for premium goods and services (like, say, cruises) now going up.”
Contrary to general belief, it is not that Indians have come into more money. After the Covid restrictions eased, there was a ‘pent up demand’. Sales surged also because people had saved a lot during the lockdown months. But since then, what has happened is that a general trend to splurge more and save less has taken over, especially driven by the increasing number of Gen Z (those born after the turn of the millennium), who have a different attitude to spending and saving compared to the generations before them, entering the workforce and earning money. The prevalence of social media and a digital first lifestyle also places a lot of aspirational pressure.
This, combined with the general confidence with the Indian economy which is showing robust future projections even as many leading economies falter on inflation and recession fears, means this festive season could go up, up and away. Consumer durable firms and fashion retailers expect double-digit growth in value terms during this season — the amount of interest Flipkart had for its annual sale, titled ‘Big Billion Days’ is case in point, with reports suggesting the online e-commerce major could score a gross merchandise value of up to Rs 36,000 crore during the 40 or so shopping days till Diwali.
Big ticket purchases like land also are showing a spike. According to data unveiled by Knight Frank on Wednesday, nearly 5,000 properties were registered during the nine auspicious days of Navratri last week, an increase of 37.4 per cent.
In the first 14 days of October, the city recorded a total of just above 3,000 registrations. But subsequently, in the following nine days of Navratri, it increased by 42 per cent, earning the state exchequer Rs 435 crore through registration fees and stamp duty.
“Registration volumes are expected to continue on a strong note as the festive season kicks in with the onset of Navratri followed by Diwali in the coming weeks,” said Shishir Baijal, chairman and managing director of Knight Frank India.
