Festive demand looks encouraging despite inflation; says Kumar Rajagopalan CEO of Retailers Association of India

Mumbai: Ongoing festival season is supposedly the best compared to the pre-pandemic level. We at ET Now spoke to Mr Kumar Rajagopalan, CEO of the Retailers Association of India to understand the festive demand trends in categories and regions, in addition to the inflationary impact. Mr Rajagopalan says “From April-August good growth was seen averaging 20% over pre-pandemic. September demand trends look encouraging mainly coming from the East region with the first set of celebrations coming from this region. Retail sales in the East region are growing at 25% over pre-pandemic.”

According to Mr Rajagopalan, all categories are witnessing growth as it is for the first time since the pandemic that people are socializing, relatives visiting, people wanting celebration and eating out at restaurants. Hence, all categories particularly jewellery, footwear, restaurants and leisure segment doing well. “Overall growth is expected to be around 25% over pre-pandemic growth” he adds.

On demand coming from non-metros, Mr Rajagopalan mentioned that Tier 2,3 cities are doing well showing robust growth while the rural demand is picking out now due to better monsoon and buoyant sentiments. “In urban areas, there was a slight bit of worry as the lower middle class was not buying discretionary items. Demand for discretionary items will rebound this festive season. If prices don’t go up further, more growth can be expected across categories and cities”

On inflation hurting demand, he mentioned that financing modes are attractive and accessible in an easy manner supporting large items purchase. Consumers are buoyant despite inflation.

The strong traction was seen in the first phase of the festive season. As per reports, in its Big Billion Days sale, Flipkart recorded 35 million app downloads bringing in four million first-time customers. Amazon India recorded a two-fold jump in its customer base from Tier II and Tier III cities during the first 36 hours of its festive season sale.