41% Indians to curtail shopping budgets in new post-COVID normal

Though retail stores are opening up across the country, it will take a while for it to be business as usual. A consumer sentiment survey conducted by Retailers Association of India (RAI) and LitmusWorld says that over 62 per cent of Indian consumers plan to visit retail stores within the first three months of their opening. Around 32 per cent say that they would visit retail stores in the next 3-12 months, and only six per cent of consumers want to stay away from physical stores for more than 12 months. Over 75 per cent of consumers who plan to indulge in retail therapy in the next three months are residents of tier II and III cities, where the incidence of coronavirus pandemic is relatively lower than the metro cities. The not so good news, however, is that 41 per cent of consumers have said that their shopping budgets would contract extensively and only 6 per cent talked about higher shopping expenditure.

More women are opting to shop online than men. Around 60 per cent of women, as per the RAI report, prefer shopping online, while 64 per cent men prefer visiting offline stores. In tier II and III cities, 75 per cent of consumers prefer shopping offline. Though shopping for food and grocery shopping is a given, the RAI-LitmusWorld report says that 52 per cent of consumers are keen to buy clothes post lockdown, while 31 per cent want to invest in consumer durables. However, not all shoppers want to shop for apparels in physical stores. Around 79.50 per cent prefer buying clothes online. In fact, Kavi Mishra, CEO, House of Anita Dongre, in a recent interview with Business Today, had said that a consumer in Hyderabad bought 22 pieces of garments through a link that was sent to her by WhatsApp. Though the appetite to shop for apparels is surely there, only 8.19 per cent said that they would shop with an increased budget. The demand, therefore, would be more for basic clothing rather than high-end fashion. In fact, with work from home becoming a way life, most fashion brands are focusing on causal wear, and many of them are coming up with work from home clothing collections.

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Like apparel, 75.4 per cent consumers prefer buying appliances online. No wonder, from Godrej Appliances to Panasonic, all the leading consumer durable brands are stepping up their e-commerce offerings. They are also helping their traditional dealers to go digital. Amazon's recent initiative, Amazon Local, for instance, has a host of local consumer durable stores listed on the platform. So, when a consumer living in North Delhi searches for a washing machine or TV panel on Amazon, it will throw up details of not just the models available on the marketplace, but also details of local retailers in North Delhi. This will enable the consumer to browse the inventory at the local store, and if she wants she can go to that store and touch and feel the product before buying. The local store will also give her the advantage of delivering the product on the same day and installing it for her. Even in consumer durables, only 6 per cent consumers have indicated they would have an increased spend.

So, Unlock 1.0 will surely see pent up demand, but consumers are certainly not going to splurge. They are going to buy only those products which they haven't been able to buy due to the lockdown. So, a consumer not having a washing machine or dishwasher, may invest in one, but those consumers who already possess these products will surely hesitate to upgrade. Many retailers actually fear that demand may eventually dry up a couple of months post the lockdown.

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