2025 Festive Shopping Trends: Online Spending Expected to Rise Significantly
Urban households in India are poised for a significant shift towards e-commerce this festive season, according to a recent report by LocalCircles. The study indicates a remarkable 115% increase in the number of households planning to shop online, driven by recent GST reforms that have boosted consumer confidence. While traditional markets still play a crucial role, the growing trend towards online shopping is expected to reshape festive spending patterns, with overall expenditures projected to reach Rs 2.19 lakh crore in 2025.
Rise in Online Shopping
The LocalCircles report, titled ‘How Urban Indian Households Will Spend During Festive Season 2025’, reveals that a substantial number of urban families are embracing online shopping. The survey, which gathered insights from over 200,000 responses across 44,000 households in 319 urban districts, highlights a shift in consumer behavior. This year, 28% of respondents plan to shop online, a significant increase from just 13% in 2024. The report attributes this change to the convenience, variety, and competitive pricing offered by online platforms, alongside the recent reductions in GST rates on essential goods.
Impact of GST Reforms
The government’s recent GST reforms have played a pivotal role in enhancing consumer confidence. By lowering prices on white goods and consumer electronics, such as air-conditioners and refrigerators, the reforms have made online shopping more appealing. LocalCircles founder Sachin Taparia emphasized that consumers are now looking for platforms that not only offer lower prices but also ensure easy returns and exchanges. This shift is expected to lead to a more value-driven shopping experience, particularly for items like smartphones, electronics, and home appliances.
Spending Trends for the Festive Season
The survey indicates that 37% of urban families anticipate spending Rs 20,000 or more during the festive season, a notable increase from 26% last year. Among those opting for online shopping, 44% plan to invest in smartphones and electronics, while a similar percentage is focused on home renovations. Additionally, 60% of respondents intend to purchase gourmet foods, groceries, and festive essentials, with nearly half planning to shop for fashion and beauty products. This diverse range of spending reflects the evolving preferences of consumers as they navigate the festive shopping landscape.
Future of Retail in India
While physical stores continue to dominate sales, the rapid expansion of online shopping channels is reshaping the retail landscape in India. The survey indicates a decline in the number of consumers planning to visit malls and local markets, with only 56% expressing intentions to shop in person, down from 70% in 2024. This trend underscores a significant transformation in how urban households approach festive shopping, highlighting the growing importance of e-commerce in the Indian retail sector. As the festive season approaches, it is clear that online platforms are becoming increasingly integral to consumer spending habits.
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