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What and how consumers are buying in time of Covid

As people are home-bound, the furniture sector seems to be the only outlier with sales getting back on track. As people are home-bound, the furniture sector seems to be the only outlier with sales getting back on track. As people are home-bound, the furniture sector seems to be the only outlier with sales getting back on track. As people are home-bound, the furniture sector seems to be the only outlier with sales getting back on track.

The unlocking may have happened in phases and economic activity normalised to a certain extent, but demand and consumer spending still continue to remain tepid. Consumers, gripped with uncertainty due to job losses and pay cuts, are buying large product packs to save money and also stock up on items. Doodling books and painting accessories have emerged as the new discretionary spends.

Devendra Chawla, MD & CEO at Spencer’s Retail and Nature’s Basket, said consumers continue to be cautious and are spending on large packs of processed foods and immunity boosting products like honey and chyawanprash. Purchases of personal care items barring hand wash and cleaning products remain sluggish. There are also few takers for discretionary food categories like organics, olive oils, ready-to-eat packs and energy drinks. Spending on the general merchandise category is restricted to need-based consumption. The retailer is betting on the festive season for the revival of the non-food segment and demand for fancy gourmet products. “However, there is a cautious optimism among customers and retailers for festivals and ordering will be on a staggered basis,” said Chawla.

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A Marico spokesperson said there has been a significant increase in in-home cooking and consumption, with customers seeking only products that are healthy and immunity-boosting in nature. Marico anticipates this consumption pattern to be “a permanent trend” going forward. For Mother Diary, however, the fresh market launch of breads, haldi milk and ice cream chocolates have worked favourably.

Siddhant Kamath, director at Naturals Ice Cream, observed that the local consumer seems to be emulating the “stock up method” prevalent in the West due to the “uncertainty of the times”. Consumers are indulging in one-time purchases rather than sticking to a certain number of tub buys seen during pre-Covid times. Consequently, consumers bought two to three family pack of ice-creams priced around Rs 300 in one go. “The number of transactions has reduced, there is a decrease in walk-ins, but the ticket size has improved greatly,” explained Kamath.

A similar spending pattern has been noticed in the consumer durables segment as well. KG Singh, VP marketing at Whirlpool India, said the preference for larger capacity refrigerators (over 300 litres) in line with the need to store more for longer and minimise the number of trips to the market is one clear “emerging trend”. Work from home triggered a strong demand for home appliances in the months of June and July and Singh expects the festive season to only bolster the demand trajectory. Singh also pointed out that the pandemic has led to the overnight creation of dish washers as a category, leaving brands to refill the product shelf at regular intervals.

Ritesh Ghosal, CMO at Croma- Infiniti Retail, however, said it will be premature to predict if the festive season will boost spending. Buying is limited to need-based consumption and work-from-home enablers like laptops and smartphones have done well. Restricted movement has hit impulse shopping and categories like audio headsets have seen contraction. Average per day tickets are nearly 13%-15% lower than last year but average ticket sizes are higher on the back of planned purchases.

Fashion retailer Shoppers Stop said while in the first phase of unlock, customers were more inclined to shop only essentials, in the third phase, they seem to be moving back to include lifestyle purchases leading to the onset of sales recovery and an increase in walk-ins from consumers living in close proximity.

Clothing for work from home and school from home, nonetheless, continue to dominate the shopping cart. Bill values are higher compared to pre-Covid as consumers increasingly opt to buy all products in a single visit, said chief customer officer Uma Talreja.

Snapdeal said demand for fitness products, gym equipment, gardening essentials, doodling books, painting items and knitting accessories has taken precedence in the later phases of the lockdown.

As people are home-bound, the furniture sector seems to be the only outlier with sales getting back on track. Pepperfry said its overall business is back to the pre-Covid levels, led by the online segment which stands at about 120% of pre-Covid levels. Sales at physical stores are at 60% of the pre-Covid period.

Consumers are back to buying beds, sofas and wardrobes besides spending considerably on home decor items. “As consumers spend more time at home, they feel the need to make their home environment more aesthetic and conducive to mental and physical well-being,” said CMO Kashyap Vadapalli.

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