India's Festive Season Sale Wraps Up with 14% Volume Growth, Driven by Emerging Categories and Tier III Towns A noteworthy trend this year was the performance of Tier III towns, which surpassed Tier II cities with a market share of 36.4 per cent in order volumes, compared to 23.5 per cent for the latter.
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This year's festive shopping season in India has concluded on a high note, recording a 14 per cent year-on-year (YoY) growth in order volumes. This year's Diwali sales also saw an 18 per cent increase in gross merchandise value (GMV) compared to 2023, signaling a robust consumer appetite and expanding market reach across the nation, as per a media release by Unicommerce. While popular categories like beauty and makeup products saw over 100 per cent YoY growth, this year's festival season witnessed a surge in demand across newer categories such as gaming accessories, travel accessories, and health devices.
Travel and health accessories led the charge, each recording a 100 per cent YoY growth in order volume. Gaming accessories also proved to be a breakout segment, posting an 85 per cent YoY growth in orders, driven by increasing interest in gaming and related equipment. In addition, kitchenware, dietary foods, healthy snacks, and supplements saw an over 30 per cent and 40 per cent increase in order volumes, respectively. Kids' apparel also enjoyed a strong showing, achieving a 30 per cent increase in orders, while toys and baby products reported over 50 per cent YoY growth.
Tier III Towns Outperform Tier II Cities
A noteworthy trend this year was the performance of Tier III towns, which surpassed Tier II cities with a market share of 36.4 per cent in order volumes, compared to 23.5 per cent for the latter. Meanwhile, Tier I cities and metropolitan areas maintained their dominance, accounting for the largest share of orders at 40.1 per cent. This growth underscores the expanding reach of e-commerce into smaller towns, fueled by increased internet penetration, improved logistics, and an eager consumer base in non-metropolitan regions.
To address the seasonal surge in returns, brands and e-commerce companies have increasingly relied on advanced technology solutions, which helped streamline operations and reduce returns. Electronics and gaming accessories, for instance, saw a reduction in return rates from 20.5 per cent in 2023 to 16 per cent in 2024. Travel accessories and books also recorded declines in return rates, reflecting enhanced consumer satisfaction and improved product offerings.
With the success of this year's festive season, the e-commerce sector anticipates sustained momentum as other major sale events, including Black Friday, Christmas, and the Year-end Sale, are set to take place. These upcoming events are expected to keep the e-commerce sector buoyant, catering to a consumer base eager for continued shopping and discounts.
