Consumers set to loosen purse strings as vax drive, urge spending to boost feelings
NEW DELHI : Indians in cities could open their purse strings this festive season after a low-key affair last year. Consumer sentiment has yet to fully recover from the devastating second wave and has returned to pre-Covid levels, but an intensification of the country’s vaccination campaign coupled with consumers’ intention to go out and socialize has improved their intention to spend more this holiday season.
YouGov’s Diwali Spending Index reveals a propensity to spend of 90.71 among urban Indians this holiday season. Intention to spend is higher than last year when it was 80.96, although it remains below pre-pandemic levels when it was 100. This indicates a renewed appetite for spending among urban Indians, YouGov said.
YouGov surveyed 2,000 respondents to India’s online panel in August 2021. The sample consisted mainly of urban consumers in socio-economic classes A and B. However, respondents also raised the uncertainty about to their current finances.
The change in mood comes in the wake of the second wave which drastically dulled consumer confidence and once again halted discretionary buying.
YouGov data suggests that consumers, who have lived more confined lives for the past 18 months, are looking for more opportunities to spend. “This is probably the factor that has improved the overall feeling of spending more this Diwali compared to the last,” he said.
Festive spending is a big factor for most retailers in categories such as clothing, electronics, giftware, and housewares. Companies are already increasing their supplies to the market and ensuring stock availability.
Up to 29% of all respondents agreed to increase their spending this holiday season compared to the period the previous year. In 2020, 17% agreed to increase their festive spending.
“Although spending intentions have not yet returned to normal (pre-pandemic period), we are seeing a marked improvement since last year and this is good news for brands trying to win over consumers. in this holiday season “, according to the survey.
Meanwhile, 31% of respondents plan to spend less than a year ago. That number is down from the 54% of people surveyed who planned to cut spending for the holiday season in 2020.
However, despite an improvement in sentiment compared to the period last year, households remain cautious and uncertain. “Almost 50% of people polled last year said they pay more attention to their finances than they ever were in the past. Now a similar proportion, 43.6%, feel the same, indicating that fear of the uncertain is still strong among the public, ”he said.
Given that 2021 has seen a devastating wave of covid, despite public enthusiasm for Diwali this year, consumer sentiment is still not on par with pre-pandemic sentiment, he said.
Brands will need to work smart to capture this recovery, said Deepa Bhatia, Managing Director of YouGov India.
Respondents showed a higher intention to buy smart home appliances, Bhatia said. “The next holiday season will certainly benefit from a recovery in consumer appetite, although we must keep in mind that consumer confidence has not completely returned to pre-pandemic levels,” a- she declared.
YouGov’s Diwali Spending Index is calculated as a weighted impact of 10 factors, including increase in gross household income, increase or decrease in household spending, intention to invest or make follies and general optimism towards the economy and their intention to spend more or less this season of Diwali. against the last.
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