Consumer sentiments bullish during Diwali despite inflation: Bharat Lab

Inflation is indeed important, but Diwali holds even greater significance for Indian consumers, according to a report by The Bharat Lab, a consumer and citizen-focussed joint-initiative of Rediffusion and the Lucknow University. While over 75% of respondents expressed their concern about inflation, when it comes to the categories in which they planned to spend, they demonstrated a notable willingness to increase their expenditure compared to the previous year, says the report. How much more were they willing to spend? Approximately 66% of respondents indicated they were willing to spend 50-75% more. With the festive Puja/Diwali/Eid shopping season in full swing, the Bharat Lab spoke to 1027 consumers (M=526, F=501) in the Hindi Heartland (mainly Uttar Pradesh) to gauge what’s on their shopping list this season. The sample covered the entire spectrum of Bharat consumers across age, income, and gender. The research investigated how their buying preferences in areas such as gifts, fashion, jewelry, automobiles, home décor, travel, entertainment, and more compared to their spending from the previous year.
Following are some of the key highlights from the report:

High interest in low investments - Across low, mid, and high income levels, more than 85% of respondents planned to cap their estimated family spends below 50K for the festive season. Home goods, especially white goods (on instalments) are high on the shopping list to mark Diwali. Among electronics, mobiles (also on instalments) remain the No. 1 favourite. Firecrackers to fizzle out - 72% of respondents reported that concerns around air pollution will influence their ‘aatishbaazi’ purchases. Low intent for sure. Brakes on the automobiles - With only 19% and 23% raising their hands for buying new 4-wheelers and 2-wheelers, this could be a difficult festive season for automakers in Bharat as a market. Maybe this trend on ‘intent’ actually belies the actual market situation which has been more buoyant.

Offline to edge out online, discountvertising holds fort - A touch above 56% of respondents reported that they would prefer to buy stuff from retail stores near them. 43% claimed that discounts would be a major factor in their purchase decisions if they really desire a brand. 72% however confirmed having bought something or the other from the maha-sales of e-comm sites. Aesthetics over repairs - While 52% were planning a renovation, home decor was an area of interest for more than 81% of those surveyed. Interestingly, interest in home decor increased with age, rising from 86% amongst 20-year olds, to 98 % for those above 50 years. Good news for paint companies? Home décor? Even brown & white goods for better homes? Travel more? 68% said yes. 21% would love to go abroad if they can afford it (and get a visa!)
More movies? Only 34% said yes. Netlix, OTT are good enough, they say.

Dr. Sandeep Goyal, Chairman Rediffusion and Founder of The Bharat Lab, opines: “Bharat’s consumer is at once austere and indulgent. Clearly, they care about inflation, but they want to ensure that it does not dim their Diwali. No wonder they have allocated more of their budgets to gifts, fashion, and home decor. Brands that invest in brand building will ensure that the Diwali momentum carries them deep into the wedding season up to December.”

Urging business leaders to up their Bharat game, Dr. Alok Rai, Vice Chancellor of Lucknow University and Chair of the Bharat Lab, added, “Of course discounts matter, but the Bharat consumer also cares about what brands stand for. Offline’s defiance is testament to the success of the vocal-for-local campaign. Also gifting being a priority is a healthy marker of the sense of community and family that Bharat takes pride in.”

Dean Dr. Sangeeta Sahu of Lucknow University drew attention to the environmental consciousness of the Bharat Citizen adding, “When three out of four respondents report cutting down on fire crackers citing pollution concerns, it’s a reflection of responsible citizenry being a part of Bharat’s cultural values.”

Divyanshu Bhadoria, Chief Strategy Officer at Rediffusion, and co-ordinator of Bharat Lab, concluded: ”This is the first of many critical buying moment studies we have in the pipeline for The Bharat Lab. But even this first report will give brands fodder to evaluate and reset their heartland strategy.”