Spurred by festive season & corporates, India’s gifting industry gathers pace
Rajita Shetty from Mumbai has the passion of baking and did a 3-month baking course from Dadar Catering College. Her first task was to bake cakes and cupcakes for an event for her child’s playgroup. With the appreciation and love received for her baking, Rajita saw a potential career for herself. Today, she bakes a variety of confectionary products and has a promising business with a sizeable revenue. The demand increases by 40 per cent during the festive season, with a special focus on smaller items like cookies and cupcakes.
Similarly, Amandeep Singh Chawla, who joined his brother Gagandeep Singh's business after finishing his bakery & confectionery course from London, created Kickshaaws Chocolates under the company name of Bon Bar Pvt Ltd. Specialising in chocolates, they offer a variety of products according to customer’s needs ranging from designer chocolates to simple and pure chocolates. Based out of Mumbai, Kickshaaws focuses on the wholesale market and specialises in gifting during the festive season. Similar to Rajita, Kickshaaws, too, sees an increase in orders during the festive season in comparison to the rest of the year. Customers like to order their version of the Nutties much more than their other products.
This is just a glimpse of the gifting business during the festive season. The markets are full of gift packs ranging from beverages, chocolates, sweets, juices, and many other products, which draw people in huge numbers as they hunt for the perfect gift for their friends and relatives.
Along with food and beverage players, it is also the time of year for some of the traditionally gifting brands to give a heavy push to their sales efforts. For instance, kitchenware brand Borosil has been advertising in The Times of India editions across the country to reiterate its image as a gifting brand. Other brands in this genre seen ramping up their advertising plans include Pierre Cardin, Ellementary, Signoraware, Cadbury and many others.
Here are a few print ads by brands during the festive season:-
The idea is clearly to target both B2B and B2C consumers. However, gifting is something which is category agnostic. For instance, even Tanishq positions itself as a gifting brand and even a mobile phone can be a gift.
Gifting in India can be split into 3 broad categories – Festival Gifting ($7.5 billion), Personal Gifting ($20 billion) and Corporate Gifting ($2.5 billion).
There has been a clear shift from traditional gifts to customised gifts (as well as their innovative packaging) in the corporate gifting segment. And this increasing demand for unique gifts by the corporate world has helped establish gifting as a booming business stream in itself over the years. Corporate gifting makes up 80 per cent of the total market share. The advent of a digital economy and growing per capita income of the millennials is facilitating the overall growth of the gifting market in India.
The corporate gifting industry is growing at a whopping 200 per cent annually, as per a 2017 report by Technopak, a management consulting firm. The report also stated that the market size of personal and corporate gifting is around Rs 250,000 crore, with the corporate sector alone contributing approximately Rs 12,000 crore.
The global gifting market is estimated to be $475 billion, with India having the potential to be one of the strongest contributors. As per reports, the country is set to touch $84 billion by 2024 from $65 million at present.
There are certain factors that are contributing to the gifting market in India, which include:
- Increase in purchase power of the millennials
- Influence of western culture
- Booming e-commerce industry
- Unconventional approach by retail brands
The gifting market in India spans across players – be it home entrepreneurs like Rajita and Amandeep or large corporates like Tanishq, Mondelez, etc.
Mondelez, a veteran in this market, sees a lot of demand for its Cadbury Celebrations during the festive season. They advertise heavily across media platforms. They also have a website called Cadbury Joy Deliveries, where customers can choose from a range of chocolate products and also personalise them with the name, message or picture of their loved ones. The website also provides with free deliveries. With a price range of Rs 150 to Rs 1,200, they have something to suit any pocket.
Mondelez India’s spokesperson said, “Over the years, Mondelez India has been an intrinsic part of festivals. Our gifting portfolio both in retail and on e-commerce (including our direct to consumer website, Cadburygifting.in) brings alive the festive spirit by getting people together, especially during key Indian festivals like Raksha Bandhan, Diwali, etc. While Cadbury Celebrations has become India’s favourite gifting brand, Mondelez India continues to offer tailored experiences, which now includes personalisation on our e-commerce platforms. Beyond products, our festive campaigns also bring alive the acts of generosity that make our festivals full of warmth and renewed good feelings amongst relationships far and close.”
Several news players are also entering the market, which will further grow the gifting business in India beyond just the festive season. The growing demand for novelty items, greater personalisation offers and customers looking for gifts beyond the usual functional products will spur the industry further.