Almost three-fourths of India’s urban population has been economically impacted by Covid-19 and about half are financially worse off than they were last year, according to a study by Kantar.
While the general sentiment is largely about fear and uncertainty, two-thirds of Indians seem cynical about the situation improving, the British market research company said in its latest report, ‘The New Indian Consumer,’ which surveyed 10,000 urban consumers across 15 Indian states.
“Most consumers have become cautious of what they spend on and actively look out for deals and discounts while making any purchases. However, they are willing to pay a premium for products that provide them convenience and makes lives easier,” said Hemant Mehta, chief strategy officer, South Asia, at Kantar.
The report comes as consumer companies across groceries, electronics, smartphones and automobiles expect strong growth in the current quarter. Companies estimate these segments will grow at 10% and more in the March quarter, helped by a low base, a revival in rural growth and increased spending on hygiene, immunity and personal mobility.
“There was a lot of pent-up demand, which is now playing out. Also, unplanned savings from entertainment and leisure activities or eating out are now being used to purchase big-ticket items,” added Mehta.
Sustained out-of-home activities and entertainment may resume only a year from now, according to the study.
Brand loyalty has taken a beating and product availability and competitive pricing are now more important, with consumers no longer going the extra mile for their favourite brand.
The bulk of shopping is driven by discounts, with almost 57% of the people delaying purchases or buying only when offered rebates. This is a sharp jump from less than 40% waiting for deals during the pre-Covid-19 period.
“The larger sentiment is that of being frugal and willing to wait for the opportune time to get a good deal,” said Mehta.