Marketers said the shift was happening for last few quarters due to the fall in Covid infection rates and lifestyle returning back to pre-Covid days, but the transition to pre-Covid level consumption has largely been completed last quarter across multiple categories like apparel, fast moving consumer goods (FMCG), laptops and household appliances.
Consumers are back to buying what they used to buy before the pandemic and categories which got a Covid boost like athleisure and lounge wear, health and immunity supplements, balms, hand and household sanitisers, dishwashers, vacuum cleaners and even laptops are back to pre-pandemic level of consumption, said chief executives and market researchers. Several of these categories even saw demand outstripping supplies in 2020, 2021 and for some months of 2022.
Leading apparel company and retailer, Aditya Birla Fashion and Retail said in its latest investor presentation released this week that categories have reset to pre-Covid base in the December quarter with wedding and work wear ahead of pre-pandemic levels, while athleisure and lounge wear (which were hero categories in last two years) sales growth has become sluggish.
FMCG companies like ITC, Emami and Dabur said in their December earnings release and analyst calls that sales of hygiene products, balm and pain management, health and immunity supplements were subdued.
Emami Ltd president (healthcare) Gul Raj Bhatia told analysts last week that during the two years of Covid, consumers had gone for very high levels of health supplements and immunity product purchases but now they have gone back to the pre-Covid kind of scenario. “So we would see the market coming back to the pre-Covid levels in terms of the purchase,” he said.
Dabur chief executive officer Mohit Malhotra said post the January-March quarter, the bases for categories like healthcare which were at a high due to Covid should normalize. He told analysts that this year to date, Dabur’s healthcare business and ethical businesses have declined by 7% and 6% respectively due to “huge components of Covid contextual products”.To be sure, the drop in sales of these categories had largely started from April-June quarter of 2022 when Covid infection rates had started to plummet, consumer mobility started improving, and offices and educational institutions opened up. However, some like hand sanitizer sales are on a decline for 3-4 months before that.
Santosh Desai, social commentator and MD, Futurebrands Consulting, said some of the things that were already changing Covid accelerated that but fundamentals will remain the same.
“During Covid, consumers were responding to a sudden change in lifestyle. Now that Covid has abated, everyone is going back to what was normal. For instance, for people going to office the focus is more on comfort wearing which means comfort in formal wear and not in athleisure,” he said.
According to the latest data by IDC India, the personal computer market in India declined by 11.7% year-on-year in the July-September quarter after eight consecutive quarters of growth. While the researcher is yet to announce data for Oct-Dec quarter, it has said the slowdown in sales will continue for at least next two quarters.
Wedding demand – which became muted during the Covid years of 2020-22- has shot back driving sales for premium retailers and brands since November-December.
Sunil Kataria, CEO, Lifestyle Business, Raymond, said customers are going all out and shopping for all the occasions that make up Indian weddings. He said this is a healthy indicator of the buoyancy within the apparel industry.
Some even think the all-time high inflation since last year may have played a role since consumers were cutting down on unnecessary and discretionary spending, which some of these categories had become.
Similarly, home appliance makers said sales of dishwashers and vacuum cleaners – which had shot through the roof during Covid with continued supply crunch for over 6-7 quarters – have returned back to pre-pandemic levels with domestic help back in all households.
