A Shift in Festive Spending
The desire to celebrate and spend remains strong, but the approach has matured. A September 2026 report noted that while 77% of Indian consumers plan to increase their festive shopping budgets, this figure is down from 83% last year, indicating a slight
moderation in overall enthusiasm. However, this doesn't mean people are spending less overall. In fact, the proportion of shoppers willing to spend ₹50,000 or more has actually increased slightly. This points to a more deliberate consumer, one who is prioritising high-value purchases over numerous smaller, impulsive buys. Retailers are observing this shift, noting that while footfall is recovering, there's a sense of measured confidence rather than a complete splurge.
The Lingering Effect of Inflation
A key reason for this cautious optimism is the persistent pressure of inflation on household budgets. Throughout 2026, the cost of essentials like groceries, fuel, healthcare, and school fees has continued to climb, often at a rate faster than salary growth. Even as headline inflation figures fluctuate, the 'felt inflation' in kitchens and monthly expense sheets remains very real for millions of families. With the inflation rate in August 2026 recorded at 4.82%, households are acutely aware that their purchasing power has been eroded. This has forced a more meticulous approach to financial planning, where non-negotiable expenses like EMIs, rent, and utility bills are ring-fenced before any discretionary festive spending is considered.
Smart Shopping Becomes the Norm
Instead of cutting back entirely, Indian consumers are getting smarter about how they shop. The pre-festive period is now a time for strategic planning, with shoppers actively seeking discounts, comparing prices online, and leveraging technology to find the best deals. Artificial intelligence (AI) is playing a growing role, with a high level of consumer interest in tools like smart search suggestions and virtual product try-ons to aid in purchase decisions. The festive shopping basket is also diversifying. While apparel and footwear remain popular, there is strong purchase intent for categories like jewellery, groceries, and home appliances, indicating that consumers are spending on a wider range of goods.
Value and Experiences Over Volume
This year's trend underscores a move towards 'considered consumption'. Families are choosing to invest in products and experiences that offer long-term value. This is reflected in the strong sales growth for large-screen televisions, four-door refrigerators, and automobiles, despite significant price increases in these categories. Online retail is projected to see its strongest growth in five years, driven not just by electronics but by categories like groceries, personal care, and fashion. This suggests that consumers are using the festive season to upgrade their lifestyles in meaningful ways, rather than just for fleeting indulgence. The rise of quick commerce and strong demand from Tier-2 cities further highlight how shopping patterns are evolving across the country.
