OLD IS GOLD
OLD IS GOLD, Cutlery, furniture, Sarojini, Consumer Research on Used Goods and Selling Trends. For Indians, the obsession for past does not limit to a memoir or a diary-entry. Cutlery, furniture, et al are what many still cherish possessing.
• 13 per cent of denizens were found to be stocking old goods, next only to Mumbai
• Attachment and antique values are the reasons for stockpiling
For Indians, the obsession for past does not limit to a memoir or a diary-entry. Cutlery, furniture, et al are what many still cherish possessing.
Sarojini, a septuagenarian still preserves her favourite cutlery and appliances made of brass. And, of late her weekly routine has stopped due to health issues. “Not only cutlery, almost half of the store room is filled with goods that are old. These are heirlooms; they were passed on from generation to another. I will not sell them,” beams Sarojini. Her daughter Padma echoes the same thought. “These goods have antique value, it will be foolish to sell them,” she shares.
Many of us must have also seen people possessing television sets have crossed their life time and are still working, so are the cars, bikes and bicycles. If these aren’t working they aren’t sold, they are kept in a store rooms. Not only just TVs and bicycles, but also old cutlery, wooden furniture, clothing, kitchen appliances etc. are all stored. If you ask why they are stored, the only answer is either attachment or their antique value. But most often many ignore the amount of brown money they are stockpiling.
In a recent survey conducted on Consumer Research on Used Goods and Selling Trends (CRUST) by OLX, city was placed second onlyt to Mumbai when it came to stocking goods. Thirteen per cent of the surveyed households in the city were found to be stocking used goods. The value contribution of these used goods was estimated at 15 per cent of the total value of used goods found across 12 surveyed cities. This figure was the second highest in India, behind that of Mumbai.
Some of the interesting observations made were:
• Clothing was the highest stocked category in Hyderabad at 65 per cent, followed by books which were stocked by 56 per cent respondents. Kitchen appliances was third on the list at 43 per cent
• A comparison with other cities also revealed that among all the surveyed cities, the city had the second highest stocked number of mobile phones, two-wheelers and home appliances
• The highest selling category was second-hand bikes at 12 per cent; followed by mobile phones which constituted 8 per cent
• Used mobile phones and bicycles or two-wheelers were the most bought categories at 8 per cent each
Triggers and Barriers:
• In South India, a majority (56 per cent) of people bought used goods as they found them to be less expensive (They found the same brands and products at a lesser price). This was followed by 36 per cent people who looked for value for money before buying. (They felt that they were getting more utility and return on the product for the money they had spent)
• Upgradation was the biggest trigger for the people in South India with 59 per cent of the respondents purchasing used goods.
• Fear of not getting enough value was what restricted people in South India from selling used goods – 47 per cent
The study found that Indians had a habit of stocking goods they no longer used, constraining the space at their home, as well as preventing them from liquidating those goods to earn money and buy items that were more relevant to them.
• As per the study, the total estimated realisable value of stocked goods across 12 surveyed cities was Rs 5,100 crore. In urban India this value was estimated at Rs 22,000 crore.
• The estimated total number of goods stocked in the 12 sample cities was more than 17 crore across the 15 different types of goods for which data was captured in the sample survey.
• Mumbai topped the clutter chart with more households’ stocking than anywhere else in India.
• Kitchen and home appliances categories were the most stocked followed by mobile phones, clothing, watches, and books.
“One of the key learnings from CRUST 2013-14 was that people needed to start thinking about the monetary value locked in the goods, not needed by them. OLX discovered this value to be huge. So definite and compelling is the potential of the used goods economy that OLX.in has decided to coin a term for the money locked in the used goods market called Brown Money,” said Amarjit Batra, CEO, OLX.in.
How much brown money is circulating in the Indian Economy?
In India at least Rs 22,000 crore can flow into the economy, according to OLX CRUST 2013. Curious to know the value of 22,000 crore in the Indian economy? It is 66 per cent more than the figure allocated to the Mid-day Meal Scheme in the budget of 2013-14, two-thirds of the figure allocated for the Mahatma Gandhi National Rural Guarantee Scheme in the same budget, and is equivalent to the amount that is likely to flow into the Indian social sector from the CSR activities of entire corporate India in 2014-15.
The study was conducted by IMRB International across 12 cities, across the four regions of the country. The research surveyed about 4800 consumers, chosen randomly across the age group of 19-60 years. The sample was a mix of users familiar and unfamiliar with the internet, and included regular and infrequent online shoppers, in order to arrive at an accurate assessment of the selling trends in urban India.
“With a value conscious mindset, the older generation tends to extract maximum value out of the used goods. However, the younger generation is less sentimental, and looks for faster product upgrade. With product lifecycles getting shorter, C2C classified companies need to target this mobile generation and provide the right environment and platform for C2C trading,” said Dipankar Sen, associate vice-president at the IMRB International.