Reveals the First Annual OLX CRUST Survey (Info-graph and Brown Money Note attached)
Bangalore, January 15, 2014 – OLX.in, the number one marketplace for used goods in India, and IMRB International, leading market research and consultancy firm, today announced the results of the First Annual OLX Consumer Research on Used-Goods and Selling Trends (CRUST) Survey for 2013-14 that looks at the used goods market in urban India and the attitude of urban Indians towards used goods.
The study found that Indians have a habit of stocking goods they no longer use, constraining the space in their homes, as well as preventing them from liquidating those goods to earn money and buy items that are more relevant to them.
· As per the study, the total estimated realizable value of stocked goods across 12 surveyed cities to be INR 5100 Crore. When projected to Urban India this value is estimated at INR 22,000 Crore.
· The estimated total number of goods stocked in the 12 sample cities was more than 17 Crores 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.
· The survey found the categories most stocked to be kitchen and home appliances, mobile phones, clothing, watches, and books.
“OLX is the first in its space in India to analyze the potential of the used goods economy. We are thrilled to be announcing the results of the First Annual OLX CRUST Survey and will be following it up with one every year. One of the key learnings from CRUST 2013-14 is that people need to start thinking about the monetary value locked in their used goods. OLX has 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 and call it Brown Money.” said Amarjit Batra, CEO, OLX.in.
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 life cycles 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 IMRB International.
Why do Indians Stocks Goods?
The survey found that the primary reason urban Indians are stocking used goods is because they feel they will use it at a later date (24% of respondents), although that rarely happens. Another 20% of the respondents said they have ceased to find value in using the product, implying a change in their taste and preferences, even though the product is in a good condition. Emotional attachment (17% of respondents) to certain products also makes people hang on to them. “OLX believes that every item can be used, but it is merely lying with the wrong user. By connecting people who do not have need for an item to ones who do, we encourage what is often called collaborative consumption, in which the same product is used by multiple users, not only enhancing the utility of the product, but also lowering depletion of personal and national resources, and ensuring greater sustainability.” said Amarjit.
Why Indians are selling used goods?
The survey indicates that the top trigger for selling used goods is to upgrade to a better product. Buying the latest product has become increasingly important for people today with 70% of respondents saying they sell used goods to earn quick cash and use it to upgrade to a better product. The desire to quickly upgrade has also led to a large number of nearly new, branded products that are up for sale at a much lower price. Space constraint, non-functionality of product (to the user), and maintenance cost leads to about 60%, 59% and 51% of the respondents selling second hand goods, respectively. The survey also discovered that Women often sell goods not wanted them during and after house cleaning, and during shifting of homes. However, 91% of the respondents do not wait for any particular occasion while disposing off second hand goods, whereas 4% wait for special occasions and festivals such as Diwali. This indicates that uncluttering homes, and earning money by selling used goods should not be reserved for special occasions.
Why are Indian buying used goods?
The survey also looked at why an increasing number of people are turning towards buying of used goods. Lower cost turned out to be the most critical factor with 87% of respondents saying used good marketplaces offer items that are less expensive, and 83% percent of respondents saying that it gave them a good brand at a much cheaper price. 82% of respondents also said online marketplaces, such as OLX, came with higher seller trust, as they gave the opportunity to meet the seller and test the product before the purchase. “OLX pioneered the concept of online consumer-to-consumer (C2C) classifieds in India. The used goods marketplace is on the cusp of a change in India. What CRUST 2013-2014 tells us is that the attitude of people towards used goods is changing. The insights gained will be helpful to not only businesses in the classifieds and e-commerce space but also to anyone who is interested in understanding how the aspirations of a rapidly evolving India are changing,” said Amarjit.