OLX.in has revealed the results of the second edition of the OLX CRUST (Consumer Research on Used-Goods and Selling Trends) Survey for 2014-15 that estimates the size of the used goods market in India to be INR 56, 200 Crore (USD 9029 Million). CRUST is the first comprehensive research in India that estimates the size of the used goods market in India and examines key attitudes towards used goods.CRUST 2014-15 was conducted across 16 cities in urban India and discovered that one-fifth of the goods being stocked in urban Indian homes have ceased to be relevant to them. Last year CRUST estimated the market for used goods to be INR 22,000 Crore.
CRUST was conceived by OLX as an attempt to understand and analyze the used goods space in India. In addition to conceiving the CRUST Survey in 2013-14, OLX also conceptualized the term â€˜Brown Moneyâ€™ that refers to the money that is locked in goods gathering dust in our homes. At least INR 56,200 Crore is simply lying locked at home in the form of items which are no longer being used across urban India. This amount is so huge that it is enough to launch the Mars Orbiter Mission Mangalyaan 125 times over, can clear entire arrears of the Food Corporation of India ,and is one-and-a-half times the annual budget allocation for the Mahatma Gandhi National Rural Guarantee Scheme. 99% of people in Mumbai indulge in stocking used goods in their households.
Amarjit Singh Batra, CEO, OLX India stated, â€œBefore we instituted CRUST in 2013-14, there were only guess estimates on the size of the used goods market in India. CRUST for the first time put a figure on this market â€“ INR 22,000 Crore in 2014, and INR 56,200 Crore in 2015 just in urban India. If we take the whole country into account, then this number will be much higher. At OLX we are committed to helping people unlock the money hidden in used items. From a country of scarcity, we are moving towards a country of abundance for at least some people. People are buying more, consuming more, and in the process wasting more. OLX helps people waste less through collaborative consumption and extending the life-cycle of the products.â€
â€œAs a brand, OLX aspires to positively impact the nation, the environment, and the lives of people. Brown Money has a favorable impact on personal finances and the overall economy. By helping goods find right homes, we are also ensuring greater utilization of products and less wastage. And by providing a platform for people to sell and buy used goods, we are managing to touch their lives by helping them fulfill their aspirations,â€ added Amarjit.
The insights gained from CRUST will be helpful to not only the classifieds industry but also to anyone who is interested in understanding how the aspirations of a rapidly evolving India are changing.
Indian Consumer Behaviour Trends Related to Used Goods
The shelf life of used goods in India: Stocking has been a prominent trend this year as well with 87% households stocking used goods in India, while 45% indulge in selling these goods.
Consumer behavior towards used goods (regional perspective): While Northern India tops the selling chart with 48% households doing so, the Eastern region leads stocking with 97%, and the West is the frontrunner in buying of used goods. 83% of Delhi households have unused items lying at home. Kolkata residents seem to be the most eager to sell their used goods – 85% respondentssaid so – while Bengaluru is the least-selling friendly metro. The heritage city of Lucknow records the highest sale of books with 31% people selling off their used books.
Cultural factors affecting attitudes towards used goods in India:
Why does India Stock: The key reason for stocking remains to be a wish to use these goods at a later date. (31% households said so). 18% owe their stocking habits to the sentimental value attached with the goods.
Why does India Sell: Aspirations play a key role here. The wish toupgrade to better products triggers about 51% of the respondents to sell;close to 33% people sell used goods because they feel that the goods are simply lying at home unused.
Why does India Buy: While, overall, the highest motivational factor for buying used goods is that these products are less expensive than new goods (69% said so), 50% respondents also buy used goods because the product quality meets their requirements.
Categories of goods traded:
What does India Stock? The top three categories of goods stocked across India are Clothing, Kitchen Utensils, and Books. This is followed by mobile phones.
What does India Sell? Books are the highest sold product with 17% having done so in the last one year. Categories with high value and high perceived usabilitysuch as mobile phones experience a higher incidence of selling compared to last year.
What does India Buy: Mobile phones and Consumer Durables are the highest bought categories across the country.
What is young India thinking/doing: Young adults* constitute a large part of the Indian population and they play an instrumental role in defining the trends in the country. The CRUST Survey for 2014-15 has taken an in-depth look into their behavioral pattern to find that87% of young adultsstock goods. 51% young adults sell used goods to upgrade to better products and lifestyle. 23% of people in the age group of 19- 23 years bought 3-5 used goods last year.
*Young adults refer to those in the age group of 19-23 years
As highlighted in the first OLX CRUST survey, Indians have a prominent habit of stocking the used goods in their households. These goods, if otherwise sold will be of immense monetary benefit. The potential of used household items being stocked can be unleashed if these goods are sold thereby creating a sustainable market for second hand goods.
OLX CRUST Survey Details
CRUST included a qualitative research followed by a quantitative study across 16 cities in the country covering 3 town classes â€“Metros, Tier 1, and Tier 2. The towns covered included, Delhi, Mumbai, Chennai, Bangalore, Hyderabad, Kolkata, Patna, Guwahati, Ahmedabad, Lucknow, Jaipur, Chandigarh, Indore, Kochi, Bhubaneswar and Pune.