India’s E-Commerce Sees 24% Diwali Surge, Tier 2 Cities Lead the Charge – What It Means for Retailers

Outlook Start-Up Desk

Festive Growth Surge

India’s e-commerce sector wrapped up the 2025 Diwali season on a high, with order volumes rising 24% year-on-year and gross merchandise value (GMV) up 23%, according to Unicommerce, India’s leading e-commerce enablement platform.

Quick Commerce Growth

Quick commerce platforms recorded a remarkable 120% year-on-year increase in order volumes, emerging as the top growth driver for this festive season, while brand websites also posted strong 33% growth.

Tier 2 Cities Lead

Smaller cities powered festive sales, with Tier 2 towns contributing the most — driving a 28% increase in orders, followed by metros and Tier I at 24%, and Tier III at 23%.

Marketplaces Lead Sales

Online marketplaces remained the preferred shopping channel, accounting for 38% of total purchases during the Diwali period and recording an 8% year-on-year rise in order volumes.

PinInterest

Festive Category Trends

Top-selling categories included fast-moving consumer goods (FMCG) products like fusion sweets and dry fruits, home décor, beauty and wellness, and health supplements, showing diverse consumer demand across festive essentials.

FreePik

Rise in Prepaid Orders

Meanwhile, Prepaid transactions surged 26% this Diwali, reflecting higher trust in digital payments. Cash-on-Delivery also rose 22% in volume and 35% in value, showing continued consumer preference for flexible payment modes.

Faster Deliveries Achieved

Logistics data from Shipway, a leading e-commerce logistics and delivery management platform, showed that festive season deliveries were 15% faster, reflecting improved supply chain planning, accurate demand forecasting, and enhanced last-mile readiness.

Broader Digital Adoption

Unicommerce’s analysis of 150 million festive transactions shows India’s rising digital adoption and increased participation from smaller cities, driving robust e-commerce growth and stronger consumer confidence.

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