India’s premiumisation wave spreads beyond metros, reshaping brand playbooks
Rising aspirations, e-commerce access and EMI financing are pushing upgrades across beauty, smartphones, appliances, beer, travel and housing. Brands including L’Oréal India, Godrej and AB InBev are targeting affluent consumers in Tier II and smaller markets alongside metros.
What happened
L'Oreal India · Indian consumers are upgrading across housing, travel, vehicles, appliances, smartphones, beauty and beer. Brands including L'Oreal, Godrej and
Key facts
- 54% of residential sales in eight major cities were above Rs 1 crore in H1 2026, versus 49% a year earlier
- International air travel grew 3.9% in FY26
- Swiss watch imports rose 37% in H1 2026
- Premium-oriented FMCG households spend up to 2.3 times more per trip in some categories
- 40% of L'Oreal India beauty sales are products priced below Rs 100
What changed
Indian consumers are upgrading across housing, travel, vehicles, appliances, smartphones, beauty and beer. Brands including L'Oreal, Godrej and AB InBev cite rising rural and smaller-city premium demand, supported by aspirations, e-commerce reach and easier EMI financing.
Why this matters
Tier II demand is becoming a core premium-growth engine, requiring localized assortments, EMI-led conversion and omnichannel service rather than metro-only brand playbooks.
What to watch
- Growth in premium smartphone, beauty and appliance sales in Tier II and III markets relative to metros.
- EMI share of transactions, consumer durable loan delinquencies and lender approval rates.
- Premium SKU mix and average selling price trends on Amazon, Flipkart, Nykaa, Tata Neu and quick-commerce platforms.
- Expansion of premium retail counters, brand stores and authorised service centres outside the top eight cities.
- Regional air-travel, hotel, beer and premium housing demand as cross-category indicators of discretionary spending.