Titled "India's Changing Discretionary Spending: Key Insights for Brands," the report highlights India’s imminent rise as the world’s third-largest consumer market by 2026, primarily driven by a burgeoning middle class, increased discretionary spending, and rapid digital adoption.
India’s Middle Class and Digital Boom Driving Consumption
By 2030, the report estimates that Indians earning over $10,000 annually will nearly triple, from 60 million in 2024 to 165 million, reflecting a significant middle-class expansion. This shift is expected to fuel increased spending on premium products, digital services, and experience-led retail.Several key factors are accelerating India's consumption boom:
- Premiumization and Evolving Preferences: Consumers prioritize quality, convenience, and experiences over price.
- Gen Z and Millennials Leading the Shift: Accounting for 52% of the population, they are driving demand for premium brands, sustainable products, and hyper-personalized experiences.
- Expanding Digital Commerce & Financial Inclusion: Credit card penetration is expected to triple from 102 million in 2024 to 296 million by 2030, increasing access to credit and fueling consumer spending.
- Rise of Organised Retail & Omnichannel Shopping: Organised retail is witnessing 10% CAGR growth and is projected to hit $230 billion by 2030, with consumers gravitating towards experience-led retail spaces and digital-first consumption.
Businesses Must Align with Shifting Consumer Trends
Anand Ramanathan, Partner & Consumer Industry Leader at Deloitte India, noted that India's consumer landscape is fundamentally transforming, with rising discretionary spending and digital commerce reshaping engagement strategies."By 2030, India's per capita income is expected to exceed $4,000, creating unprecedented opportunities across sectors. Businesses must adapt by balancing affordability, convenience, and sustainability while leveraging data and technology for personalized experiences," Ramanathan added.
Echoing this sentiment, RAI CEO Kumar Rajagopalan emphasized that India's discretionary spending is entering a new growth phase due to rising incomes, digital adoption, and evolving consumer preferences.
"As organized retail and new commerce models expand, businesses that align with these trends will unlock immense opportunities for growth and innovation," Rajagopalan stated.
Digital and Fintech Solutions Reshaping Consumption Patterns
The report underscores how fintech solutions and digital payments, including UPI, transform consumer engagement, drive e-commerce adoption, and enable a digital-first consumption model.With India’s rising economic momentum, brands and retailers must rethink their strategies to cater to an increasingly digitally savvy, experience-driven, and premium-oriented consumer base.
As India solidifies its position as a global consumer powerhouse, companies that tap into these evolving trends will stand to gain a competitive edge in one of the world’s fastest-growing markets.
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