Key Points
Urban markets have been the drivers of growth with modern trade and ecommerce leading the way as consumers at the lower end hesitated to spend while the affluent splurged on premium goods..
Rural India, which accounts for nearly 40% of the overall market of fast moving consumer goods (FMCG), saw a noticeable drop in demand for a year due to inflation and erratic monsoons..
While volume growth for the FMCG industry in urban India had been on a positive trajectory since April-June 2022, rural markets grew marginally in 2023, according to market researcher NielsenIQ..
In addition, the premiumisation trend is also likely to strengthen.. Upcoming general elections and further reduction in inflation will help revive consumer demand across categories from grocery to apparel to electronics from March-April onwards, with rural markets and mass-segment products already showing signs of recovery, chief executives of several leading companies have told ET recently..
As small towns rise on India's consumption map, companies can expect more consumers shopping online especially for premium products since the hinterland has been underserved by traditional retail in categories such as apparel, electronics and jewellery..
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