(IANS) India is the only market to consistently deliver double-digit growth in the Asia-Pacific region in the FMCG, technology and consumer durables segments, according to a report by consumer research firm NielsenIQ (NIQ) released on Wednesday.

NielsenIQ (NIQ) has released a report titled ‘Growing Value – Navigating Premiumization Trends in India’, highlighting the importance of premium brands in the fast-moving consumer goods (FMCG) and technology and durables industries. The report indicates that premium FMCG brands are growing at twice the rate of non-premium brands. A similar trend is seen in the technology and consumer durables sector, driven by rising incomes, urbanization, smartphone penetration and a more aspirational consumer base. the bigger players in the industry. Roosevelt Dsouza, India Commercial Director at NielsenIQ, said: “We are seeing a growing convergence of aspirational consumer preferences with higher disposable incomes and presence and access to premium products. This shift is driven by digital platforms, contributing to almost half of sales, channel diversity and new entrants will further drive premiumization adoption in the future.” Digital platforms contribute significantly to premium brand sales Trade channels are growing twice as fast as traditional channels, with metropolitan cities contributing significantly to tier 1 and 2, being the fastest growing markets, reflecting rising aspirations and a more high availability of premium brands, organized retail channels and metropolitan cities are leading premiumisation, although growth is accelerating in all regions.

The technology and consumer durables industries are also experiencing these changes. Products with premium features are growing by 50% as consumers increasingly seek items that promise convenience and improved quality of life. According to the NIQ Consumer Life Study, 41% of urban Indian consumers are now willing to pay more for technology products that make their lives easier.

The report notes that FMCG premium growth is more organic than price-driven. The volume of consumption is growing at almost twice the rate of price growth, reflecting a shift to higher quality products. Home care and processed foods have seen significant growth, with consumers preferring premium brands in these categories. Health and wellness-focused products are also gaining traction, particularly in personal care and home care. The South has the highest proportion of premium brand sales, while the West and East are growing the fastest.

According to the NIQ Mid-Year Consumer Outlook report, over 70% of urban Indian consumers are willing to pay a premium for products that last longer. Indian consumers are prioritizing spending more on home experiences to save on outdoor dining and entertainment expenses.

Luxury FMCG brands are the fastest growing category, with brands priced at more than twice the category average seeing remarkable success. Despite the broader challenges India’s FMCG industry faces in achieving double-digit growth, the premium segment has consistently achieved double-digit growth across all markets and categories, accounting for half of incremental sales. This trend is particularly visible in the southern and western areas.

Modern commerce has become crucial for the launch of luxury products, especially for small and medium-sized manufacturers, who are outpacing the bigger players in this space. In traditional trade, larger FMCG companies continue to dominate in terms of market penetration, although mid-sized players maintain a stronger position in the luxury segment. NIQ indicates that modern trade is vital in introducing premium and luxury products to Indian consumers. Of all new product launches in modern trade, 58% are in the premium+ segment, compared to 38% in traditional trade. Thus, medium and small producers in modern trade experience faster growth than larger, more established companies.

Indian consumers are increasingly prioritizing health and wellness in their purchasing decisions, especially in the home and personal care sectors. Demand for premium, natural and chemical-free products with active ingredients and proven benefits is driving premium growth in these categories. Healthier options are also driving premiumization in food products.

India’s economy is growing rapidly, marked by a large working-age population, rising per capita income, increasing smartphone penetration and urbanization. Manufacturers need to focus on premiumization as a key growth driver in the FMCG sector.

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