Trends impacting Consumer Life in Tier II & III India

28 Dec,2022



By Sanjeev Kotnala


Sanjeev KotnalaThe changes in the market and ecosystem are led primarily by brands and companies providing new or better products or services to the changing consumer needs, desires and wants. Or when the brands try to satisfy an unsaid, unfelt need that they believe exists. External factors like a pandemic, economic situation, inflation etc., dully impress and affect these changes as they affect the consumer reaction and expectations. We typically see such changes from the company/ brands/ category and technology point of view. However, there is another way to see it. Here are some of the ways consumers in Tier II and II see life changing.


The Case of Shrinking Packs

The quantity of products in packs has been shrinking to keep the per-unit cost under control. It has shrunk to a level where the consumer experience is affected. For example, you need three packs of new Maggi to serve two. Soon brands will have no margin to shrink the pack further. The consumer, on the other side, wants single serve/use packs to be more than sufficient for a single serve or use.


Comfortable with E-commerce

The average consumer may still not be comfortable ordering shoes online; there is high overall comfort with e-commerce. Ease and speed of delivery and the option to exchange or return have enhanced consumer confidence in e-commerce. The range of products bought through e-commerce is ever-expanding. However, the neighbourhood kirana or medicine shop is still the answer for day-to-day needs and purchases.


UPI-simplified E-payments

Consumers have taken to e-payments with UPI and wallets like fish to water, surprising many naysayers. It has opened the way for e-currency, transparency and ease in transactions and has impacted the use and abuse of credit cards.


Consumers are more Phishing and Fraud Aware

The collective efforts of banks and regulators have worked. Typical Tier-II and III consumers are better aware of scams and phishing. The number and incidence may seem to be on the rise as more consumers are confident and comfortable reporting their folly and stupidity while successfully retrieving scammed money. However, fraudsters are keeping ahead with new versions and innovative scamming.


Comfort with Changes

The consumer is open to new ways of living. They are comfortable working from home, online education, and even buying insurance. They are open to a broader set of career choices. There is reduced pressure on ‘what neighbours and relatives will say’. There is a far greater sense of confidence and individuality in decision-making.


Life Uncertainties are Better Accepted.

Consumers accept the uncertainty of life. Their comfort levels have shaken with the earlier benchmark. The financial implications of lack of job security, deaths, and medical costs have shaken their comfort levels. They are extra cautious and willing to invest more for future emergencies.


They are No Longer Buying.

Consumer understands the range of choices before them. They understand the sale trap and the no-cost EMI effect. They understand brands are chasing limited demand. They are no longer buying things but selling their money, time and engagement.

Democratic digital information access has transformed their attitude. They are no longer willing to live with below-average service and product quality, and they are cautious and sure about How much they will pay for a service. Also, the costlier equals quality equation is no longer considered sacrosanct.


Women have Focus and Rights!

There is still a long way to go. However, women in families and daughters, in particular, have it a lot better now. Families collectively look for and encourage their education, life, dreams and aspirations. The need for financial independence for a better future is fully understood and endorsed. Domestic violence is no longer taken for granted. Divorce is still a bad word but losing is slowly losing the stigma attached to it.


Food Ordering is on the Rise.

Eating out may not be that prevalent, but ordering in is becoming a regular practice. Families, where the kitchen is closed at least one day of the week ( and mostly fixed day) are on the rise. The consumer continues to complain about packaging and delivery charges but willingly orders more than what is needed.


Search has the answer to everything

The consumer is searching on the internet for everything possible. Be it medical conditions, electronics, insurance, investments, doctors, vacation, education and more. There is additional pressure on brands and companies to find a differential – a reason for preference in the era of pre-searched information. Additionally, consumers have their algorithm for what and when to believe the reviews that are an integral part of the search process.


Facebook is Dead

Engagement across social media platforms is rapidly changing. The ever-flirty consumer is comfortable shifting loyalties to a new platform that works for them. Metaverse is a good possibility, and the brands are trying to explore and capitalise on it- however, the traction may take a bit longer to build up in Tier II and III.


Data Privacy

The consumer continues to sign permission for the apps blindly. They hope the regulatory system and active users’ collective scrutiny will ensure everything is correct. However, they are rightly cagey about their financial and banking data. Frequent data breaches are making the lack of data privacy more acceptable. The consumer reacts to data breach just like they react to wearing a helmet, with a denial, ‘It will not happen to me’ attitude. The data protection rules and norms are not sufficient but are evolving with time.


Short Format is King

The shorter attention span issue is a reality. Communication is becoming shorter and shorter across videos, reels, blogs and articles, stories, and films are on the rise. The consumer is interested in consuming a wider variety of content than devoting time to one content. Having said that, if the content is right, differentiated, suitable, relevant and exciting, the consumer will give it the time and required engagement.


Celebrities and Influencers Still Work!

Consumers have started reading between the lines and questioning celebrity endorsement and influencers. Though the section of the gullible consumer is decreasing, a large section still gets taken by the use of celebrities in advertisements. So, at least in the near future, the practice of celebrities and influencers will continue, leading to lesser impact and return. We will see a rise in Micro-influencer influence. Don’t be surprised if regionalisation and religionism start influencing the choice of influencers.


Traditional Media is Not Yet Dead

Yes, digital interaction for the average consumer is on the rise. Fast-forwarding and skipping advertisements is a habit. And most users engage in other activities during pre-rolls or unskippable promotions. Business communication over Print- Radio, and Television is still influential in tier-II and III towns. It may work better if the brand or the company is willing to make extra efforts to work with the media. In tier-II and II towns, ignore traditional media at your own risk.


Overload of Affordable Entertainment

With the availability of the internet at very affordable prices coupled with low cost of channels and OTT platforms and free content across platforms, the Indian consumer is spoiled for choices. Movies need to look at the cost of experience and content to continue attracting viewers,


Boycott is losing its Sting

The average consumer is not much affected by the call for boycotting brands, products, and services, including movies. Even the people on social media who have overused this tool of protest themselves reach out to experience things to see and evaluate if the call for boycotting was valid. Life still has far more important priorities than following the boycott.


Religionalism and Regionalism is on the Rise

It is an old problem that never dies. The polarity is far starker and divided. No longer are consumers warry about showing and defending their religion and region. Everyone is insecure and believes it is their duty and responsibility to protect their beliefs and not tolerate a different POV.



The average consumer in Tier-II and III towns is far more aware and inquisitive than what is credited to them. The brands and services must understand the needs to address them differently. One can today experience the statement – ‘Change is the only constant’, which places more pressure and the need for the business to be agile, insightful and proactive.


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