How to Build a Successful Consumer Brand in India?

Fireside Ventures (a consumer focussed fund) closed their second fund worth $118 Million three days ago. This comes at a time when people in India (my parents included) are willing to try out new products and give challenger brands a try. As India’s retail market evolves, modern trade (likes of LeMarche) is set to account for 15% (from 8%) of the overall distribution whereas online retail is expected to account for 5% (currently at ~ 3%). A few questions that I had in mind while observing this upsurge were why now? What has changed? Why is it so easy to start a consumer brand? I read a number of reports and spoke to 60+ founders in my quest to find the answers. This blog post is to detail out my findings :

1.Rise of the ‘Millennials’

India will have 500M+ millennial consumers (age 22-37) by 2021 with a total consumption expenditure of $350B+. Millennials bring strong brand affinity, seek instant gratification, are not averse to change and are risk takers while purchasing. They want new experiences, a sense of individualism and nonconformity. They spend an average of 17 hours per week online across various mediums. Majority of millenials are first time employees and are more financially independent than their predecessor generation. With significant shift towards millennials, the consumer brand landscape is expected to change in favour of new-age challenger brands.

2.Rising Aspirations

As millennials do not wish to commit and own things, they are spending the residual income to try out newer brands, seek new experiences. The desire to get that ’like’, ‘comment’ on Facebook, Instagram and be amongst the early adopters is one of the strongest driving forces behind this behaviour. ‘Access trumps ownership’ - this seems to be the motto of millennials and Gen - Z.

3.Distribution Channels

Channels such as e-commerce, modern trade, assisted commerce, direct-to-consumer are providing more power to the consumers who are now able to access goods & services from remote locations. With a reach of more than 19,000 pincodes in India, most large consumer brands have adopted online distribution. I remember speaking to an ambitious founder who is currently running 100+ Cr apparel business along with his wife and most of their sales come from E - commerce platforms.

4.Ease of Getting the Product Manufactured

While building the sectoral thesis, I was so fascinated by the concept of building brands that I strongly considered building one on my own in the footwear category. One of my friends is a huge fan of Vibram Furoshiki shoes and we both wanted to make more people try it out. Upon locking the concept, finding contract manufacturers who could build the product out was extremely easy. Indiamart was the answer! It has a huge database of manufacturers who can manufacture the product based on your specifications. The hardest part was negotiating for MOQs as most manufacturers were looking at 10,000 units as the first lot size and this required a significant upfront investment :(

Looking back, I’m glad that we did not decide to go forward and didn’t give into our naivety as we were not aware about certain challenges within this segment. You can read more about them here.

5.Building a Brand Story

Out of all the vanilla parameters, one that stood out in majority of the brands was their story. Brands such as Tailor and Circus and Sleepy Owl have done a phenomenal job at building a story around their products. They have a story that they communicate to their fans and make sure that they stick to it across all communication channels. How do they communicate these stories? Social Media! Nobody could have imagined getting such a loyal following and quantifying it a decade ago. But because of the adoption of social media platforms (especially Instagram), the new age brands have arrived!

Brand Categories

1.Fashion and Apparel

Three most important things that customers prefer while selecting any apparel product are :

  • Style/ Design
  • Quality of the material used
  • Fit

2.Food and Beverage

Taste remains to be the strongest differentiator when it comes to customer preference within the F&B category. No matter how well packaged your product is and who endorses the product, if it tastes bad, the expectation to have your customer buy the product again is unfair. Some of the categories that are currently being disrupted are :

  1. Healthy Snacking
  2. Babyfood (Brand sensitivity being one of the biggest challenges as one instance of a bad press can ruin the brand image)
  3. Pet food
  4. Time/Convenience as a value proposition. e.g. Instant coffee mix

3.Personal Care

I do not have a strong thesis for this sector, but if you are looking to start your own brand within this category, you may refer to this link. One category that has seen quite an upsurge is men’s grooming. Companies such as The Man Company and Ustraa have become the “poster brands” of Indian personal care space. With that being said, dental care still remains to be an ignored category and has seen no disruption since years.

Challenges and Opportunities for Disruption

1.High MOQs

As most manufacturers ask for MOQs of about 5,000 - 10,000 units, testing the product out without raising/investing a significant capital still remains the biggest challenge for building a consumer brand in India. There will be a proliferation in the number of brands coming out of India if the founders are able to create an MVP as easily as running an experiment online.

2.Unorganised Distribution

Because modern trade contributes a significantly lower % of the overall retail, distribution remains the toughest task that lies ahead of any founder venturing out in the consumer segment. It takes ~ 2 years to ensure that your product reaches the popular outlets (modern and general trade) of major cities in India. Setting up distribution also requires you to pay upfront costs to the Modern Trade outlets and it is in general a very capital intensive game. While it is convenient to use jargons such as ‘D2C’ or ‘online brand building’, the true value cannot be unlocked without streamlining distribution.

3.Data and Personalisation

While most brands do take customer feedback during the product development process, they have no way to identify the end consumer (for offline segment) and hence, can’t personalise the product as per the user needs. As of today, Pepsi doesn’t know the details of the customers who opened the cap of its bottle. Imagine if Pepsi/Coke could know this and offer a personalised drink as per your needs that you could order from its website. This is where the true disruption lies according to me!

Personal Take

Unless the time to distribution and personalisation is solved (as mentioned in the challenges above), I do not intend to venture out in the consumer brand category.


  1. Kalaari Capital’s report : T20 consumerism. I contributed to this report and you can buy it on this link
  2. The New Indian : One of the best reports I’ve read till date : Link
  3. Reimagining FMCG in India : Link


  1. Founders of all the brands who took the time out to speak with me

  2. My colleagues and mentors at Kalaari

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