In the heart of India's economic transformation, a quiet yet profound shift is taking place. Direct-to-Consumer (D2C) brands, once synonymous with urban millennials and metro dwellers, have redirected their gaze towards the country's tier 2 and tier 3 cities. This pivot isn't merely a matter of geographical expansion, but is a testament to the evolving consumer landscape in India.

For years, D2C brands were entrenched in urban markets, wooing digitally-savvy urbanites with their unique value propositions. Brands like SUGAR, Plum and Sirona which started as online-only entities, gained prominence in India's bustling metros. However, as they dug deeper into the Indian market, these brands encountered a growing consumer demand that was sweeping across smaller cities and towns.

“If you look at the data, the top eight cities account for only 35-38% of our D2C sales,” shared Shankar Prasad, Founder & CEO, Plum Goodness, in one of the interviews with exchange4media. For Plum, non-metro cities account for around 60% of its sales.

The story of Plum is not unique. Across the D2C spectrum, brands are experiencing a shift in consumer demand dynamics. Urban consumers, once considered the primary market, are now being supplemented, and in some cases, even surpassed, by consumers from tier 2 and tier 3 cities. These consumers are more price-conscious, value quality, and are increasingly turning to online shopping for convenience and accessibility, say experts.

A recent CyberMedia Research (CMR) survey highlighted that tier 2 and tier 3 cities are quickly catching up to tier 1 in terms of the amount of time spent on online shopping. Online shopping takes up about 16 per cent of consumers’ weekly income and takes up an average of 2 hours and 25 minutes per week in tier 2 and above cities.

Param Bhargava, Founder, T.A.C - The Ayurveda Company pointed out that the young buyers of tier 2 and tier 3 markets have become very aspirational. “The consumers there are looking for new brands and are ready to experiment with new brands,” he said.

This change in consumer behaviour was propelled by a lot of aspects, but majorly by the rise in disposable income and a consequent rise in purchasing power in these cities.

Experts say that it is a myth that purchasing power is concentrated in the metro cities. Bhargava mentions that the growth perceived for the Indian economy in the next 8-10 years, is majorly being driven by the consumption in tier 2, tier 3 and tier 4 markets.

Case in point - SUGAR’s story

The cosmetic brand has around 200 stores in the country as of today. In a chat with exchange4media, Kaushik Mukherjee, Co-Founder & COO, shared that the no.1 running store for the brand is not Mumbai or Delhi, but is Surat.

Explaining further, he said that consumers in non-metros are consuming the same content as the ones in metros, they are aspiring the same thing and getting influenced by the same western trends as the metros.

“The only thing that is then needed is access, which the internet solves for. You’ll notice that the basket size is pretty much similar in metros and non-metros,” Mukherjee shared.

Creating the right kind of content

However, in this digital era and the ever-evolving D2C landscape, one essential truth has become abundantly clear: content is king, and customization is the key. As these brands set their sights on the untapped consumer bases of tier 2 and tier 3 markets, the need to create precisely tailored content has emerged as a pivotal strategy.

Consumers in smaller cities and towns are increasingly turning to online platforms for their shopping needs, and thus crafting the right kind of content has become not just a marketing imperative but the bridge that connects brands with the aspirations of these consumers.

Fem-tech brand Sirona operates in a rather ‘hush-hush’ category, and aims to break the taboo around feminine and sexual hygiene. Vernacular content has played a big role for the brand to reach its consumers in the tier 2 and tier 3 markets and break the taboo, shared Deep Bajaj, Co-Founder, Sirona.

“One way to break a taboo is by talking about it, and we have been ardent believers in creating content around such topics in multiple languages and building awareness. When we track our orders, we see they are coming from all over. If there is awareness in the tier 2 and tier 3 markets, there is a willingness to try is what we noticed,” Bajaj mentioned.

Prasad echoes a similar opinion, that the role of vernacular content and influencers, plays a key role in relating to the consumers in non-metros. Even though these consumers might be able to speak and write English, that is not the language they think in. “Vernacular plays a key role in telling people things that they need to know, in the language that they think in,” he mentioned.