Why Consumer Brands Are Hot?

Consumer product based businesses are not a new phenomenon but it has truly come of age. When we thought of the biggest trend that will rule the coming year, we found everyone excited about consumer product start-ups.

- Punita Sabharwal

When we talk about start-ups, a Paytm or Flipkart will find a mention before Hector Beverages (makers of Paperboat) or Sula Wines. Brands which are truly making the international market sit up and take notice. Tech start-ups have their own charm with high level valuation. On the other hand, product based businesses are looked upon as investment heavy options as huge amount of money goes into product development, sample production, marketing and sales efforts. Moreover, finding capital for production and distribution is never easy.

But going by the global trend, the consumer habits of the millennial is changing pretty rapidly. They find big brands boring and constantly explore the new. This behavior has given birth to several tangible products which make the world look at India. These companies don’t play on tech to be disruptive; they focus on building innovative products.

Whether it is Raw Pressery giving us cold pressed juices or an Epigamia introducing Indians to yogurt being looked as a snack, new-age concepts like men’s personal grooming or organic babycare products – these start-ups are giving tough competition to the biggest FMCG players.

With transparent ingredients and smart packaging, these start-ups are better positioned than their established but conservative counterparts. The future will further see M&As in this space, as start-ups tend to eat into established players’ market share.

Today, Indian consumers are willing to pay a premium price for healthier products. And investing on this trend, VC funding on consumer companies has shot up significantly this year. The year 2018 and beyond look even healthier with money flowing from tech to non-tech or the consumer space.