Indian consumers are increasingly shifting to private labels, with 52% preferring them and 70% recognizing improved quality, according to the EY Future Consumer Index. Trust in private labels is rising, supported by retailers’ expanded offerings and technology-enabled choices. Brand loyalty is declining as 59% buy branded products mainly on sale, prioritizing value and affordability. Innovation drives interest in categories like clothing and beauty. Additionally, 62% rely on AI for purchase decisions, with 58% reporting enhanced shopping experiences, challenging established brands to innovate and stay relevant.
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Indian consumers are increasingly reassessing their retail choices, with 52% now shifting towards private label products. According to the EY Future Consumer Index (FCI) – India edition, 70% of consumers believe that private labels are offering improved product quality. This shift is reshaping perceptions, positioning private labels as strong contenders to traditional branded goods.
The EY Future Consumer Index tracks changing consumer sentiment and behaviours across time horizons and global markets, identifying the new consumer segments that are emerging. The 15th edition of the EY Future Consumer Index surveyed over 1,000 consumers across India, from January 24, 2025, to February 20, 2025.
The trust in private labels is growing steadily, with 70% of consumers saying these products meet their needs just as well as established brands. While consumer preferences have historically changed with economic fluctuations, the current transformation appears more enduring.
The rise of private labels is also evident in the growing acceptance of new and emerging brands. This trend challenges established players to strengthen customer relationships and innovate to maintain relevance.
Retailers are responding by expanding private label lines and assigning them prime shelf positions. About 74% of consumers have noticed a broader range of private label options, and 70% have observed these products more prominently placed at eye level in stores. Moreover, 69% of consumers agree that private labels help them save money.
As per the report, Brand loyalty is taking a back seat to value and affordability. Nearly 59% of consumers report buying branded products only when they are on sale. However, 47% say they would consider returning to branded products if they deliver superior taste, quality, or performance, and 44% would switch back for better value for money. Another 44% of consumers are even willing to pay more for products that offer enhanced performance.
“Even when brands turn to innovation and ‘brand improvements’ such as changing ingredients or formulas to create more value, 34 per cent of respondents perceive these efforts as cost-cutting measures rather than genuine innovation,” the report noted.
Meanwhile, advancements in technology are empowering consumers with extensive choices and tools to compare products, stated Mr Angshuman Bhattacharya, Partner and National Leader, Consumer Products and Retail Sector, EY-Parthenon.
Innovation is driving consumer interest in specific categories. Clothing and footwear (58%), beauty and cosmetics (51%), and personal care (45%) are seen as the most innovative segments—thanks to their continued investment in research and development.
“At the same time, this presents established brands with both the opportunity and the imperative to deepen their connection with consumers and explore innovative ways to stay relevant,” Mr Bhattacharya noted.
The EY report also highlights AI as a major shopping aid, with 62% of consumers making purchases based on AI suggestions. Additionally, 58% say AI has greatly improved their shopping experience.
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