Rooted in Identity: Consumers Powering the Rise of Indigenous Brands

India’s relationship with “localism” precedes its birth as a democratic republic. The Swadeshi movement (1905–1911) was launched to protest British occupation and promote the use of indigenous products. If one travels further back, they will find localism embedded in the country’s knowledge systems — such as Ayurveda and Unani medicine, a holistic approach to health and wellness based on herbal remedies.
 

This history helps explain why the urban Indian mindset’s current hunt for “local” isn’t surprising. It’s a continuation of a much older instinct.
 

Research conducted in 2022 by market intelligence agency Mintel showed that Indian consumers now prefer domestic brands over imported ones across several categories: clothing and accessories (42% vs 19%), personal care and packaged foods (45% vs 19% each), and beauty and cosmetic products (36% vs 23%). Consumers cited terms like “value for money,” “good quality,” and “healthy” to explain the switch.
 

While this change gained momentum after the pandemic, it has since become a sustained consumer behaviour shift.
 

In Local We Trust

A 2019 study published in the International Marketing Review showed that consumers often reject global brands when they perceive them as homogenised and disconnected from local culture. Brands that fail to resonate with cultural context risk being seen as inauthentic.
 

This aligns with the concept known as the COO (Country of Origin) effect, observed in a 2016 study. It found that “products and brands, which are identical in every aspect may be rated differently depending on their origin,“ while a 2015 study added yet another layer: Showing that consumer ethnocentrism increases preference for local over global brands, especially in countries with lower economic development and for lower-priced, less symbolic products. It concluded that local brands are often chosen not because they’re better in quality, but because they align with cultural identity and offer symbolic value.
 

This identity alignment is crucial. The same 2015 study found that the identity-signalling function of a brand — how well it reflects local cultural values — is more influential than perceived product quality in shaping consumer choices.
 

For example, homegrown drinks brand Paper Boat by Hector Beverages used nostalgia to capture market share in the Indian non-alcoholic beverages marketv. “What we truly liked ourselves was what is there in our history — the drinks which have been with us for centuries, where the recipes have been passed from one generation to another,” Paper Boat co-founder Neeraj Kakkar said in a Mint interview in 2016.
 

In 2012, a study in the Journal of International Marketing compared how consumers in Turkey, Singapore, and Denmark chose between local and global brands. It found that in emerging markets like Turkey, global brands could gain local appeal by embracing “local iconness.” However, in mature markets like Denmark or Singapore, global identity and local appeal were often at odds.
 

The study also found that Turkish consumers who considered food brands “locally iconic” also thought highly of its quality. However, this direct co-relation did not hold true for non-food items. Older consumers preferred local brands if they were prestigious. The study concluded that when consumers begin to see local brands as high-quality, their likelihood of choosing global brands diminishes.
 

These studies underline an important trend: cultural relevance, not just quality or prestige, is what drives loyalty toward local brands.
 

Pandemic Impact

A 2020 report by market research agency NielsenIQ showed that the COVID-19 pandemic triggered a major shift toward local brand consumption with 11% of global consumers surveyed saying they only bought products manufactured in their country while an additional 54% “mostly” bought local products. A further 19% of global consumers said they were always influenced to try or switch brands based on local attributes, with 34% more saying they were often influenced
 

One of the triggers for pandemic-induced focus on local brands could also be government intervention as seen in India, when the government announced the “Atmanirbhar Bharat” scheme (Self-reliant India), which pushed citizens to opt for local brands.
 

Under the scheme, the government introduced incentives for medium and small scale enterprises such as creation of an INR 500 billion fund to infuse equity in such businesses and drive their growth.
 

State-owned Khadi and Village Industries Commission showed 20.54% growth in sales in FY22 to INR 1.15 trillion compared with INR 957.42 billion in the previous year, which the Indian government’s press information bureau attributed to the Atmanirbhar schemes.
 

While the pandemic may have rung the opening bell, it was the geopolitical and economic shifts that embedded this inward-looking consumer behaviour. Supply chain disruptions, trade disputes, and concerns about self-reliance have pushed consumers and companies to double down on local options.
 

A 2024 report by Dutch asset manager Robeco noted that due to ongoing geopolitical pressures and rising supply chain risks, consumers are actively choosing local over global. “Local (and regional) brands now account for two in three (66%) of the brands placed in our shopping baskets, while global brands account for one in three (34%) brand choices,” the report observed.
 

Swiss consumer ingredients company Givaudan echoed this trend, reporting that in the first half of 2024, global fast-moving consumer goods (FMCG) companies saw only 4% volume growth. In contrast, local and regional companies registered a robust 12% growth.
 

Riding the local wave

Local brands are reaping the benefit of the consumer preference for homegrown brands. Non-alcoholic beverage producer Archian Foods that sells drinks under brands such as Lahori Zeera, Lahori Nimbu, etc, saw revenue growth of INR 3.16 billion in FY24 compared with INR 380 million in FY22, with the company expecting to hit INR 5.5 to INR 6 billion in revenue in FY25.
 

Archian’s founders attribute the brands’ popularity to indigenous flavours in a market that is “dominated by the colas of the world”.
 

Indian kitchenware and home storage market is set to grow at a CAGR of 15% by 2030 with consumers preferring local brands like “Air Lock” whose CEO attributed the growth to Indian consumer attitude of buying local. 
 

Chief executives of multiple homegrown brands report that Gen Z consumers are driving demand for local products, boosting their share of overall sales over the past three to four years, according to an October 2024 Economic Times articlexv.
 

Local brands accounted for 78% of total true wireless speaker sales in 2023, up from 48% in 2020, driven by increased purchases from Gen Z consumers, the article showed. The same report also says local brands beat global giants such as Apple, Samsung, Vivo, and Xiaomi and captured 95% of total smartwatch sales in 2023, up from 38% in 2020.
 

An October 2024 Deloitte report showed that 45% of Indian consumers now prefer purchasing local brands over global ones for food and beverage products In segments such as packaged foods, snacks, and beverages, local players are competing with larger incumbents by offering similar products at more affordable price points. 
 

The report also noted a surge in regionalised product development, with many F&B companies customising offerings to suit local taste preferences and cultural sensibilities. To strengthen their reach, brands have adopted customer-centric marketing strategies and launched advertising campaigns in regional languages to better engage rural and mass-market consumers.
 

Products like Gujarati snacks, South Indian spice mixes, and Bengali sweets in the packaged foods sector has gained popularity across the country, according to Deloitte, reflecting a growing consumer interest in authentic, region-specific local flavours. 
 

Even in fashion, Indian fashion e-commerce platforms are highlighting more homegrown brands, owing to consumer demand. 
 

Road Ahead

By and large, recent trends indicate that Indian consumers are drawn to locally produced and traditional food items. This shift has been fuelled by a growing appetite for regional flavours, organic produce, and artisanal offerings—spaces where local brands are well-positioned to thrive, according to the Deloitte 2024 report.
 

“The resurgence of local brands in India isn’t just a post-pandemic blip — it’s a cultural realignment,” said Sudhir Voleti, Associate Professor, Marketing at ISB. “What we’re seeing is Indian consumers rewriting the rules of brand aspiration: authenticity is now more desirable than ubiquity. Global brands that once symbolised modernity are being eclipsed by homegrown names that feel personal, rooted, and specifically Indian. Local brands today serve not just functional needs but act as identity markers in an economy shaped by nationalism and digital access.
 

Local brands are also striking when the iron is hot. Archian Foods raised INR 2 billion from Motilal Oswal as it looks to expand its business. Kolkata-based men apparel maker Kisah raised INR 130 million in an angel round of funding. Consumer goods conglomerate ITC bought 47.5% stake in healthy snacks local brand, Yoga Bar’s parent company Sproutlife Foods Private Limited (SFPL) and then gradually increase the stake to 100% over the next four years, the company announced in January this year.
 

These developments viewed in conjunction signal that localism is no longer a niche preference — it is becoming a foundational principle in how brands are built, scaled, and perceived in India. Investors are backing companies that understand regional nuances, reflect cultural identity, and offer differentiated value beyond price and quality. Whether it’s a heritage beverage brand, a men’s ethnic wear label, or a health-focused snack maker, the common thread is clear: Indian consumers are rewarding authenticity with loyalty, and the market is responding with capital.
 

Image Credits: Swarup Sarkar from Pexels