Starbucks smells the coffee

Price-sensitive consumers, high rentals prompt shift away from premiumisation

- VIVEAT SUSAN PINTO

PREMIUMISATION MAY BE the preferred go-to-market strategy for many consumer companies in India, as rising aspirations and higher disposable incomes fuel growth at the top end. But a growing set of retailers is taking the reverse route-shifting from premium to mass-as the need to expand and adapt to local market realities forces a rethink. Brands such as Skechers, Domino's, Decathlon and Starbucks are among those recalibrating their strategies, industry experts told FE.

Tata Group-run Starbucks is the latest global brand to explore a lower-cost operating model in India, seeking to address the price-sensitive yet aspirational consumers, high rentals and uneven demand trends.