India’s overall buying intent softened for the third consecutive month in September, with FMCG emerging as one of the categories under pressure. Buying intent for FMCG fell 11.9% during the month and stood 26% below September 2025. But, this may not be a story of consumers walking away from consumption altogether. The pressure on FMCG is coming from several directions at once. But at the centre of the buying-intent decline is a bigger question: what is creating this hesitation? Is it price, changing priorities or simply a more cautious approach to everyday spending? Let’s decode what is making the basket harder to win.
The Consumer Got Selective
“For the price-sensitive consumer a progressive rise in some of the essential commodities have played a role in some of the segments. Some are reducing the quantity and frequency of consumption. Some are shifting to smaller SKUs and switching to cheaper products,” says Arijit Ray, Founder, The Unlock Company. The pressure, however, is not coming from one direction. Ray also points to declining disposable income, saturation and fatigue in urban markets. At the same time, consumers have more alternatives to choose from, with private labels and well-packaged D2C brands competing for the same wallet.
That makes the FMCG question more interesting. Is consumption actually falling, or is the consumer simply becoming more selective about where the money goes?
Darshana Shah, Brand & CX Strategist and Founder, Darshana Shah – Advisory & Consulting; Former Group CMO, Aditya Birla Group, sees it as the latter. “The decline reflects a consumer who is becoming far more deliberate about spending. Inflationary pressures, uneven income growth and continued caution around discretionary purchases are encouraging consumers to prioritise essentials, defer non-essential purchases and actively seek value.” The implication is subtle but important. A consumer does not necessarily have to stop buying to put pressure on a category. Buying a smaller pack, delaying a purchase or choosing another brand can have the same effect on buying intent.
The Monsoon Effect
Rural demand adds another complication. According to Ray, rural India now accounts for 36% of FMCG consumption, making farm incomes an important piece of the demand picture. And with nearly 313 districts receiving deficient or large-deficient rainfall, the impact is unlikely to be evenly spread. “Food, healthcare and education typically hold up better when farm incomes weaken, while products linked to grooming, celebration or premiumisation tend to face slower offtake,” Ray says. Southern India, eastern India and other rain-fed pockets that faced sharper deficits could therefore see weaker demand than better-watered regions.
But it would be too easy to pin the entire FMCG decline on rural stress. TRA’s index measures urban consumers too, and Shreya Badola, Brand consultant and former marketer and communication specialist with Colgate-Palmolive, Minimalist and McDonald’s, points to another factor in the year-on-year comparison, “The year-on-year fall in FMCG Buying Intent looks alarming, but a good part of it is probably a tough base and calendar comparison. Last September saw GST cuts on categories such as soap, shampoo and toothpaste alongside an earlier festive start. Beyond that, there is real pressure from higher prices, lighter packs and elevated food inflation.”
So, while the monsoon may determine how some rural markets behave in the months ahead, the consumer’s caution is not confined to the countryside.
The Desire Gap
This is where the FMCG story got more interesting. Consumers still know and trust a lot of brands. But familiarity doesn’t automatically translate into a purchase. “The most interesting signal is that ‘Desire’ has dropped more than ‘Trust’. People still believe in these brands. They just don't feel much pull towards them,” says Badola. Habit has long been one of the category’s strongest assets. But when consumers begin questioning whether they need a product, how much they need and whether another option offers better value, the habit has to work harder. “Price changes and smaller packs help keep products affordable, but they won't make anyone want them more. That's where communication comes in. Brands in everyday categories need to talk about the problem they solve, not rely on habit to do the selling,” Badola adds.
The FMCG Countermove
The response from large FMCG players is coming from both ends of the market. At the mass end, brands are using smaller SKUs and sharper price points to protect volumes. At the premium end, they are moving into areas such as health, wellness, millet, bajra and organic products, where D2C brands have built strong consumer interest. Ray points to ITC, HUL and Marico acquiring D2C brands as part of this response.
Distribution is also a competitive weapon. Legacy players are putting significant capital behind quick-commerce platforms while using their supply-chain strength to maintain availability online and offline. “By dominating the first few digital tiles of daily essential apps, they capture high-intent, immediate-need purchases,” Ray says.
But the bigger task is balancing affordability with value. Shah adds, “Brands need to respond with sharper value propositions rather than relying purely on promotions.” The right price-pack architecture, tangible product benefits, stronger distribution and better use of consumer data matter. So does giving people a reason to choose one brand over another.
FMCG is under pressure; digital is surging
There is a striking contrast in the same index. Digital Buying Intent rose 8.6% in September and was 65.3% higher than September 2025, with digital-led brands and services such as Zomato and CRED among the notable gainers. “Consumers are rewarding propositions that make everyday decisions faster, easier or more useful. This is less about online replacing offline and more about where choice is now being shaped — increasingly by platforms, convenience and the ease of discovery,” Badola states.
Shah sees the same movement as a change in how consumers discover, evaluate and transact. Digital platforms offer convenience, comparison, choice and personalised experiences, making them particularly relevant to a consumer who is already scrutinising every purchase.
Ashish Bajaj, Founder, 10on10 Foods, comments, “The September 2026 TRA Index drop (98.2), driven by seasonal rural pressures and an erratic monsoon, signals an uneven consumption landscape rather than a total demand collapse. While traditional FMCG intent contracts, broader market data confirms consumers are prioritizing value over habit. For digital first brands this is a huge opportunity.” Ray sees quick commerce as another expression of this demand for immediacy. “The convenience of instant gratification, the urgency of having it & needing it NOW, dictates the mode of consumption,” he adds.
The FMCG consumer is still spending. But who wins the next purchase will depend on which brands can turn changing consumer priorities into a sharper value proposition, stronger relevance and a reason to be chosen beyond habit.
