Industry Odisha Bureau, Sep 08: India spend is shifting toward its youngest consumers. Gen Z now shapes nearly half of urban India’s discretionary choices. That shift is forcing companies to rethink brand strategy fast.
India counts about 377 million Gen Z consumers today. They make up roughly 28% of the population. Yet this cohort already influences 43% of consumption spending. That influence totals close to $860 billion, per BCG and Snap Inc.
Most of that figure is not personal income. About $660 billion is influenced spending, where parents pay. Only $200 billion comes directly from Gen Z’s own earnings. That gap defines their spending power today.
Employment will change that balance sharply. Only a quarter of Gen Z currently works. That share could reach 36% by 2030. It may climb to 47% by 2035.
By then, direct spending could dominate entirely. BCG projects 93% of Gen Z spending will be self-earned. Total Gen Z spending could exceed $2 trillion. India’s overall consumption may reach $3.9 trillion by 2035.
Consumer behaviour already shows generational fingerprints. Roughly half of spending on footwear, dining and travel traces to Gen Z. The same holds for entertainment, OTT and fashion. Beauty trails slightly, at 44% Gen Z influence.
Investing habits are shifting too, though not exclusively among Gen Z. Investors under 30 grew from 22.6% to 38.9% since 2019. India’s median investor age fell from 38 to 33. Millennials and Gen Z together hold 48% of mutual fund assets.
Credit adoption tells a related story. Gen Z favours UPI, debit cards and Buy Now, Pay Later. They remain cautious toward traditional credit cards. Still, Gen Z formed 41% of new-to-credit borrowers in 2024.
Credgenics’ Rishabh Goel says credit often comes first now. “For a lot of Gen Z, credit isn’t the last step,” he said. He warns early habits, like high card use, compound later.
Design-led categories are adapting quickly. BlueStone’s revenue share rose from 17.7% to 24.6% by FY25. Lightweight, daily-wear jewellery is outpacing heavy bridal sets. Titan’s beYon brand now targets Gen Z with lab-grown diamonds.
Skincare shows a similar recalibration. Deloitte’s Anand Ramanathan says brands now emphasise verifiable formulation data. Some 74% of consumers check ingredient labels closely. Nearly 44% paid a premium for cleaner formulas recently, though most capped it near 10%.
BCG’s Kanika Sanghi says brands are reacting, not leading. “Brands are only responding” to shifting consumer behaviour, she said. Product and pricing playbooks follow demand, not the reverse.
Experts caution against crediting Gen Z alone. Ramanathan calls the generation “an accelerator,” not the sole driver. Urbanisation and rising household affluence remain equally important forces.
Ramanathan’s bigger worry is underestimation, not overestimation. Gen Z could form half of India’s online shoppers by 2030. That growth will spread beyond India’s metros, he said, shaped by wider choice and local pricing.
For now, brand strategy hinges on a single transition. Influenced spending still funds most Gen Z purchases. Independent income, arriving by 2035, will change the equation for good.
