Rural India’s FMCG basket expands as digital push, income growth reshape spending: Kantar-GroupM Rural Barometer 2024

The average number of fast-moving consumer goods (FMCG) products in the basket of rural households has risen from 5.88 in 2022 to 9.3 in 2024, said the fifth edition of the Rural Barometer by Kantar and GroupM. That signals growing aspirations and spending power among rural consumers, who are now more connected and exposed to modern consumption patterns than ever before.

Income diversity adds financial stability


While the report does find stress among rural households, it draws a sharp contrast between those dependent solely on agricultural income and families with multiple income sources. While 82% of single-income households report financial stress, this drops for families with diversified earnings to 70%.

“Income diversification and direct benefit transfers are helping rural households ease financial stress, allowing them to spend on aspirational products," said Puneet Awasthi, director-specialist businesses, Insights Division, Kantar.

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Ajay Mehta, managing director, GroupM OOH Solutions, had a broader takeaway. “The conventional way of looking at rural audiences will do a disservice to your product, he said. “Rural consumers are evolving quickly, and brands need to adapt their sales and communication strategies to keep up. You can’t apply old urban-rural thinking anymore—you need to evolve."

Rural turns to digital


Digital adoption is reshaping the way rural India consumes media and spends money. Nearly half of rural consumers now use a mix of traditional and digital media. Digital payments are also on the rise, with 42% of rural internet users now using these services.

Interestingly, states like Bihar and Odisha—often seen as lagging in digital infrastructure—are leading the charge in digital payments adoption. “These regions, which send a large share of India’s migrant labour, have transitioned from money orders to digital remittances. It’s a major behavioural shift," Awasthi said.

However, Mehta clarified that this doesn’t mean traditional media is losing relevance. “It’s not about choosing digital over traditional. Both have a role to play. The media mix is evolving, and marketers need to find the right balance," he said.

Convenience products lead the charge


Rural consumption is also being shaped by growing demand for convenience products like ready-to-eat snacks, beverages, and cleaning supplies. Improved infrastructure—better electrification, modern kitchens, and connectivity—has played a big role in this shift.

“These lifestyle upgrades create a natural demand for modern products, and once people start using them, it’s hard to go back," said Awasthi. Mehta agreed, adding, “Consumerism, once established, tends to sustain unless there’s a major disruption."

Rural demand revives


The findings are supported by commentary from leading FMCG companies during their July-September earnings calls. Hindustan Unilever (HUL) reported 3% underlying volume growth, citing improving rural demand. Dabur India reported rural sales growing at twice the pace of urban markets, a welcome rebound after several slow quarters.

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Marico, too, said rural volume growth outpaced urban demand for the third straight quarter, while Nestlé India acknowledged the growing importance of rural markets in its strategy. These signals underline the growing opportunities for companies tapping into rural India.

Balancing short- and long-term goals


As brands rush to tap into rural markets, Awasthi cautioned against a short-term view. “Balancing immediate returns with long-term brand building is crucial. Without a solid foundation, you’re just buying market share instead of winning it," he said.

Mehta had a clear message for brands: “Rural consumers are no longer just following trends—they’re shaping them. If you don’t adapt, you risk falling behind."