How brands are rethinking mktg as metro-income professionals move to Tier II & III cities

India's next wave of consumption may not be emerging overnight, but marketers are increasingly factoring it into their long-term growth strategies. As better infrastructure, hybrid work, improving digital connectivity and changing lifestyle preferences encourage a steady movement of professionals with metro-level incomes to Tier II and Tier III cities, brands are beginning to reassess where future demand will come from.

Rather than chasing population growth alone, marketers are tracking the emergence of affluent consumers outside the metros, who bring higher purchasing power but retain strong regional preferences, prompting a rethink of media investments, localisation and premium positioning.

Recent hiring trends reinforce this shift, with job openings in Tier II cities growing nearly 42% year-on-year, compared with 19% in Tier I cities, according to the Randstad Talent Insights Report 2025.

While still at an early stage, the trend is prompting brands across housing, banking, consumer electronics, OTT and home improvement to adapt their marketing playbooks. Instead of viewing smaller cities primarily as value-conscious markets, marketers are increasingly recognising pockets of premium demand fuelled by consumers who earn metropolitan salaries but choose to live outside India's largest cities.

Read On: Beyond Metros: Are Tier 2 & 3 markets truly powering India’s CTV boom?

Pratik Kamdar, Co-Founder and CEO, Neuron Energy, said the company is seeing increasing demand from Tier II and III cities, where consumers are seeking reliable, high-quality mobility solutions rather than just low-cost alternatives. In response, Neuron Energy has strengthened its trust-led positioning around product quality, safety and performance, while expanding regional marketing, digital outreach, dealer partnerships and its distribution network to support growing EV adoption beyond metros.

"Our communication is also becoming more market-specific. Instead of a one-size-fits-all approach, we focus on educating consumers and businesses about battery safety, lifecycle, performance, service reliability and total cost of ownership. These topics matter strongly in Tier II and Tier III markets, where trust and long-term value play a major role in purchase decisions," Kamdar said.

Consumer-facing brands say they are already seeing early signs of this shift reflected in demand patterns, prompting changes in product portfolios, distribution strategies and marketing investments.

Tushar Gupta, Director of Operations, Thermocool Home Appliances Ltd, said the company is seeing a steady rise in demand from metro-income consumers in Tier II and III cities, driven by hybrid work and evolving lifestyle preferences. In response, Thermocool has expanded its portfolio of smart, energy-efficient appliances while strengthening regional digital campaigns, OTT advertising, transit media and influencer-led marketing to reach these consumers.

"We at Thermocool have widened our reach to important Tier II and Tier III locations through enhanced omnichannel connectivity via e-commerce and quick commerce channels. Our communication approach has also evolved to include a blend of regional storytelling and aspirational branding messages in tune with changing consumer preferences," Gupta said, adding that backed by investments in manufacturing and product development, the company is focused on offering efficient, high-quality appliances tailored to the needs of value-conscious consumers.

Read On: How tier 2 and tier 3 India are redefining brand growth

The opportunity aligns with a broader premiumisation trend identified in the Indus Valley Annual Report 2025, which notes that India's top 10% of consumers, around 140 million people, account for a disproportionate share of discretionary spending, while premium housing, higher-end smartphones and executive motorcycles have continued to outperform mass segments.

The response is beginning to take shape across sectors. Real estate developers are targeting professionals seeking larger homes and a better quality of life outside congested metros, banks are expanding premium banking and wealth management offerings beyond traditional urban centres, consumer electronics companies are focusing on premium appliances and connected devices, OTT platforms continue to deepen investments in regional content and local-language acquisition, while home improvement brands are preparing for rising home ownership and renovation demand in emerging cities.

For marketers, the question is becoming less about whether Tier II and Tier III markets matter, and more about how quickly this emerging consumer segment reaches sufficient scale to warrant dedicated media budgets, localised creative strategies and premium brand positioning.

Pranay Punjabi, Founder and CEO, XECH Technologies, said the company is closely tracking the shift of metro-income professionals to Tier II and III cities, driven by remote work, improving connectivity and rising living costs in metros. He noted that relocating to smaller cities allows consumers to enjoy a better quality of life while increasing their disposable income, creating new opportunities for premium consumer brands.

Punjabi said, "What is interesting is that their aspirations have not changed. They still want products that are smart, premium, beautifully designed, and offer a great overall experience. In many cases, the money they save on housing and daily living gives them greater spending power for lifestyle, technology, and home improvement products."

He added that the trend has reinforced XECH's focus on expanding beyond metros through new Experience Centres, a stronger omnichannel presence and wider distribution. The company is also investing in regional content and creator partnerships, noting that consumers in Tier II and III cities are as digitally connected and brand-aware as their metro counterparts. According to him, the next phase of growth for premium consumer electronics is likely to come from these markets, making early investments in localised engagement critical.

The trend is extending beyond home appliances and consumer electronics into newer sectors as well.

Read On: Will tier-2 cities redefine where India's best ads are made?

Broader perspective

While brands are adapting their product and distribution strategies, agencies believe the bigger transformation lies in how marketers approach media planning, creative strategy and consumer engagement. They argue that localisation is increasingly becoming a core growth strategy rather than a tactical exercise.

Shradha Agarwal, Co-founder and Global CEO, Grapes Worldwide, said brands are gradually moving beyond viewing metros as the sole centres of aspiration, as many consumers in Tier II and III cities now have comparable purchasing power and a growing appetite for premium products and experiences. As a result, these markets are increasingly becoming a core part of brands' long-term growth strategies rather than just the next frontier for expansion.

Agarwal explained, "This is also changing how brands plan their campaigns. Brands are realising that what works in metro cities won't always work in Tier II and Tier III markets. That's why they're investing more in local insights, regional languages, and creators who already have the trust of these audiences. Digital has simply made it easier to find and engage consumers with the right message."

She added that while price remains important, consumers in Tier II and III cities are increasingly prioritising quality and value over the lowest cost, making them more willing to pay for products they perceive as worthwhile. She believes categories such as consumer electronics, automobiles, home improvement, financial services, travel, wellness, beauty and premium everyday essentials are well positioned to benefit, adding that premiumisation today is defined more by value and consistent brand experience than by price alone.

Read On: Non-metros drive premiumisation, attract up to 35% of brand spends

Echoing this view, Jyoti Chugh Bhatia, Group Director, Gozoop Creative, said the shift has been building over time as consumers in Tier II and III cities become more affluent, digitally connected and aspirational. She noted that brands are responding by moving away from one-size-fits-all campaigns and investing more in regional content, local creators and culturally relevant messaging to build deeper consumer connections beyond metros.

She added that consumers are increasingly making purchase decisions based on aspiration rather than geography, with premium brands that offer genuine value and relevant messaging finding greater acceptance across Tier II and III markets.

"We're already seeing this across categories like smartphones, automobiles, beauty, fashion, travel, financial services, and premium food and beverages. The opportunity for brands is to stay aspirational while making their communication feel authentic and relevant to local audiences," Bhatia concluded.

While the migration of metro-income professionals to smaller cities is still unfolding, marketers agree that the shift is becoming increasingly difficult to ignore. As purchasing power gradually spreads beyond India's largest urban centres, brands are balancing national strategies with regional relevance, betting that the next phase of premium consumption will be driven not just by metros, but by aspirational consumers across emerging cities.