The localisation bet — why regional flavours are no longer a niche play in beverages

There is a particular kind of confidence that comes from a flavour consumers already know. For years, India's beverage industry largely borrowed global formats, imported taste profiles and relied on marketing to cultivate demand. That equation is beginning to reverse. Today, some of the fastest-growing beverage categories are not introducing consumers to unfamiliar tastes but rediscovering flavours that have long existed in local food cultures.

The shift goes beyond nostalgia-led branding. It reflects a broader strategic recalibration in one of India's largest consumer sectors, where differentiation has become increasingly difficult. India's non-alcoholic beverages market, spanning carbonated soft drinks, packaged water, juices, tea, coffee, energy and sports drinks, ready-to-drink beverages and functional drinks, was valued at around $18.6 billion in 2025, with consumption nearing 34.9 billion litres. The market is expected to reach $27.6 billion by 2031, expanding at a CAGR of nearly 6.8%. Add to that India's alcoholic beverages market, estimated at roughly $48 billion, and the country's beverage industry now represents a market worth close to $65-70 billion.

At that scale, growth is no longer determined solely by manufacturing capacity or distribution reach. Shelf space can be bought, and advertising can generate awareness, but sustained consumer preference is becoming harder to earn. Increasingly, beverage companies believe regional flavours offer a more defensible competitive advantage because they begin with something brands usually spend years trying to build—consumer familiarity.

Beyond Trial: Why Repeat Purchase Is the Real Indicator

For many beverage founders, the first signs of success did not emerge through rapid expansion or marketing campaigns but through repeat consumption.

Lahori Zeera's early growth, for instance, was driven less by distribution milestones than by consumers repeatedly choosing the product for everyday consumption. According to Nikhil Doda, Co Founder and COO of Lahori Zeera, strong word-of-mouth translated into bulk purchases, with households and offices gradually making the drink a regular refrigerator staple. Its expansion beyond North India in 2022 further demonstrated that regional flavours were capable of travelling well beyond their geographical origins when backed by consistent product experience.

The same pattern is visible elsewhere. TABP Snacks and Beverages argues that low-priced beverages can generate impressive trial numbers simply because the purchase decision carries little risk. Repeat purchase, however, offers a far more meaningful indicator of product-market fit.

As Prabhu Gandhikumar, Co-Founder and CEO of TABP Snacks and Beverages, puts it, "At a ten-rupee price point, trial is cheap, almost anyone will pick up a bottle once. The metric that told us the truth was repeat." According to him, products such as Lemon Salt, Jeera Soda and Paneer Soda began seeing consumers repurchase within days rather than months, indicating habitual consumption instead of novelty-driven experimentation.

Retail behaviour reinforced the trend. Independent retailers, particularly in smaller towns, started reordering regional SKUs without active sales intervention, suggesting that consumer demand—not promotional push—was driving replenishment. Regional flavours have since become an important contributor to TABP's growth, helping the company cross a gross merchandise value of ₹212 crore in FY25 while tracking an annualised run rate of nearly ₹280 crore.

Taken together, these indicators point to an important distinction. In categories driven by impulse purchases, repeat consumption often becomes a stronger leading indicator than market share. Household penetration follows, while broader market leadership tends to emerge much later.

Reinventing Familiarity Rather Than Selling Nostalgia

Regional flavours are also evolving beyond straightforward recreations of traditional recipes. Rather than simply bottling familiar tastes, several emerging brands are experimenting with combinations that retain cultural familiarity while appealing to more contemporary preferences. The strategy reflects a broader shift in premium food and beverage categories, where consumers increasingly seek novelty without abandoning recognisable ingredients.

The ready-to-drink (RTD) line follows this approach by pairing ingredients already embedded in Indian consumption habits into newer flavour combinations. The emphasis, according to Radhika Sharda, Co-founder of Twisted Tails, is less on recreating tradition and more on modernising it. Orange blended with coffee or tea paired with jasmine are examples of products designed to balance familiarity with experimentation, making regional ingredients feel contemporary rather than conventional.

The same principle is increasingly influencing India's premium alcohol segment, although through provenance rather than flavour memory alone.

Ingredients once associated almost exclusively with specific geographies—including mahua, feni, Darjeeling tea and regional botanicals—are now being repositioned within premium spirits. Rather than remaining niche products consumed locally, these ingredients are being introduced to national audiences seeking differentiated experiences.

For Prem Dewan, Chairman and Managing Director of DeVANS Modern Breweries, the opportunity lies in combining Indian heritage with premium positioning. He believes, “regional ingredients are becoming increasingly relevant as consumers move beyond established brands in search of authenticity and distinctive experiences, particularly across premium segments.”

Solving a Business Problem, Not Just a Product Problem

Perhaps the strongest case for localisation is that it addresses commercial challenges extending far beyond product innovation. One of the industry's longstanding limitations has been its inability to formalise large portions of India's unorganised beverage consumption. Street beverages, despite enjoying enormous popularity, have historically remained fragmented because branded alternatives struggled to replicate both taste and familiarity.

Regional flavours potentially reduce that gap. Unlike entirely new beverage concepts, flavours such as jeera or paneer soda arrive with decades of consumer awareness already built into them. Brands therefore spend less effort educating consumers about what the product is supposed to taste like and more effort delivering consistency, quality and accessibility.

For companies operating at affordable price points, localisation also complements other business fundamentals including smaller pack sizes, value pricing and deeper rural distribution. Premium brands, meanwhile, are leveraging regional ingredients to strengthen storytelling, justify premiumisation and align with growing consumer interest in authenticity.

The underlying strategy differs across categories, but the commercial objective remains remarkably similar: reduce the cost of acquiring consumers by building upon tastes they already understand.

Can Regional Flavours Build India's Next Beverage Giant?

The industry's optimism extends beyond individual product launches. Several founders believe India's next ₹1,000-crore beverage brand may not emerge from inventing an entirely new flavour but from systematically scaling one that consumers have known for generations. The challenge is unlikely to be flavour acceptance. Instead, execution will determine success—cost engineering, manufacturing scale, nationwide distribution and the patience required to build volume-led businesses.

There is also growing recognition that the opportunity may not lie in one nationally dominant flavour but in portfolios of regional beverages, each commanding leadership within its home market while collectively creating national scale through shared branding and supply chains.

That thinking represents a significant departure from earlier beverage strategies, where success often depended on creating one universal flavour capable of appealing to every consumer. Today's localisation strategy accepts that India's diversity is an advantage rather than a constraint.

Brand identity, however, remains equally important. Founders acknowledge that flavour alone cannot sustain long-term growth. Successful brands will still need to build trust, consistency, distribution strength and emotional relevance beyond the product itself.

Localisation Becomes a Long-Term Growth Architecture

Viewed together, these developments suggest regional flavours are no longer functioning as occasional line extensions or festival-led innovations. They are increasingly influencing portfolio decisions, innovation pipelines and long-term capital allocation across both alcoholic and non-alcoholic beverages.

Several structural shifts are reinforcing this momentum. Rising disposable incomes have expanded discretionary spending, quick commerce has dramatically shortened the path from curiosity to purchase, and Tier II and Tier III markets are increasingly shaping national consumption trends instead of merely following metropolitan preferences.

What makes the localisation trend particularly significant is that it addresses multiple industry challenges simultaneously. It lowers consumer acquisition friction, creates differentiation in an otherwise crowded marketplace and allows brands to premiumise through authenticity rather than imported aspiration.

For an industry searching for its next phase of growth, regional flavour appears to have evolved from a product innovation tactic into something considerably larger. The companies succeeding today are not merely bottling nostalgia. They are recognising that India's greatest competitive advantage may lie in tastes consumers never stopped loving in the first place and building scalable businesses around them.