It's not just the consumer durables category. Marketers across various categories – from auto to fast-moving consumer goods to mobile phones are reporting the same trend – the growing preference for premium.

Take auto, where companies such as Maruti Suzuki and General Motors say they have seen 20-30 per cent of their new car buyers trading up to a premium hatchback rather than entry-level priced cars.

A CII Boston Consulting Group report ‘The Tiger Roars: How a Billion Plus People Consume’ notes a similar trade-up in the food and grocery segment. It notes that quantity of food consumed does not increase in the same proportion as food expenditure with rising income. Hence, "we believe that consumers in India are trading up in food and groceries,” it says.

With rising income levels, consumers demonstrate a higher propensity to trade up, such as, buy higher-quality, packaged, branded and more expensive food and grocery products, says the report.

Kannan Sitaram, Operating Partner, India Equity Partners, says there are two kinds of ‘premiumisation'. “You have the glucose biscuit consumers now buying more premium cookies – the Oreos and so on,” he says.

Then, he also points to the creation of new ‘expensive' categories. For instance, frozen food, ready to eats, packaged dahi are all new categories – expensive alternatives to home fare that more and more customers are opting for due to convenience. “At Hindustan Unilever, there was a time we struggled to sell the premium variety of tea. Now tea bags sales are exploding - there has been a lot of product innovation and consumers are willing to try new things,” he says. In FMCG too the trend is clear. “You have the sachet shampoo users moving to bottled shampoo in rural pockets. And in urban centres, Dove and Garnier – two brands that have really created the urge to buy more expensive shampoo,” he says.

B. Narayanaswamy, Consultant at Ipsos Research, says already-sensitised consumers are the ones trading up to premium. A young lad who has grown up in a house with a refrigerator is more likely to buy a more premium fridge as his first buy when he moves out of the parental home than a guy who has had to borrow ice from the neighbours, he explains. Ditto car buys – somebody who comes from a household that uses public transport will in all likelihood buy an entry-level category car, but someone who has grown in a car household will go for premium on his or her first buy.

Also, he says today's youngsters who are in their first well-paying jobs have a lot of discretionary income to spend as they are still staying with parents, thereby not incurring any rent, food expense and so on. So they are likely to spend their income on expensive gadgets, cars and so on.

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