D2C brands are looking to move beyond discount-led growth and focus on product differentiation and repeat purchases as consumers become more discerning this festive season, with companies reporting stronger demand for products that offer distinct value rather than lower prices.
The shift comes amid rising customer acquisition costs and margin pressures, prompting brands to rethink their reliance on promotional offers to drive sales. While festive demand has been uneven across categories, brands say consumers are taking more time to evaluate purchases, placing greater emphasis on product quality, design and convenience.
Theater xyz, a fashion brand targeting women, said its winter season, which begins around Diwali and extends through the wedding months and winter holidays, was tracking close to twice last winter’s levels. Orders and average order values have risen, driven largely by boots and stockings.
“I think every brand has to decide early what it wants people to come back for. If it’s the price, you end up in a race you can’t really win, because there’s always someone willing to go lower. If it’s the product, you’re building something that lasts,” said Sarthak Aggarwal, co-founder and CEO of Theater xyz.
Sleepy Owl, meanwhile, expects festive-season growth of about 25 per cent over last year, when sales rose 15 per cent from the previous year. The coffee brand said it was using festive sales events to attract new customers while returning to regular pricing once promotional periods ended.
“We use discounts to start a relationship with a consumer, not to sustain it,” said Ajai Thandi, co-founder of Sleepy Owl.
The company is investing 10 per cent of its revenue annually in new product development and quality. Products launched over the past 12 months contribute close to 20 per cent of its net revenue, while Vietnamese Cold Brew sales have grown eightfold since launch. Its 100-gram coffee jars are also growing faster than sachets, indicating that consumers who initially try smaller packs are moving to larger ones.
Thandi said demand for the brand’s jars and ready-to-drink range had increased more than 50 per cent, despite their prices being at par with or above competing brands. Quick commerce remains its strongest sales channel, while growth in Tier 2 and smaller markets has crossed 200 per cent, accounting for more than a quarter of revenue.
“The conventional description of India is a price-led market. What we have found is a market led by value,” he said.
For Theater xyz, repeat purchases are emerging as a measure of brand strength. About 40 per cent of its winter sales come from returning customers, with the share growing steadily over the past year. The company has focused on refining existing styles, introducing new winter colours and improving the customer experience rather than relying on occasion-led collections or frequent discounts.
Aggarwal said the trend towards more considered purchases was also visible in winter fashion, with classic styles outperforming trend-led products. Consumers were buying fewer items but placing greater emphasis on design and quality, he said.
For both brands, the focus is on converting first-time festive shoppers into regular customers. Sleepy Owl is prioritising year-round visibility and products that encourage habitual consumption, while Theater xyz is banking on product quality and the unboxing experience to bring customers back.
The broader strategy reflects an attempt to make festive-season sales translate into sustained demand, rather than a temporary spike driven by price cuts.
Published on October 29, 2026
