Why India's Retail Giants Are Diverging on Customer Acquisition Strategies

DMart is swinging ad budgets up while Trent and V-Mart are cutting spend — and all three are growing. That contradiction should rewire how you think about CAC this quarter.

DMart (Avenue Supermarts) pushed its miscellaneous spend — which includes advertising — to Rs 677.04 crore, up from Rs 570.78 crore the prior year. Revenue climbed 16% YoY to Rs 66,968 crore, with PAT hitting Rs 3,224 crore. Trent, owner of Zudio and Star Bazaar, did the opposite: it trimmed ad and sales promotion spend to Rs 116.04 crore from Rs 126.76 crore, and still posted Rs 21,314 crore in revenue across 1,286 stores. V-Mart slashed promo spend to Rs 75 crore from Rs 83.30 crore and somehow printed a 171% PAT surge.

Same market. Same channel pressure. Wildly different bets on customer acquisition cost.

Scale the spend — but only if the unit economics hold

DMart's move is the one most growth marketers default to: throw more dollars at the top of funnel, absorb higher blended CAC, and trust the basket size to cover it. The company now runs 500+ stores across 15 states, with groceries pulling 57.9% of sales, merchandise and apparel 22.28%, and home and personal care 19.82%. When your mix is daily essentials, you can stomach a higher CAC because repeat purchase frequency is structural. That's the playbook. If your LTV-to-CAC ratio doesn't back it up, you're not DMart — you're burning inventory.

The Zudio counter-bet is sharper. Trent publicly states Zudio avoids heavy advertising and price discounting, preferring visibility through micro-market expansion. No online sales channel. Zero dependence on performance marketing for that brand. Acquisition cost is effectively rent and store traffic. For value fashion at that price point, that math works. For your DTC brand at scale? Test it. Don't assume it.

Hyperlocal is the underrated lever right now

This is where the real tactical signal lives. Trent's grocery chain Star Bazaar runs a hyperlocal playbook: digital comms, flyers, messaging campaigns, and community-level engagement inside housing societies. That's not branding. That's direct response targeting a 2-kilometer radius with hyper-relevant creative. Your CTR will spike when the message is about tonight's dinner, not your brand's origin story.

V-Mart acknowledged the same shift — social, influencer marketing, and targeted digital campaigns are now central to how it acquires customers, even as overall ad spend came down. Translation: they're reallocating from broadcast to precision. Same budget envelope, tighter audience definition, better conversion. V-Mart still grew revenue 16% to Rs 3,789 crore with that approach. If you're still running broad-match Meta campaigns without a local creative matrix, pivot this week.

What to execute today

Stop treating "more ad spend" and "less ad spend" as a philosophy debate. Both DMart and Trent printed growth — the variable is the model, not the budget. Audit three things before your next media plan:

• LTV by category, not by channel. If repeat purchase is high, scale. If it's a one-and-done SKU, your DMart imitation will hemorrhage margin.
• Hyperlocal creative variants. Build radius-specific messaging now. Housing society, neighborhood, district. The brands pulling back on mass spend are winning because their creative is narrow and relevant.
• Reallocation, not reduction. V-Mart cut total spend and grew PAT 171%. That's not austerity — that's portfolio surgery. Kill the underperforming channels before you cut the budget.

The Retailers Association of India pegged retail sales growth at 7–8% by mid-FY26, up from 4–5% at the start. Demand is there. The question is whether you're capturing it with precision or praying the algorithm blesses your broad targeting. Dominate the second one. Or get outpaced by someone who already did.