The Brand-Building Bypass

Way before Indian supermarkets or marketplaces existed, back when my mom bought her monthly groceries from the friendly neighbourhood store, I always saw only one edible oil brand in my house – the Postman. When I first set up independent home in Mumbai, this was the one non-negotiable item on my grocery list. Though it has faded from shelves after a family dispute split the business, I still buy the inheritor of its legacy, the Primio brand. In a world of fancy cold-pressed oils and many new choices, it remained my grocery staple. 

This is what brand trust can and cannot do – it can support a price premium and a loyal customer, but it must be constantly refreshed to bring new customers into its fold. As young brands storm our virtual shelves, what does brand trust look like today?

One of the biggest changes is how brands find their way into our houses now. Getting on to that kirana shelf was harder in the past, especially buying in the trust of the distributor and of course needing a significant media budget to create the consumer pull. That friction became a filter, creating a high entry barrier, likely keeping many good ideas out. But it also meant that by the time a brand got big, with distribution and sustained visibility, it had built the organisational and brand capability to match. But that brand journey has now changed significantly.

Marketplaces, D2C fulfilment and Q-commerce mean it’s no longer as hard to build the channel, though it’s harder to own the customer relationship. Access is more democratic, as much for the small-town consumer as for the young brand trying to find her. A company can successfully scale up before it necessarily has the kind of brand pull that used to be a pre-condition for size. This comes at a cost. And as a sizeable number of the earliest digital-first companies become more than a decade old, they are beginning to feel it.

Visibility has of course changed dramatically. It's not exactly cheaper but it is more fungible because it can be broken into parts. National television, the big front-page ads in newspapers or ads in the glossies cost monumentally large sums in one go. Now new brands can pick and choose small pockets of visibility – be it Meta, Google, Amazon or Blinkit ads, or content creators for performance marketing – buying one customer cohort at a time, adjusted in real time across different platforms.

Most of the new digital brands identify white spaces, building a clear, specific and often defensible claim, often around a transparent ingredient list, hoping for this to be their moat (it isn’t, as we will see). And capital access has eased up in about last two decades of venture funding. In short, young brands identified clear niches, used labelling and logical problem-solving to earn credibility, did not face the distribution hurdles of the past, and had capital and flexibility to pay for discovery and visibility.

These four factors completely changed the trajectory of consumer brands: distribution became accessible, visibility became divisible, functional white spaces became easier to identify and communicate, and capital accelerated all three. In the process, scale became purchasable before brand trust was fully built. But this often creates misleading signals that brands discover too late unless they are actively paying attention.

This is where it gets a little tricky for the founders. Most founders and boards review the lifetime value or LTV to customer acquisition cost, or CAC, ratio. But brand and performance are optimised by different teams with different incentives. Brand payoff, in the sense this essay means it – price premium, extension into a new category, surviving a competitor's copy – often takes years to become clearly visible. Performance marketing gives you an answer in days while a brand takes years to build. But fundraising cycles, founder attention and board reporting typically run on a 12- to 24-month clock. So even a genuinely disciplined team that reviews the ratio every week, is still structurally biased toward that window.

It’s not that founders choose scale over brand on purpose. They may be seeing a healthy CAC-to-repeat curve, and a well-run company may be tracking the metrics through cohort retention, payback periods, LTV-to-CAC, returning customer revenue and share of organic to paid customer acquisition. But here is a visual of how these number can be misleading without deeper dive.

The problem is compounded when brands remain dependent on the logical promise that first got them customer attention, without building a deeper brand value beyond that promise. The problem-solving premise is a great launch and entry point but also quite easily copied. A large share of new skincare launches now carry some version of a clean or ingredient-forward claim. Once "toxin-free" stopped meaning anything because everyone said it, the goalposts moved to ingredients, concentrations and clinical proof. But each of these has limiting ability to build brand trust.

The question founders need to ask is: how much of today’s growth will bring customers back tomorrow without having to pay for them all over again? Founders are tracking three different metrics but each moves at a different speed. The revenue track moves the fastest. The cohort track, whether customers are actually repeating, referring and becoming more valuable over time, moves slightly slower. A company can grow revenue for years before a weak cohort becomes obvious. Lastly, the brand, whether the company has created durable preference beyond its first claim, is slowest of all and hardest to measure. It's therefore the one that gets ignored unless someone, say an investor or an acquirer, looks into it intentionally. It’s normal to lead with revenue but the mistake is to miss checking if the others are keeping pace, to not assume that revenue growth means a equivalent, similar growth in customer cohort track or brand building. So this cannot be fixed with a pre-fixed allocation between brand and performance marketing but to consciously measure whether the paid growth is progressively producing repeat, independent pull.

This is what opens up what’s been called the brand debt: the gap between how big a company has become and how much independent preference it has actually earned from customers who would choose it even if an identical claim showed up somewhere cheaper tomorrow. The danger is that it can go untracked and invisible till it begins to show up in rising CAC, in growth that needs more discounting, or in the inability to launch new products or extensions.

There are three noticeable signals for brands that are succeeding in building this trust. First, can advertising intensity fall while revenue keeps growing? Second, what happens when the spending is actually pulled back? And third, when a rival matches the first claim exactly, does the customer still choose you, including extensions into new versions/ products? 

For instance, The Souled Store’s revenue rose while advertising intensity fell and similarly, Plum turned profitable in 2024-25 with its ad budget shrinking in absolute terms. Bewakoof, on the other hand, saw revenue remain broadly flat while ad spend stayed high relative to revenue.

The second test is not as simple as whether revenue falls when spending falls. Happilo cut its advertising and promotional spend from ₹694 million to ₹282 million and revenue fell from ₹3.29 billion to ₹2.80 billion. But its losses narrowed dramatically and it turned EBITDA positive. The result suggests the trade-off management was making: less bought growth, but much better economics. What matters is whether the company can then rebuild growth on a stronger base.

And then comes the test of durable preference. Once competitors can match your original product promise, will customers still choose you? And will they follow you into a new category? Wakefit began as a mattress brand before expanding into furniture and home furnishings. Furniture’s share of revenue rose from 24% in 2022-23 to nearly 28% in 2024-25, while repeat customers accounted for over a third of revenue in the first half of 2025-26. That does not necessarily prove that furniture carried a lower CAC, or that the same customers crossed from one category to another. But it is stronger evidence than the mere launch of an extension: a meaningful part of the business now comes from beyond the product that originally built the brand.

The renewed focus on payback periods, unit economics and margins is useful. But reducing ad spend or tightening the cost structure is not the same as building a brand. The real test is whether paid visibility is gradually creating more repeat purchase, direct demand and permission to move beyond the original product claim. Scale is not the opposite of brand building. The question is whether each round of paid growth makes the next one less dependent on being paid for.

This piece first appeared on Minari Shah’s Substack page, The Long View.