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Indian diners demand greater quality, value and experience
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Tuesday, 22 September, 2026, 08 : 00 AM [IST]
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Anurag More, Mumbai
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The Indian restaurant industry is witnessing a shift towards more niche-oriented, quality-conscious and experience-driven consumption, with diners becoming increasingly discerning about food, service, ambience and overall value.
According to Rahul Khanna, co-founder and director, Azure Hospitality, consumers are willing to spend more when they see genuine value, but premiumisation is increasingly expected to be backed by quality and substance.
Khanna said consumers today have greater awareness of ingredients, cuisines, provenance and the overall dining experience. Simply having an attractive restaurant or fashionable menu is no longer sufficient, as guests are evaluating the complete experience, including food quality, service, ambience and consistency.
“The customer is willing to pay more, but expects a corresponding increase in quality and experience,” he said. For restaurant operators, however, manpower remains one of the key challenges. Khanna highlighted the difficulty of finding and retaining quality talent across kitchens, service and management as the industry continues to expand. He also pointed to the regulatory environment, with licensing and approvals remaining time-consuming and fragmented in several markets.
For multi-city operators, he said, the ability to scale consistently while navigating local requirements is particularly important. Azure Hospitality follows a balance between protecting the core identity of its brands and adapting to local consumer preferences. Khanna said signature dishes, quality standards and the overall brand experience need to remain consistent, while certain dishes and experiences can be modified based on local consumption patterns.
“The objective is not to make every outlet identical. It is to make every outlet recognisably the same brand while ensuring it feels relevant to its market,” he said.
He added that understanding local markets is important, with teams required to remain close to consumer behaviour and market-level developments. The company therefore adopts a degree of market-level management wherever required.
With consumers having more dining options, experiential dining, ambience and service have become increasingly important in restaurant selection. Khanna noted that design, social media and launches can generate significant initial buzz, but these factors alone do not determine long-term success.
According to him, the sustainability of a restaurant ultimately depends on its ability to consistently deliver food quality, service, ambience and hospitality. Experiential dining can create discovery and excitement, but strong fundamentals are required to convert that interest into repeat visits and a sustainable business.
Indian diners are also becoming more willing to experiment with international cuisines and new dining formats. Khanna said consumers are showing greater curiosity towards niche cuisines, regional interpretations, sharing-led formats and concepts that go beyond the conventional restaurant experience.
However, he pointed out that consumers are increasingly looking for authenticity and a clear point of view rather than novelty alone. This creates an opportunity for operators to introduce new cuisines and formats while keeping them approachable without diluting their identity.
Customer feedback and changing consumption patterns are playing a growing role in Azure Hospitality’s menu decisions. Khanna said the company has become increasingly data-led, using daily feedback, business intelligence, sales patterns and customer responses to identify areas for improvement.
The approach allows the company to respond to emerging patterns without waiting for a formal menu review. Adjustments could involve dishes, portions, pricing, formats or presentation.
“The menu has to remain a living part of the business rather than something that is fixed once it is printed,” he said. Looking ahead, Khanna expects niche-oriented cuisines, sharing-led concepts and chef-led restaurants to gain further traction. He also sees increasing emphasis on concepts with a strong point of view and a differentiated overall experience.
At the same time, he believes the market will increasingly distinguish between concepts that generate initial buzz and those that establish long-term relevance. Restaurants that combine novelty with strong operational and culinary fundamentals, he said, are likely to have greater staying power.
Growing consumer awareness around food quality and ingredients is also influencing the restaurant sector. Khanna said health-conscious eating has long been part of Azure Hospitality’s approach, but the level of consumer awareness has increased considerably.
Guests are asking more questions and paying closer attention to the ingredients they consume. Similarly, premiumisation is becoming more nuanced, with consumers looking for better quality and a clear justification for paying a premium rather than luxury for its own sake.
For sourcing, Azure Hospitality works with suppliers that can deliver quality and scale consistently across locations. Khanna said consistency is particularly important for a multi-brand, multi-city business, requiring sourcing partners to maintain standards as the company grows.
The company is also increasingly evaluating suppliers and partners based on responsible and sustainable practices. Khanna said sustainability should be viewed as a long-term operating principle rather than a marketing trend, with responsible sourcing and reducing unnecessary waste among the areas where restaurants can make a meaningful difference.
Azure Hospitality’s expansion strategy is focused on building a stronger presence in selected markets rather than expanding purely for footprint. Khanna identified NCR, Bengaluru and Hyderabad as important markets for the company, while Mumbai also remains significant.
The company plans to substantially scale its business over the coming years through a combination of company-operated and franchise-led expansion, depending on market conditions and the suitability of individual formats.
Khanna said Azure sees opportunities in both established metropolitan markets and emerging cities. While metros offer scale and a sophisticated dining ecosystem, emerging cities are also showing stronger consumer expectations and spending behaviour.
“For us, the question is less about whether a city is a metro or an emerging market and more about whether the brand has a genuine fit with that market,” he said. Before entering a market, Azure evaluates consumer and sales data, historical performance, competitive mapping, catchment potential, demographics, spending behaviour and the existing dining ecosystem. In franchise markets, local knowledge also plays an important role, with partners expected to provide insights based on their understanding of the market.
Azure Hospitality is continuing to explore concepts with a distinct identity and a clear reason to exist. Khanna cited Jhoom as an example, describing it as a standalone concept built around a multi-cuisine food offering, beverage-led programme and experiential elements.
More broadly, the company is looking at concepts that combine distinctive food, hospitality and a compelling environment rather than simply replicating existing restaurant formats.
Khanna expects the Indian restaurant industry over the next three to five years to become more organised, specialised and quality-driven. With consumers gaining more choices, brands will need to establish a clearer identity and communicate what they stand for.
He expects continued growth in niche cuisines, chef-led concepts, experience-driven formats and brands focused on building customer loyalty rather than relying primarily on launch-led excitement.
For Azure Hospitality, the objective is to build a portfolio of distinctive and scalable brands while maintaining their individual identities and quality standards as the business expands across India.
“The next phase for the industry will not simply be about opening more restaurants. It will be about building better brands, stronger experiences and businesses that can sustain relevance over the long term,” Khanna said.
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