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Contents
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. Made for India The mixed message from Consumer India Why bother with Consumer India Understanding Consumer Indias demand structure Just how much purchasing power does Consumer India actually have? Schizophrenic India Demographics, psychographic and social determinants of consumption How to read and predict change in Consumer India Cultural foundations of Consumer India Young India, woman India: a closer look Rural Consumer India Understanding the bottom of the pyramid Consumer India Winning in the Indian market
The coming together of a diverse set of economic, demographic and social change waves-point towards the fact that a brave new market is here. Evidence shows that strong India continues to grow steadily and is here to stay. The changing shape of income distribution suggests growth in both rural and urban incomes which in turn should herald a consumption boom With a rise in aspiration, sophistication of the middle class, liberalisation, being a national of self-employed, comfort with technology and rural India going beyond agriculture are more reasons to bother with Consumer India Beyond market potential: the triple whammy potential of India: huge demographic-economic opportunity; global cost cutting opportunities; the disruptive innovation capability of talented scientists and managers
The NCAER study shows that The 2 largest consumer classes are the climbers and the consuming class, with about 75 million households each.
Dynamics of future growth: There is constant value growth as there is a virtuous spiral of demand as each class graduates into the next
Just how much purchasing power does Consumer India really have?
GDP per capita number would suggest that purchasing power isnt much. However averages about India are misleading and reality is quite different. Myth of India's middle class: an idea that was packaged and sold to the world as a sales pitch for FDI in the early mid 1990s. After lying dormant from 2000, the idea is resurfacing. However there is no unique or universally accepted definition, it is much poorer when compared to the middle class in developed countries. How to think about the purchasing power of Consumer India: must abandon debate about size and affluence of Indian middle class. Must replace model of a monolithic middle class with a multi-layered model of people.
Just how much purchasing power does Consumer India really have?
While income is understated and does not measure the real thing, it is perfectly usable for grading the population based on its relative purchasing power and to compare the growths and declines of various income groups over time. In India, consumption is like maternity-a certainty, income is like paternity-matter of inference Forecast for 2005-6 to 2009-10: in the next 4 years, rich households will continue to increase equally in both urban and rural areas. A rural middle income boom is also forecast. Along with this, a predicted fall in population growth rate (more in rich households) will make the rich, richer in terms of disposable income. If this is accompanied by a drop in price thresholds, then there will be substantial market growth for products and services across the board.
Schizophrenic India
Define My Target India: Consumer India has 5 consumer classes-benefit maximizers; cost-benefit optimizers; benefit point constrained cash minimizers cash constrained benefit maximizers; destitute Urban and rural India are different worlds evolving at different speeds. 28 states are totally different from one another. Now there are 4 age cohorts with 2 distinct consumption ideologies and shades in between: Indias pre-independence generation, first post-independence generation: both with socialist ethos. Now children post liberalisation and the next generation confident about its new path 5 economies: agriculture, manufacturing, government, services, IT The good news is that there is plenty of choice for creating competitive advantage by defining my target India innovatively.