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1.0 Introduction
Undoubtedly, India is a growing economic super power. Though the raging fire of global economic slowdown has engulfed almost all the nations, India, a country of 28 states, with over one billion people, has somewhat escaped the scare.
India is a big country that consists of various segments of consumers, based on income, class and status. The most recent and crucial development in India’s rising consumerism story is the birth of the rural market for basic consumer goods. For the starters, more than half of India’s populations reside in rural areas, who contribute to the national income, in a big way. The Indian rural population is scattered all across India in nearly 0.6 million villages.
India is a profitable market though the per capita income is low. And it remains a huge market even for expensive items.
2.0 Salient features of The Indian Consumer Behavior
Indians are known to be, one of the shrewdest customers in the world. The ‘value factor’ very much intertwined with their lives, so much so that even luxury brands have to devise unique pricing strategies to inspire the great Indian consumers.
Indians are family people. The family, for instance, even includes extended family and friends as well. Brands that endorse family values are naturally more popular and can make easy in roads in the Indian market.
Also, Indians give more importance to nurturing, care and affection, than values like ambition and achievement. The products that talk of such feelings find it easy to attract the Indian consumers.
Besides, psychology and economics, even history and traditional products have played a crucial role in the evolution of Indian consumers. This may be one of the reasons why we find both traditional and modern products placed alongside, at the stores.
3.0 Various fragments Of Indian Consumers
3.1 The Socialites
Socialites hail from the upper class. They shop from specialty stores, visit clubs and spend lavishly on luxurious items. Socialites are especially brand conscious and would prefer to spend only on well-known brands.
3.2 The Conservatives
Conservatives hail from the middle class. They are the showpieces of true Indian culture. Quite conventional in their outlook, they do calculated spending and believe in giving more time to their families than in parties. Focus more on savings than in spending. 3.3 The Working Women
From the late nineties, there has been a rise in this class. This segment has especially unleashed opportunities for the retailers in India. Today, she is standing shoulder to shoulder to men. Working women have their own choices when it comes to purchasing goods.
4.0 India’s Wealthy
India’s wealthy can be divided into five major categories as follows:
4.1 The wealthy
These are well-heeled, upwardly mobile people. Some of them fall in category of Double Income No Kids (DINK) households. They spend a lot on leisure and entertainment. They desire to achieve super-rich status.
4.2 The Super wealthy
The Super Rich primarily consists of professionals who are devoted to consumerism. They buy many durables and are very status oriented. Less number of DINKS here.
4.3 The Ultra wealthy
The ultra-rich includes some DINK households of middle-level executives. Some are first generation entrepreneurs; some are rich farmers, who have been rich for a long time.
The Sheer wealthy
Joint families as well as nuclear families fall in this category. Own several cars and houses. They aspire for social status and power.
4.4 The obscenely wealthy Some of them are first-generation entrepreneurs, some are techies. They may be equal to the rich from the developed countries.
5.0 Rural Consumer
More than half of India’s population resides in rural hinterlands. And with evolving middle-class, especially in the urban cities, there is a natural spill-over effect in the rural areas as well.
The Indian rural market is apparently growing at 3-4% per annum, thereby adding more than 1 million new consumers every year. Today it accounts for nearly 50% of the volume consumption of fast-moving consumer goods (FMCG) in India.
6.0 Increasing knowledge of Indian Consumers
Rise in literacy rates and exposure to the west, satellite television, newspapers, foreign magazines and newspapers have all led to the phenomenal rise of Indian consumer. Today, more and more of Indian consumers have become choosy and demand quality products at competitive prices. They prefer to purchase from renowned retail stores, where accountability is evident and feedbacks are given prominence.
7.0 Marketing Strategies
7.1 E-commerce or On-line marketing
A study carried out by the Confederation of Indian Industry (CII) and the International Trade Centre reveals that e-commerce activity in India will rise from US$ 0.10 million in 2000-01 to US$ 5.8 billion in 2005-06.
At present, the products Indian consumers prefer to buy via online stores are greeting cards, clothes, CDs/VCDs/DVDs, cassettes, books, magazines, medicine and educational material.
The known online shops in India include:
• www.ebay.in
• www.shopping.rediff.com
• www.shopping.expomarkets.com
• www.reliablegreetings.com
7.2 Star Power
In India, all big brands try to rope in big stars to promote their brands. Known as brand ambassadors, these stars are said to lend personality to their products thereby building a perpetual presence on the minds of the consumers, and with the visual media gaining more popularity, the number of celebrities being employed in the TV media has also increased like never before. Celebrities help create hot-selling headlines. Their activities and movements are closely monitored. Whatever they endorse are picked up by the common masses with consummate ease. So using celebrities in advertisements has become common place. Indians love their heroes and heroines. So if a consumer finds their lovable celebrity endorsing a particular brand, it becomes easier for them to relate to the product and therefore will have more optimistic feelings towards the advertisement and the brand in itself.
Moreover, it is an established fact that advertisements that celebrities endorse have high recall rates. Celebrities also aid in repositioning of products. Products with dropping sales can be rescued by smart selling ads by leading celebrities.
. 7.3 Quality Oriented Outlets
Indian consumers have a tendency to choose branded products that are pretty expensive, because they feel that branded products are quality driven. While buying products, that are not brand driven, they opt for retail outlets, because they feel that retail stores offer quality products.
7.4 Freebies
Discounts and freebies is what attract the Indian consumer. TVs, washing machines, refrigerators, and ready made clothes are few of the product categories in which freebies are available. Even tooth paste, soaps, detergent, cooking oil etc. comprise of freebies. So foreign companies planning to gain foothold in India should especially consider giving freebies for the purchases made by the Indian consumer. Working with a local business partner will give further insights on such promotion campaigns.
7.5 Eco-Friendly Products
Eco-friendly products seem to be the new mantra of the Indians. Indians in the future are likely to get attracted to environment-friendly products and packages.
So, the master key for marketing could be choosing ecological responsible products and packaging, which will be convenient for consumers, thus, complementing environmental concerns with commercial considerations.
8.0 Changing Patterns in Indian Consumer Behaviour
Changing times have been influencing the lifestyles and the buying behaviour of Indian consumers. And with rise in salaries and increase in working urbanities, the changes in patterns have become much more evident.
8.1 Bulk Buying
The working class is more interested in fast and ready-to-serve food, rather than home-cooked food, as they want to save themselves from the troubles of cooking and cleaning.
Bulk Purchasing seems to be the order of the day, with purchasing becoming a week-end affair. No more fleeting visits to neighborhood stores on day to day basis.
The current trend is buy things from hyper stores and super markets.
8.2 Stylish Lifestyles
There seems to be heavy western influence on urban middle and upper class Indians. There is a positive attitude with regards to western trends. Moreover, the Indian consumers are much more flexible and experimental in their approaches. And via media and Indian’s working broad, this has been spiraling growth in western trends. Increasing number of beauty parlours in the city, eateries, designer wear, watches, hi-tech products are a few examples which mirror these changes.
Foreign products have made rapid in roads in India, in the following categories;
• Packed food
• Beverages
• Ready to eat food
• Canned food
• Pre-cooked food
• Personal care products
• Garment and apparel
• Audio/video products
• Footwear
• Toys
• Sportswear
• Gift items
Foreign made furniture is very popular among the Indian consumers. Malaysian, Italian and Chinese furniture are highly favoured in India.
8.3 Seller’s Market Paving Way for Buyer’s market.
The seller market is slowing giving way to the buyer’s market. With economic liberalization initiated in 1991, new products have made way into the Indian markets, thereby increasing the product varieties. Import licensing restrictions have been abolished, and as a result an assortment of consumer goods has been flooding Indian markets.
Indian consumers have always longed for foreign goods and with open-market policies being practiced by the government, their longings has apparently reached a fruitful end.
Conclusion
Top class, middle class and lower class are primarily the three classes in India and each class has its own consumption pattern.
Foreign companies planning to establish base in India should focus on capturing the substantial middle class market having substantial disposable income.
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