Retail is the new buzzword in India. Buying ritual has become shopping experience. It is a celebration and entertainment. Lifestyle is changing rapidly. The concept of value for money is gaining importance. The information that the Indian consumer has access to is immense which leads to the freedom of choice and in turn the demand for the differently organized retail formats. The traditional way of retailing is also organized but differently organized. The changing income profiles, change in consumption patterns, changing demographics, diminishing difference between rural and urban India demand the change in the way the retail business is carried out in India.
The size of population in India has always made it a large market. 1.10 billion People and almost 40 % of the population is youth which makes it more lucrative market. Aspiration, wants of these people thought are different but it definitely creates the opportunities for the retail trade which keep growing every day. One more aspect of this population is that the 26 % of the population is still below the poverty line but still catering to the basic needs of these people (As per the Maslow’s Hierarchy of Needs) is daunting task which creates enormous opportunities for retail.
The definition of income classes vary from one study to another. According to NCAER the average middle class family’s disposable income rose by more than 20% from 1993 to 2006. The middle income and the upper income categories are likely to witness the most significant expansion in the coming decade. The upper and middle class are likely to increase their share in the population from 19.6% in 1995 – 1996 to 42.6% in 2009 – 2010. , a substantial increase, while the middle income group likely to witness an increase from 32.9% to 39.8% in the same period.
Diminishing difference between Rural and Urban India
Rural India amounts to 70 % of India’s population and this itself offers a tremendous opportunity for generating volume driven growth. It is interesting to note that LIC sold 50% of its policies in Rural India in year 2005-06. Of the over two million BSNL mobile phone connections more than 50 % are in small towns and villages. This kind of phenomenon is evident in all type of products and services. So the diminishing difference between the Rural and Urban India is pretty evident. This makes it easier for the marketer to develop and market new goods and services for the Indian consumer.
The rise of the self-employed
Rural India has always been largely self-employed. But now the proportion of the self-employed in urban India has risen to 40% plus, replacing the employed salary earner as the new 'mainstream market'. A Hansa Research Group (HRG) study shows that even in the 'creamy layer', comprising the top two social classes in towns of 10 lakh plus population in urban India, 40% of chief wage earners of households are shopowners, petty traders, businessmen and self-employed professionals.
Unlike the salary earner, the self-employed use products much more to signal success and are also fast adopters of any productivity tools, like cellphones and two-wheelers, that can help them earn more.
Striving
Most Indian consumers, whether rich or poor, want to get ahead in a hurry. From being destiny-driven and resigned, they are now destination-driven and striving to grasp opportunities to earn more in order to construct a better life for themselves and their children. If one were to segment the country into the Arriving, the Striving and the Resigned, the proportion of Resigned has definitely decreased and become geographically concentrated, rather than well-dispersed, as it was earlier.
The rise of the woman
Like the self-employed, women too are saying "I can and I will," and emerging as partners in family progress. Not so much from earning the second income (a mere 23% of Indian households have working wives and that proportion decreases as incomes increase) but by being CEOs of households and intellectual nurturers of their children.
helpful! thank you
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