Live Mint - December 25, 2013
Consumption kept the Indian economy going long after investment slowed, but over the past year, even this narrative has started to fray at the edges Will consumer spending in India shake off its sluggishness and go back to growing at a fast clip and in turn drive economic growth? The short-term answer of the next two years is that (1) the richer parts of it will step up spending in the next year and be the vanguard of growth, and since they account for at least 40% of all spending and over half of income, this is good news, and (2) however, we must be careful not to fall into our oft-repeated trap—assuming that the yo-yo upward growth that we are about to see as a result of release in pent-up demand is the right growth number to project for the future. The medium-term answer of the next five years […]
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Why festive spending this season is a litmus test for the economy
Festivals, the world over, are usually boom consumption time-when people know they have to spend, they are in a mood to want to spend, and they do plan ahead for the expenditure. Festival sales are therefore a barometer of how good or bad consumers are feeling about the size of their wallets and about spending. In consumption-driven economies, that is a critical determinant of economic growth. If spending doesn’t happen even at festival time, it is pretty bad news and a barometer of how good or bad the consumer economy is, the same way the prices of bellwether stocks tell a story. Last year, the world watched with bated breath to see what retail sales in America would be during the holiday season of Christmas and New Year. It was this indicator that would reflect exactly how bad things really were. If people decided to economise on that most sacred […]
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By Rama Bijapurkar
It isn’t easy to imagine the sort of pressure on public goods when a billion people – mostly young, slowly getting richer – aspire for a better life, especially when infrastructure and public goods are already of poor quality and in short supply. This is the environment in which the great Indian consumer story will “live” for the next several years, shaping consumer behaviour and throwing up unique market opportunities quite different from those of the past two decades. Toilets; affordable housing; health care; old-age homes; schools and colleges; power and water; police; garbage clearance; bandwidth; buses, trains and metros; playgrounds and parks, and many such improvers of life are just not available. Domestic tourism is burgeoning, thanks to more money, but there are no decent public conveniences. Next to premium Mumbai apartments with breathtaking sea views, the rocks in low tide are an unending public toilet for people living […]
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The Economic Times, Mumbai - January 30, 2012
Think local; it’s pointless to use western standards to measure India’s consumption base. India’s domestic consumption story has been told in terms of income based number crunching on the size of India’s middle class, and sales data from companies. After rural consumption came to the rescue in 2008-09-10, the story of rural consumption being the bulwark of future consumption has gained currency, almost as if the urban frontier has been conquered. Facts viewed through the lens of households help to do a reality check on existing mental models and numbers about India’s consumption story but are hard to get. We therefore welcome the new 2011 edition of the Indian Readers Survey (IRS) report, Guide to Indian Markets. Based on a rolling annual all India sample of 250,000 households, it is a standard market planning database, vetted by the Media Research Users Council (MRUC) and conducted by Hansa Research for over 10 […]
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The Economic Times, Mumbai - December 26, 2011
With more competition and more cautious consumers, companies will need smart marketing moves It is business plan season again. Most managers will argue for their new targets based on some rule of thumb linking overall market growth of their sector to GDP growth. Aiding them will be analysts’ views – mostly people who believe that all markets follow the same logic as the stock market – on whether consumer demand is ‘still strong’ or ‘softening’ based on quarterly results of companies and year-on-year comparisons. Using the health of consumer demand to assess the health of GDP growth, and using that, in turn, to predict consumer demand, is a bit confusing to some of us. Intuitively, the idea is sound that even with low GDP growth, companies can find healthy consumer demand for their business by persuading consumers to buy from them.. That is why our IT companies have healthy top […]
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