The DNA of Consumer India will remain unscathed after covid-19
Business Strategy

The DNA of Consumer India will remain unscathed after covid-19

Investors are well-advised to track the supply side as carefully as they are tracking the consumer side CoronavirusCovid-19 Marketers and investors are increasingly wondering how consumption will change post covid-19 and the lockdown. The obvious answer is that everyone is going to be less well off, and consumption will shrink. In an earlier column we modelled the amount at risk. People will spend on necessities first (could include replacing a broken phone or refrigerator, not just food and school fees). For getting a piece of the “nice to have but can do without” expenditure, there will be a fierce cross category battle (buy an iPhone now, paint your house next year or downsize the wedding and give the newlyweds a car instead). The Indian consumer toggles seamlessly between ‘stretch’ and ‘settle’ behaviour—in good times, “whatever I can afford plus one price-performance level up” (stretch) and in bad times “let’s stay […]

May 11, 2020 0 Comments
Wider cost-benefit analysis will determine if WFH is a success
Business Strategy

Wider cost-benefit analysis will determine if WFH is a success

The current narrative around WFH does not accommodate diverse income groups and women workers. The bandwagon of opinion that work-from-home is the amrit (nectar of immortality) that the covid manthan (churning) has yielded is growing and speeding down an implementation path that is long on profit-and-loss benefit and short on people-centricity. Corporates love the cost savings, but a fuller analysis will show that it is a double-edged sword to be handled with care, quickly accruing quantifiable savings for companies, but risking slowly accumulating costs for employees and organizations, perhaps not quantifiable early on but not un-measurable. Implement work from home (WFH) by all means, but after data-driven weighing of costs and benefits all around. We would like to see an equivalent level of discussion on the people dimension as we are seeing on cost savings. Decision-makers, likely older, with older children, better paid, hence living in larger houses with better […]

May 4, 2020 0 Comments
Only half of India’s household consumption will come through post covid
Business Strategy

Only half of India’s household consumption will come through post covid

The so-called middle class, which is actually India’s richest 20% of households, accounts for 36% of consumption expenditure. India’s household consumer demand is vulnerable and skittish because of dismal occupation demographics, lowly paid and uncertain livelihoods for most Low food inflation and protection of urban salaried jobs may make it better, a spoilt agricultural season may make it worse The ongoing discussion on the prognosis for consumer demand is currently based on extrapolations from supply-side data and macro-economic variables. This column aims to supplement it by providing household-level data on consumption, a “people-view” of those who cause this demand to happen. India’s household consumer demand, the jewel in its gross domestic product (GDP) crown, is vulnerable and skittish because of dismal occupation demographics, lowly paid and uncertain livelihoods for most; and because most Indian households have very little “surplus income”, money remaining after covering their routine expenditure, leave alone their […]

April 20, 2020 0 Comments
Loss of income; ground-up assessment of recovery support to households
Business Strategy

Loss of income; ground-up assessment of recovery support to households

Based on household-level data on occupation and income, a calculation for helping citizens get to their feet A labourer carries vegetables in sacks at a vegetables market during the nationwide lockdown imposed to contain the spread of the COVID-19, in Chennai, Monday, April 6, 2020. (PTI Photo) This column offers a ‘people view’ — household-level data — of Indian households to feed into the ongoing macro-level discussion about the right level of financial support needed to help citizens get to their feet following the loss of income caused by the lockdown, and where it should be deployed.. Presented here is a ground-up calculation based on what categories of jobs and job arrangements mainly contribute to the income of households, and what that actual income level is. Macro-level discussions are based on a broadbrush understanding of occupation — large swathes of informality, agriculture dependence and migrants. We base our assessment on […]

April 12, 2020 0 Comments
Why India needs its own definition of what it means to be a ‘millennial’
Business Strategy

Why India needs its own definition of what it means to be a ‘millennial’

Millennials are 30% of the population and have fuelled India’s consumption growth more than any other generation (Photo: Ramesh Pathania/Mint) In India, Gen Z should be called Digizens. None of them know the India that was before Y2K Topics Indian Millennial Millennials are an age cohort conceived in America as those born between 1981 and 1996. In an article Defining Generations: Where Millennials end and Generation Z Begins, Pew Research says that “cut-offs of ages aren’t an exact science, but tools for allowing analysis, yet not arbitrary, and based on political, economic, social factors”. This means that before we adopt the American construct of “millennials” as a relevant tool for analysis, we need to test whether, by this definition, it makes sense to do so. And if not, what do we use then? The markers for American millennials include being “old enough to grasp the historical significance of 9/11”, growing up […]

December 31, 2019 0 Comments
A More Efficient Bharat
Business Strategy

A More Efficient Bharat

Rural India has already powered India’s domestic consumption growth for over a decade now and accounts for over half of Indian household spends 17 April, 2017 by Rama Bijapurkar Rural India has already powered India’s domestic consumption growth for over a decade now and accounts for over half of Indian household spends. In many states rural growth has far surpassed urban growth and the difference between urban and rural spending has been narrowing steadily. So why all the sudden excitement and buzz these last two years, about tier-2 and tier-3 towns’ consumption zooming, and about Bharat powering India’s growth? Probably because this story is being told from the supply side and the average supplier, who is not HUL or Airtel or Pepsi, has finally ventured into seriously addressing these towns and has been pleasantly surprised at the response from them (and more response begets more marketing effort and a virtuous […]

April 1, 2017 0 Comments
Marketers must revise their rural marketing formula based on hard facts, say consultants
Business Strategy

Marketers must revise their rural marketing formula based on hard facts, say consultants

By: Rama Bijapurkar and Rajesh Shukla Rural consumption expenditure is 56% of all India expenditure as we speak, and growing faster. So is rural marketing as we once knew it dead? Some marketers say that in their experience the rural-urban divide is blurring, and the whole idea of rural marketing as we knew it (haats, wall paintings, mobile vans, paisa packs, street corner demos on benefits and methods of usage, etc.) are now obsolete; that media, physical distribution, exposure to the world, income levels, access to ecommerce have drastically improved, so let’s officially end the era of specialists in rural markets. This is true if you drive through many of the more developed states with easy road and public and private transport connectivity to the nearest large town with jobs, more rural educational facilities and higher incomes thanks to non-agricultural jobs and to better paying crops. Yet others have adopted the […]

March 18, 2015 0 Comments
Rediscover the Market Share Gene
Business Strategy

Rediscover the Market Share Gene

The slowdown is a time for companies to rediscover their core strengths to win customers over from others With the first sign of a slowdown in sales growth, the auto industry has reportedly petitioned the government for relief in the form of some excise duty concessions. They are not alone in this kind of thinking. Business targets have for quite some time now been moved up or down, based on what the economy will or will not grow at and what the sector is projected to grow at, almost suggesting that the job of chief of sales and marketing is with the government of India, and the job of fulfilment or delivery is with the individual companies. The government, it is felt, is responsible for doing things that will make the tide rise, and it will lift everyone, in proportion to the type of ship they have built. When market […]

September 24, 2012 0 Comments
Desi Geek’s Ideal
Business Strategy

Desi Geek’s Ideal

Integrity and intellect have been the cornerstones of Infosys’ journey as one of India’s most respected brands. BRANDS are often markers and symbols of major social transitions, and the Infosys brand is a multi-faceted one that encapsulates the transition from a socialist, closed India to a globally connected modern market economy. The Infosys brand is a representation of India’s journey from zero to hero on the global stage– from providing unskilled labour to the richer world to being a country of smart people who have higher order skills to service the IT needs of even the most advanced countries in the world. Just as the Apple brand is seen to represent the symbolic new frontiers of California and Silicon Valley, the Infosys brand represents the symbolic new frontiers of new India and the International Indian: A desi geek and not a westernized sophisticate, middle-class and understated not affluent and flamboyant; […]

September 1, 2011 0 Comments
IT major Infosys needs to sound more confident about its strategy
Business Strategy

IT major Infosys needs to sound more confident about its strategy

What’s wrong with Infosys? But wait, that’s not the right question. What’s right with Infosys and what’s wrong with it that it can’t better communicate what’s right – those are the right questions. To see why these are the right questions for a blue-chip company under so much scrutiny, a broader perspective is useful. It is not hard to recall all the strident criticism of Indian IT majors from industry watchers. That they were not “going up the value chain”, they were merely doing application development and maintenance (ADM), they were not creating products or intellectual property, they were not integrating with their clients’ businesses, they were just a mega labour arbitraging machine. But despite all the criticism it was a machine that was throwing up large and ever increasing amounts of free cash, the darling of the stock market, the definitive gold standard for businesses in India to benchmark […]

July 15, 2012 0 Comments
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