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7/27/2019 CB Session 15
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CB Session 15
06/02/13
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More than 100 million people will
attend the 2013 Kumbha Mela
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Harvard Students to research
about Maha Kumbh Mela 2013
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Maha Kumbh Mela, considered the largest public gathering in the world, will be the subject of acase study at Harvard University, which will study the logistics and economics behind it and thepop-up mega-city that comes to life in Allahabad during the religious event.A team of faculty and students from Harvards Faculty of Arts and Sciences (FAS), School of Design,
Harvard Business School, School of Public Health, Harvard Medical School, Harvard Divinity Schooland Harvard Global Health Institute would travel to Allahabad for the project Mapping IndiasKumbh Mela.They would undertake different researches at the Maha Kumbh, which draws millions of pilgrimsfrom across the world every 12 years. Harvard said a temporary pop-up mega-city is created forthe Kumbh Mela that would house pilgrims and tourists for the over month-long duration of thereligious gathering. This city, laid out on a grid, is constructed and deconstructed within a
matter of weeks, it said.Creating this huge encampment entails multiple aspects of contemporary urbanism, including cityplanning and management, engineering and spatial zoning, an electricity grid, waterlines and sanitation systems, food and water distribution plans, hospitals and vaccinationcentres, police and fire stations, public gathering spaces, and stages for entertainmentsand plays, the university said.This is probably the first time that Harvard is doing something like this, where weve pulledtogether different disciplines in a way that all faculty and students are going to be together to
look at a phenomenon, Associate Director of Harvards South Asia Institute, Meena Hewett, said ina statement.The Harvard team would seek answers to the question of How on earth is an event ofthis size possible, city-based writer Logan Plaster, who would be part of the teamvisiting the Kumbh Mela, said. To fully grapple with this question, the scale of theKumbh needs to be put in perspective.
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Perception
Attitudes
LearningMotivation
Psychological
Influences
Promotion
Place
Product
Price
Marketing Mix
Reference Grps
FamilySocial class
Culture
Sociocultural
Influences
Type of purchase
Social surrounding
Physical
surrounding
Previous Experience
SituationalInfluences
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Language
Rural vs. Urban India
Rich vs. Poor Geographical diversity
Liberal vs. Conservative
Dimensions of Cultural Diversity in
India
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Diversity in Language, Religious
Customs, Beliefs 28 states, 22 languages and
numerous dialects spoken by people
Religious customs, rituals and beliefs vary
Different identities, ideologies, interests
Implication for Marketers
Communication & packaging in local language
Products need to be aligned with culture
There is a right way and wrong way for everything,
but that can change from place to place.
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Rural vs. Urban India 30% of the population live in urban areas.
70% live in rural areas
this means the majority of the market is spread across the
country.
Different income levels in rural and urban India. Rural customers attach more importance to functionality
while urban consumers give importance to aesthetics/
service parameters.
Implication for Marketers Implication for Marketers
Different marketing mix for both the markets
Mode of distribution/channels differs
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India Geographic Diversity
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China -> Opening up
Russia -> Collapse of the Soviet Union
Europe -> Formation of EU
Lib li ti I t O I di C lt
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Liberalizations Impact On Indian CultureFrom Towards
Genteel poverty
Contentment and stability
Learning to earn more
Striving to keep up with
others(Korea, China)
Swadeshi International ( Make world class
goods which can find export
markets)
Self-reliance (no matter what the
price to be paid)
Efficiency ( if its cheaper to buy,
dont make it)
Isolation/Aloofness Exposure to interaction with the
rest of the world
Ideology/Emotion Pragmatism/Rationality
Soft opinions(doing the popular
thing)
Biting the bullet(doing what has to
be done)
Obeying authority(eg governmentdictates) Freedom of choice ( eg a freemarket economy)
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Punishment, Guilt, Control(egCurbing consumption through
massive taxes on luxury goods)
Motivation/Positiveincentivization(eg stimulating
demand by cutting duties and
lowering interest rates)
Aiming for the lowest commondenominator (Garibi Hatao)
Aiming for the highest factor( egTake India to the 21st century- Rajiv
Gandhis signature tune
Protection (of the weak) Enabling people to become more
competitive)Scepticism about technology(may
not be suitable in our conditions)
Seeking and embracing
technology( We can lead the
world)
From Towards
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Culture
Culture is learned rather than being born with
Culture is manifested within boundaries of
acceptable behaviour
Transmitted from generation to generation.
Rituals practiced
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Culture
Consumer India is a federation of different
cultures that just happen to be sharing the
same geography and, to some extent, the
same history
EU
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Culture -> A set of basic values, perceptionsand behaviours adopted by a member of thesociety from family and other institutions
Cultural values are deep rooted India, because of its diversity has many sub
cultures
Multiplicity of languages and custom, differinggeographical features, different religions andfaith
Culture
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Manifestations of Indian culture ;
Modern lifestyles -> but values and beliefs
remain unchanged
Consumption patterns are heavily influenced
by our traditions and cultural diversity
Indian a land of people with lots of
aspirations, achievements and independent
feeling
Culture
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Traditional values in India :
Respecting elders, honouring heroes,
cherishing love.
Hospitality, tolerance, patience, adaptability
Accommodate differing beliefs, religions,
rituals
Culture
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Patriarchal society -> Patrilineal
Matriarchy -> Matrilineal
Culture
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Culture
Personal soap?
toothpaste?Family
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Popularity of family packs?
Toilet and detergent soaps come in packs of 3
Parle G -> pack of fives Maggie Noodles -> pack of two/four
Coke/Pepsi -> Two liter packs
Mineral water -> Five/Ten liters
Culture
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Popularity offamily packs
Toilet and detergent soaps come in packs of 3
Parle G -> pack of fives Maggie Noodles -> pack of two/four
Coke/Pepsi -> Two liter packs
Mineral water -> Five/Ten liters
Culture
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Contrasting palates
Bengali sweets Rossogullas, Sandesh
Andhra spicyness of food -> extra chilly
powder, green chillies and pickles
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Due to the many subcultures, consumer
behaviour varies in different parts of India
Subcultures
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Impact of culture on product
acceptance
Food market
Mc Donalds
KelloggsMaggi
Starbucks
Gl b l Gl l
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Global vs Glocal McDonalds uses 'Astrix and Oblix' in France, a very
famous historical cartoon.
In China, the Chinese restaurants all have big tables andit's very difficult to go on a date. McDonalds make tables
for two, so the couple has some privacy.
In India, where McDonalds is the typical 'family
restaurant -> it provides large tables. In Taiwan, they made VIP rooms, because the people like
privacy.
The local touch of the brand is also very remarkable:
McDonalds sells the Kiwi Burger inNew Zealand
Prosperity Burger in Malaysia
McKroket in the Netherlands
Croque McDo in France.
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Mc Donalds India
Entered India in 1996
Included many vegetarian items in their menu
Culture also had an impact on carefullychoosing the non-vegetarian menu
Adapted the menu to Indian palate by adding
spices and ingredients
Mc Aloo Tikki burger
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McDonalds also appreciated the consumption
style of the Indian consumers and their
mindset of having a maximum price limit
when they buy certain food items
Mc Donalds India
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Next for McDonald's: Vegetarian-Only
Restaurant AMRITSAR & JAMMU
Mc Donalds India What next?
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Kelloggs India
Kelloggs 1994 Entry into India
Indian consumption pattern for breakfast:
India has a diverse pattern of consumption ofbreakfast
Idli , Dosa , Roti , Puri , Parantha , Bread Butter Traditional delicacies -> More filling than a bowl of
cereals
Cereals are more sweet in taste
Cereals are consumed with cold milk Combining milk with cereals made them soggy and
spoilt the taste
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Maggi 2 minute noodles
Success of Maggi????
Failure of Kelloggs????
http://localhost/var/www/apps/conversion/tmp/scratch_3/OLD%20INDIAN%20ADs.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/OLD%20INDIAN%20ADs.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/OLD%20INDIAN%20ADs.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/OLD%20INDIAN%20ADs.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/OLD%20INDIAN%20ADs.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/OLD%20INDIAN%20ADs.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/OLD%20INDIAN%20ADs.flv7/27/2019 CB Session 15
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Starbucks
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Products as gift items
Godrej Storwel
Reliance Mobile
Vicco Turmeric Vanishing Cream
Titan
http://localhost/var/www/apps/conversion/tmp/scratch_3/Godrej%20Storewel%20-%20Marraige%20(1).flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Old%20Indian%20TV%20Ad-%20%20Vicco%20Turmeric%20Ayurvedic%20Cream%20(1).flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Titan%20watches-%20Advertisement%20(Tara%20Sharma--Wedding%20gift).flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Titan%20watches-%20Advertisement%20(Tara%20Sharma--Wedding%20gift).flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Old%20Indian%20TV%20Ad-%20%20Vicco%20Turmeric%20Ayurvedic%20Cream%20(1).flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Godrej%20Storewel%20-%20Marraige%20(1).flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Godrej%20Storewel%20-%20Marraige%20(1).flv7/27/2019 CB Session 15
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Ads catching up with new trends
Valentines Day cards
Bacardi -> Spirit of enjoyment
Close Up smile -> positioned towards
teenagers
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Rage among young smokers because the
positioning was in consonance with thechanging values The spirit of freedom.
Charms is the way you are . Symbolizing
Adventure, independence and a non-conformist attitude.
The jeans-like packaging added to this
attitude.
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The emotional bond between the mother andthe son :
Vicks Vaporub
Clinic Plus New Lifebuoy
Trupti Atta
Bharat Gas Kent RO
http://localhost/var/www/apps/conversion/tmp/scratch_3/Vicks%20Vaporub%20Commercial.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Clinic%20Plus%20Ad%20-%20India.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Clinic%20Plus%20Ad%20-%20India.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Vicks%20Vaporub%20Commercial.flvhttp://localhost/var/www/apps/conversion/tmp/scratch_3/Vicks%20Vaporub%20Commercial.flv7/27/2019 CB Session 15
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28 states
Every state has its own identity
Every community has a cultural DNA
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Mini India
Pockets of communities
Connaught Place -> Melting Pot
Food
Method of shopping: Emergence of shoppingmalls, redesigning of traditional shops to givethem a modern look.
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Marwaris -> Method of shopping
An uncommon buying behaviour
Women do not indulge in any kind of shopping or
acquisitionEven home furnishings, fabrics which are the
responsibility of women are purchased by men.
Wedding dresses, dowry -> decisions taken by thepaternal heads with minimal participation bywomen
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Hindus 52%
Muslims 24%
Christians 24% 91% literacy
Prosperous lifestyle
Transformed from agrarian to one of theleading consumer states
Larger disposable incomes
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Christians are a prosperous and influential
community as they manage a large number of
educational institutions schools, colleges,
management and engineering institutions,hospitals and publishing houses( Malayala
Manorama is owned by a Christian family)
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Lifestyle -> The trait of spending too much isnot a trait of Malyalees, but with increasingprosperity, the money is spent mainly on
construction activity Average man in Kerala is better off and has
higher purchasing power
Inequality between rich and poor in manyparts of India is not found in Kerala
Marketers target -> both affluent and MIG
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TN Brahmins is a monolith in their
consumption pattern vis--vis cuisines,
dressing and shopping behaviour
Middle class -> professional class
Saving mentality is highly prevalent, hence
luxurious items do not come under their
consumption purview
Choice Characteristics Motivations
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Dress Veg, Rice, Idli, Dosa,
Tamarind, Coconut,
Chutneys, Sambar, Curd
Predominantly rice-growing, hence staple
diet is rice and rice-based food products
Food 9 yard sari(preferably
cotton), silk for occasions
Climate hot, humid hence cotton provides
relief and gives comfort
Footwear Flat-footed
sandals(leather or
rubber)
Sandals go with cotton, while heels would
be a mismatch
Durable Appeal for gold and
diamond jewellery
Iyengar brahmins Risk averse people. Gold
is considered a safe investment with assured
returns
Method of
shopping
Prefer local shops to malls.
Malls for high-value items
Relationship building with the shopkeeper is the
main reason for this type of behaviour
Lifestyle God-fearing, orthodox. Old
generation does not prefer
eating outside. Do not spend
lavishly. Prefer bargain-
shopping at local shops
Traditional occupation priests. Hence
rituals and customs have been transferred
culturally from generation to generation
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Gujarati community owns the most motels in US Entrepreneurial spirit
Women are in sync with the stock market even if withlittle formal education
Travel all over the world with their own cooks Ensure they get their own vegetarian food exactly the
way they like it
Food is very important to them
Buy and store in bulk commodities like oil and rice andwhile they will spend in the kitchen, they are not readyto spend on beautification of their house
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Weekend chill out
Spend substantial sum on food
Though many are in staying alone category ->
ready to eat products are not popular
Burger, sandwiches, Lays, Bingo, Juices, CSD
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Gadgets
Ipod
Iphone
Mobile phone with camera
MP3
This segment is always looking trendy, hip andhappening
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Shopping for clothes seen as a leisure time
activity
Clothes -> style statement
Daring styles and premium brands
Allen Solly, Van Heusen, Louis Phillippe, Color
Plus, Arrow, Levis, Lee, Raymond.
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Shopping and acquisition methods Culture of visiting a mall as almost a weekend
ritual
Mall not only a place to shop but a place tohang out and to socialize
High impulse buying due to increased use of CCand the necessity to show a cool attitude in frontof friends
Stalls put up near hang-out places like pizzaoutlets and coffee shops to advertise productslike a Mac laptop
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Internet buying -> Mainly because of
convenience and choices
Party culture -> Promoted and encouraged by
employers -> led to a greater acceptance of
drinking as a lifestyle
Pubs and discotheques -> Popular places to
hang out on weekends and they account for asignificant amount of money spent
Indian Teenagers in contrast to
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Indian Teenagers in contrast to
Western Teenagers
Western teenagers Grew up in relative economic stability.
Confronted by new realities: drugs, AIDs, pollution, teenage
pregnancy, divorce, etc.
Less sheltered home environment and unstable family life. From young age itself learn to be independent and make their
own choices in life.
More independent and self-sufficient.
Focus early on things they believe would provide for a secureand happy life, like earning money, spending culture or
material possession and acquisition.
A more stressful life as self-esteem is vested in doing well in
multi-faceted roles.
Indian Teenagers in contrast to
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Indian teenagers Grew up in period of fast economic growth with good
prospects.
Confronted by new realities through the mass media butwith few real-life experiences.
Have more sheltered home environment and stable familylife. Youth live with family of origin until their marriage.
Are less independent and self-sufficient.
Are idealistic in their expectations and tend to deal only
with issues that touch them personally. Lead a less stressful life as achievement in studies is
paramount and other matters appear secondary.
Indian Teenagers in contrast to
Western Teenagers
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Changing shapes of income
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Changing shapes of income
distribution
Changes in shape herald changes in
consumption pattern
Centre of gravity or the reference point of
average consumer behavior also changes
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Urban income pyramid
Rural income pyramid
Lower < 1.5 lakhs
Lower Middle 1.5 3.4 lakhs
Middle 3.4 to 8 lakhs
Upper Middle 8 17 lakhs
Upper > 17 lakhs
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Urban Income distribution
Triangle Or Pyramid: Traditional poor country
Diamond : Less people at bottom and top
more in the middle
Cylinder standing on a narrow base : Equal
numbers in top four income groups and very
few at the lowest income group
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Change in consumption comfort and
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Change in consumption comfort and
aspiration levels
Actual visible consumption increase
1995-96 to 2002-03 sales of two-wheelers and
four-wheelers has more than doubled
Cellphones have multiplied by more than five
times
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Actual visible consumption increase
Best combination of functionality and status
enhancement Cellphone + Two wheeler
Nokia and Hero Honda have dropped price
thresholds offer real value propositions
Change in consumption comfort and
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Change in consumption comfort and
aspiration levels
Visible consumption breeds moreconsumption
Nothing breeds the desire to consume more
than consumption itself For someone who has not taken to the road of
consumption, there is less desire andaspiration to consume
Urban India has increased its ownership ofdurables quite significantly
Change in consumption comfort and
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Change in consumption comfort and
aspiration levels
A large enough consumption base now exists
to create a springboard for more consumption
Urban India has a sufficiently large
consumption base
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Adoption curve
Springboard ----------- Not Saturation
Change in consumption comfort and
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Step Change in consumer confidence
Belief that tomorrows income will be morethan todays
Rapid change in standard of living in justunder one generation
Visible steady progress in their homes and
homes around them -> Consumer andConsumption confidence
Step change for a billion consumers
Change in consumption comfort and
aspiration levels
Ch i ti f t d
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Affordability growth greater than income
growth
Increased pressure of competition -> increase
in performance and drop in prices + fallinginterest rates and easier consumer credit
Low-cost business learning improves
Change in consumption comfort andaspiration levels
Ch i ti f t d
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Increased comfort with borrowing Being in debt has always been an area of high
discomfort -> How did this change?
1. Confidence, past experience : Tomorrow will be
better than today2. Low interest rates
3. Popular concept of EMI -> Magically legitimizesborrowing
Live within your means -> Live beyond yourmeans
Change in consumption comfort andaspiration levels
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Average age of home loan takers has reduced
by 10 years in last 5 years
Increased comfort of lenders and borrowers
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Rampant rise in Aspiration :
Three factors that drive aspiration ->
Connectivity, Communication and Education
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Arjun Appadurai : Imagination is not about
individual escape. It is a collective social
activity. Informational sources are needed for
people to imagine a possible life, weave astory and a script around themselves and
place products in emerging sequences.
Imagination may not always lead to action,but it is a prelude to action.
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Rural India beyond Agriculture : Dependenceon agriculture, dependence on monsoons
Boom-and-bust cycles -> Fragile sentiments
In rural India Agricultural activity = Non-
agricultural activity
Non-agricultural HH have higher incomes
Dual-sector HH
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Understanding Indias demand
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g
structure
One of Indias leading scientists once said
The advantage of having such a large
population is that even if an infinitesimally
small percentage of Indians are goodscientists, it is still a larger number of
scientists than most smaller countries with
better education systems can boast of
A l i th t h l h
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Analysing the two wheeler reach
HIG 07mn HH 42% 3.8mn UM 18mn HH 25% 4.5mn
LM 63mn HH 10% 6.4mn
Low 66mn HH 2.7% 1.8mn
SUNSILK and Diapers
Indian market structure ->
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Premium-Popular-Discount
Premium-Popular-Discount
Rich-Middle-Low
% of population
by Income
National income
share %
Consumption
Expenditure
share %
Top 10% 34.1 30
Next 30% 36.1 36.6
Last 60% 29.7 33.4
Premium-Popular-Discount are Equal in number
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Initial assumption was that a large part of thepopular market would migrate to the
premium end -> Popular segment
manufacturers would die a slow and naturaldeath
Super
P i
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Discount
High-End
Discount
Popular
High-End
Popular
Mild
Premium
Premium
Premiu
Price
Performance
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Rich
Consuming Class
Climbers
Aspirants
Destitute
Rich vs. Poor:
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Different needs to fulfill
Rich vs. Poor:
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Different needs to fulfill
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Rich vs. Poor:
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Different needs to fulfill
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Consumer class : Value for Money
Judiciously balance benefit and price all the
time, -> make value-optimizing decisions
Cost benefit optimizers
High-end popular products
hard to seduce on imagery-oriented brand
benefits
Rich vs. Poor:
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Different needs to fulfill
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Rich vs. Poor:
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Different needs to fulfill
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Aspirants : new entrants into the consumptionarena
Low-price shampoo sachets, loose glucose
biscuits
They are occasional consumers, party
packers
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Destitute : not yet into consumption ofanything
Living hand to mouth
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Indian Consumers -> Under-dosers
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Popular theory is that changes in HHconsumption behaviour are happening rapidly
because women are working outside home
More financially independent
More assertive and driving the consumption
revolution
Working women facts
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Working women facts
23% of housewives in urban India have a joboutside home
42% of housewives in urban India have a job
outside home -> working in the fields
As HH get richer, proportion of women in
workforce falls
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The changing housewife
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The changing housewife
All working women are not the same Working Woman -> Just a job OR Career
Stay at home -> Housewives with a working
woman mindset Or Housewives Housewives with a working woman mindset
Driving change in India
CEOS of HH, Primary coaches of children,ensuring their success in the competitiveworld
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Indian Woman - The Forces of change
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Outdoor work :
Nuclear family + Absence of elders -> Brought
the onus of outdoor chores like paying utility
bills, school meetings, bank visits on thehousewife
This has lead to a new found confidence
Indian Woman The Forces of change
Indian Woman - The Forces of change
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Role Models : Reservation of seats for womenin Panchayats -> forefront of public decision
making domain
20000 women gram pradhans in UP alone All sectors offer role models and generations
are growing up with a clear focus on
education and careers
Indian Woman The Forces of change
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Final assessment
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Final assessment
Groups -> Predecided
Articles/Case study -> Predecided
40% -> Weightage presentation
60% -> Weightage Question & Answer
Every person would be asked one question
Presentation sequence -> 1 8
Date -> 15/03/13
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