Peeping into India’s Future
Economists and analysts have long predicted the coming of the ‘bulging middle’ — economic growth adding a whole new set of people to the consuming middle class. This phenomenon coupled with India’s most famous and forever quoted demographic dividend — most of us being below 30 years of age and therefore having long and productive careers ahead of us; poses interesting sets of questions and challenges for the marketer. In the course of this article I propose to look at couple of these challenges: Newer Expectations and Regional Identities.
This bulging boils down to one critical fact. Across categories, be it cars, or chocolates, or cheese you will find a new set of consumers who have had no ownership or usage history getting into these categories. These consumers do not necessarily have the same kind of expectations from the category as resident consumers have, their purchase journeys will be different and their understanding and perception of brands may not match those of resident consumers. Mobile phone handsets is a good example of what could happen when large numbers of new consumers enter the category for the first time. Penetration surged year on year and this boom utterly transformed not just the kind of phones India bought but also the displaced the brand that had hitherto ruled the Indian handsets market — Nokia.
Cars present an interesting contrast. Growth is on its way to being back on track. Penetration of cars on the other hand is amongst the lowest in the world. Only 15 out of 1000 Indians own cars. When you layer this fact with another the picture becomes really interesting. And this is that year on year 60% of all cars are purchased by people who have never owned cars before. The economic slowdown and stagnation that was seen in the car market did not affect the first time buyer’s share in the cars sold.
In a recent study that I was involved with we found that the first time car buyer’s understanding of cars is very limited. For instance there were many consumers who were confused about the country of origin of Volkswagen. Some saw Volkswagen as a Russian brand; few others saw it as a Chinese brand. One of the most interesting findings was that their approach to car purchase was similar to their approach to purchasing mobile phone handsets. They understood features. They were able to evaluate cars in terms of features and accessories but they did not understand technology. They could not make out what was fundamentally different about the various cars on offer. Purchases were also completely influenced by what their friends had to say about cars and what they owned. Content on cars either in blogs, boards or magazines was not very helpful. The only thing it did was to remind them how little they really understood cars. Technology and technicalities it seems are lapped up by the enthusiast but is turning off the newbie.
This eclectic mix of facts: low penetration, high share of purchase of first time buyers and their limited understanding of cars presents an interesting ‘to do’ list for marketers. Some of the more obvious ones are
- no brand can consider itself as established or well defined
- brands need to define their value proposition on a continuous basis
- brands need to find the simplest possible idioms and language to hold a conversation
- brands that demystify categories will gain more
- education is a vital investment
The opening up of the economy in 1991 was almost immediately followed by a big shift in the kind of conversations that brands were having with consumers. Most premium brands till then had conversed almost entirely in English. Advertising was all prim and proper but what was missing was cultural and emotional bonding. Indian idioms, Indian contexts and Indian ideas started making their appearance in the mid nineties. One can argue about if this was a mere coincidence or if there is an explainable phenomenon behind this shift. Could it be because categories that held limited appeal until now were now open to a wider set of consumers? Probably yes. Whatever might have been the reason Indian advertising got a lot more interesting and unexpected post the mid-nineties. Brands were now not just talking to consumers but were connecting with them in newer and more endearing ways.
This shift was however mostly restricted to one dominant Indian language and idioms largely from one part of India. As long as the main idea was conceived in Hindi or Hinglish and then translated into regional languages it was seen as a job well done. It would be interesting to ask if there will be further shifts with the ‘bulging middle’. Would large numbers of consumers coming from every part of India change the kind of conversations that brands are having with them?
What has been happening in Indian politics probably can give us an insight into what could happen to brand conversations. As we matured as a nation two things happened. Our federal structure grew stronger as did our regional aspirations. This led to tall regional leaders across the country who forged strong bonds with the electorate in almost every state.
The same could very well happen with brands. Wouldn’t consumers bond better with brands that are able to use local idioms and local cultural nuances to engage with them? A lot of states in India have populations bigger than most European countries. Most states; at least the ones in the south have thriving film industries and create cinema that taps into these very local idioms and cultural nuances. With the coming influx of new consumers across categories it would make financial sense to go beyond translated ideas and regional celebrities. Brands will then have the freedom to find an expression of their big idea rooted in local idioms and cultural nuances. And this much like our federal structure making us a stronger nation will also make for stronger brands.
The most clichéd take on the future is that the only thing certain about it is its inherent uncertainty. But there are a few things that are certain about India. Growth will happen and this growth will create newer consumers who in turn will question, challenge and demolish the status quo. And this makes for the most interesting of times for marketers.