By Dheeraj Sinha (auth.)
Written through an insider, this e-book takes a serious examine the myths and contradictions surrounding India as a shopper industry, to ascertain the recent possibilities that it offers.
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Extra info for India Reloaded: Inside India’s Resurgent Consumer Market
The biggest mistake of mass-market thinking is its obsession with affordability without the context of aspiration. 1 23 The Trap of Mass-Market Thinking Mass-market thinking versus upgrade-market thinking Mass-Market Thinking Upgrade-Market Thinking Inspired by the bottom of the pyramid Inspired by consumer desire for upgrade "Less for less" innovation "More for less" innovation Price obsession Desirability and affordability equation High cost of reach out, low returns Value added products, better profitability One size fits all, subsidizes premium customers Opportunity for segmentation, rising premium segment Tata Nano, Maruti Suzuki, Nokia Micromax, M&M Utility Vehicles, Samsung What we need here is upgrade-market thinking.
All macro projections point toward a sharp growth in the luxury market in India. According to a CII-IMRB survey titled “The Changing Face of Luxury in India,” the luxury market was estimated at $10 billion in 2014 . Combine this with the fact that the net worth of the ultra HNIs (high net worth individuals) was estimated at Rs. 6 trillion) in the financial year 2013–14 and was expected to grow at an annual compound rate of 34% to Rs. 5 trillion) by the financial year 2018–19. A study by Kotak Wealth Management and Ernst & Young titled “Top of the Pyramid” estimates that almost 45% of the ultra HNIs are from non-metropolises and small towns .
This puts the need for relevance ahead of the need for differentiation. As far as the products are relevant to the needs of the people, they have a market. This phenomenon leads to flavor-driven marketing. If one brand is successful selling compact SUVs, every brand follows suit. As in this case, Renault Duster followed the success of Mahindra in SUVs, as did Ford Ecosport, setting on fire the Rs. 6 lakh-plus ($10,000-plus) compact SUV segment. These brands are selling because the Indian consumer has taken a fancy for compact SUVs, not because they are vastly differentiated from one another.