What Ticks for Indian Consumers/ Family – Vikram Sakhuja and Mayank Shah

01 Oct,2014

Continuing with our extracts from the second edition of the MxMIndia Annual, we present contributions by Vikram Sakhuja and Mayank Shah.

 

‘There is a role for authenticity and brand differentiation coming in’

 

By Vikram Sakhuja

 

Where the current economic scenario is concerned, it is still a wait and watch situation. Some sectors are growing while some are not. Overall, we are not witnessing a boom like we witnessed a few years back where almost all sectors were doing very well. Inflation too, is a very worrying factor. What is more, interest rates are also preventing a major upswing in investments. The situation is likely to remain the same more or less till the elections in 2014. In my view, at least a lot of FDI decisions would wait till the elections.

 

Slowdown and consumerism

Consumerism is more a result of microeconomic factors. FMCG is still fine but if one looks at real estate or durables or any other high-ticket items where a loan is required, the high interest cost dampens consumerism. One needs to look at it sector by sector. Having said that, our fundamentals are strong and I do not see consumerism getting impacted in the long run.

 

Is India moving from collective to individualistic society?

It largely depends on what you feel are the manifestations of a collective versus individualistic society. If one is talking from a standpoint that living for self is individualistic, we are definitely not getting individualistic. As parents, Indians are concerned about the wellbeing of their children, their education and their future. They are also concerned about their elders. In India, the family value is at the heart of things, which makes it a collective society.

 

If one looks at the western society, be it Europe or the US – it is no doubt more individualistic. There the family values are not as strong as they are in this country. However, it is nothing that has happened in the last few years. It has been there for generations. So when it comes to collectivism verses individualism, the world is the same as it was three years ago.

 

Purchase decisions

For most of the household decisions, more so in the case of FMCGs, the housewife is the primary decision maker. In some cases, children and husband are influencers too. Meanwhile, the typical technology and durable decisions, for instance which two-wheeler to buy, would be almost entirely male driven.

 

Young adults of the house too play a key role in decisions related to technology products and vehicles etc. Who makes purchase decision in the family, and whether it is an individual decision or a collective one depends on the product category.

 

 

‘We are moving from a collective to an individualistic society’

 

By Mayank Shah

 

As we know it, the Indian consumer is evolving with every passing year. And in the years to come, their expectations are bound to grow exponentially. About 20 years back around pre liberalisation era consumers used to be happy in what they got – irrespective of whether it was good or bad. Today consumers have actually become kings, and five years down the line I envisage marketers chasing the consumer – where sample size would be equal to one. Marketers would have to look at offerings which would be tailor-made for each and every individual. We call it mass customization, where we customize our product in such a way that it appeals to everybody.

 

Rural and urban families

It is not that there is no difference in rural and urban families, but at a broader level they are not very different. Both are aspiring for better lifestyle, better products and better brands. Almost 80 to 90 per cent of their aspirations are similar. A guy in a city probably aspires for a luxury car and one in the rural area aspires for a car. Broadly the aspirations remain the same, though the brands and tag values might change.

 

It is only a matter of time that we would see the rural aspirations growing further. One finds urban people more individualistic primarily because there are more nuclear families in urban markets. It is not so much in the rural areas but they are moving towards it. From the days when there used to be a joint family comprising of 15-17 people, today there might be just about seveneight people meaning that the size of families are shrinking.

 

From collective to individualistic society

Definitely, we are moving from a collective to an individualistic society. We at Parle Products, do research on continuous basis – we study consumer behaviour. We have seen individualistic society as an emerging trend. People are more concerned about themselves today than ever before, their opinions matter a lot to themselves rather than opinion of others.

 

They are being more individualistic probably right from fulfilling their needs and wishes to expressing their opinions, feelings etc. The kind of change we have seen in the last ten years is phenomenal. We never had an option of using a different brand when we were small. One thing used to come for the entire family but today most things you buy are based on individual likes of family members.

 

 

Reaching various target groups

From a media perspective, the easiest to get is the housewife. By targeting mass TV or GEC, you can actually reach her in most cases. Youth is challenging primarily because of the amount of media they consume, especially now with the increasing consumption of online media. Challenge there is to engage and connect with the youth.

 

Challenge with men is sometimes just getting them because it is probably the toughest TG to target and reach without too much wastage. As for kids, it is quite easy to get them, but they do not have the purchasing power. There are very few categories like candies where they are the decision makers themselves. If you look at nourishment drinks and other products targeted at them, marketers have to typically talk to the mother as well. It is not enough to just talk to the kids.

 

Has the man’s role changed?

His role was always that of the provider and it is by and large unchanged if one looks at the mass markets. If one was to look at the upper skewed SECs – there it is now shared with a working wife. From that standpoint, his burden has come down but then accordingly, expectations that he would contribute to the household has increased. Moreover, the old stereotype of the alpha aggressive male has changed to well-balanced human beings who are capable of some kind of emotion.

 

Traditional media is not enough

Clearly, traditional media is not enough, though it still has a very important role to play. There is too much clutter, and too much brand proliferation there. Advertising expects people to connect with the ad, get the message, remember the brand and actually go through the entire purchase journey – that is getting challenging.

 

One cannot hold on to classic matrix and say is it enough to grow awareness. It is much more about the behavioural change. Increasingly, it is being felt that reaching mass audiences is not enough and there is a need to segment. One’s ability to segment and then target as laser sharp as possible is going to be a potential source of advantage. And this needs to be done across mediums.

 

There is a role for authenticity and brand differentiation coming in. At certain points in time, one finds that there are devices other than conventional advertising that do a great job. Take the case of Red Bull. They do not spend too much on conventional advertising but invest a lot in their online presence. It is an energy drink and to some extent it is about giving the adrenaline rush to do things. Their tag line is ‘It gives you wings’. The content they talk about, whether it is Formula One, or jumping from the edge of space or other such properties brings an authenticity to the brand which is way more than what advertising can do. Another good example is Dove Real Beauty.

 

It has done some fantastic work in recent times. From the 25 percent moisturizer inside the soap campaign many years back, it now talks about real beauty. It is not about the cosmetic model kind of beauty which is relatable to only a few, but about being comfortable in one’s skin and celebrating one’s own beauty. That insight has in fact become a platform which has worked very effectively across the globe, and not necessarily through a television ad. Digital platform plays an important role here.

 

Brands and consumer expectations

The initiative has to be taken by the brand to uncover new consumer expectations, and make them relevant. By and large, consumers are in equilibrium with what a category provides. The leads come from the minority e.g activist consumers making demands on wellness, authenticity or ethics in marketing; or heavy/passionate users of a brand or category who can serve as good barometers against overzealous brand managers who want to make changes in brands when in fact they are not required. Either way, the point is that a brand needs to remain closely connected with the consumer to ensure it meets and exceeds expectations.

 

– (As told to Ritu Midha)

 

Man’s role in the family

Man’s role in the family has changed tremendously, especially in the urban setting. Today in cities, it has become a necessity for both husband and wife to work and earn livelihood. From the days when women used to do all household chores, today they are more like partners; everything is shared right from work to responsibilities. As the rural families will realize the importance of women working, things will obviously change.

 

Most challenging target segment

Men are the most challenging segment to reach. They are really tough to catch as they are more out of home. It is not a difficult segment to crack but to reach. Reaching women is the easiest, followed by kids, teenagers, young adults and men in that sequence. Having said that, the kids segment is the most difficult to crack – their expectations are completely different. There is nothing like brand loyalty, they want to experiment. You have to keep re-inventing yourself every now and then and keep yourself relevant to them.

 

On top of that, from no influence or no decision making power a few years back to today, in the categories they are involved in, everything is decided by them. In categories which are meant for consumption of the family too they have a say. Parents also involve them in most other decision-making activities because they have good exposure, and at times it helps. For example, kids today are very techsavvy, so I would probably consult my kid if I want to buy a technology product.

 

A happy family

The values which made a happy family earlier are ageless and they remain the same. Twenty years back it was believed that family that eats together stays together. It is still the same and twenty years down the line it is going to remain the same. Some people believe that you can substitute quantity time with your kids with quality time. But I believe that your child needs your quality time. These values are timeless and there is nothing like giving time to your family. If you try to change it you might be so called family, but not a happy family.

 

FMCG consumption

We are still not a branded economy where we consume only brands; we consume a lot of commodities. The moment all food products consumed as commodities are branded, there would be quantum jump in the FMGC consumption. For instance, if you replace a kilogram of sugar that you buy loose with a kilogram of packaged sugar in the FMCG basket, it would change the scenario dramatically. The conversion that needs to happen from commodities to brands is slow.

 

Brands have not really been able to establish that they provide certain value when consumers buy them, hence the customer is not ready to pay the kind of premium they want to command. A few categories, of course, are exceptions. In biscuits, for instance, there was a time when we had significant unorganized segment and things were sold as commodity. Since then the unorganised segment has gone down and organised segment is increasing. Even in the snacks market, both Indian and western, a huge amount of conversion is happening from unorganised to organised segment.

 

They have been able to sell hygienically packed snacks without much price difference. There is assurance of quality and most importantly, it provides convenience. You can probably buy 25gm or 50 gm of snacks in a pouch or bag at a convenient price point of five or ten rupees. In an unbranded market, the same would not be available.

 

 

Next: Monday, October 6: Men– Haresh Nayak and Vikram Raichura

Related Stories

  • No Related Stories Found
Post a Comment 

Comments are closed.

Videos