Academic journal article Asia Pacific Journal of Management & Entrepreneurship Research

"Concurrent Diverse Positioning- A Strategy for Targeting Consumer India"

Academic journal article Asia Pacific Journal of Management & Entrepreneurship Research

"Concurrent Diverse Positioning- A Strategy for Targeting Consumer India"

Article excerpt

Introduction

India is one of the most important marketing destinations in the world. Not only because India's GDP on PPP basis is the third largest in the world and the median age of the Indian population is 26 years making it among the youngest in the world. And therefore marketers keen to grasp the opportunity India offers would do well to evolve marketing strategies that are unique to the Indian context.

Marketers can no longer try to apply concepts that have succeeded in the western economies in the Indian business environment. India's consumer market is large and growing. A population of 1.2 billion people with a population equivalent to Australia being added every year. By the tear 2030 the population of India will be 18% of the world's population.

India is a very poor country but the poor are not as poor as they used to be. In 1991 the per capita income of India was US$ 120. In 2005 the per capita income of India was US$ 700. The rich section of India's population is growing twice as fast as any other section (NCAER). The top ten percent of India's population by income has income levels at par with Brazil and 60% of that of Malayasia.In terms of numbers the top ten percent of India's population is five times the size of Australia and three times the size of Canada. Several Economies: The Indian market comprises of several economies. There is the new urban economy powered by IT, ITES and Business Process Outsourcing. This economy has substantial spending power and several of those employed in this sector command dollar earnings. Then there are large sections of the manufacturing economy, many sections of which are struggling under the burdens of overcapacity and stagnant demand. And finally there is the agricultural economy which is near destitute in several states of India. All the four sections of the economy consume modern FMCG products, and the same brands are consumed across sections.

Generation Segments: Then there are the generation segments. There are three generation segments in India. The first and the earliest are the Midnight's Children generation. These are the people born between 1940 and 1970. They have been raised in traditional Indian thinking which dictates that consumption is sin, one must live within one's means, taking loans is unadvisable. This mindset is born of financial uncertainty. The next generation segment is those born between 1970 and 1990. These people have been exposed to the old thinking in their childhood but have been exposed to post liberalization thinking in their adulthood. They tend to follow the advise of their families of orientation, their parental generation for themselves but do not actively advise their own children to follow the old ways. They have seen the benefits of new ways of consumption driven by financing, pledging future earnings for present consumption. They are less inclined to advise their young to save everything for the rainy day, to live as frugally as one can and be content with little. They may deprive themselves but aspire for higher standards of living for their children.

The third generation segment is the post liberalization generation born post 1990. These have witnessed the benefits of liberalization since birth. They have not seen shortages. They have been seeing ever growing prosperity among their peer group. They have easy acces to the best of education in India and overseas. They are eager to do well and live well.This generation, numbering over 400 million will drive consumption in the next two decades. Of these, 100 million will enter the workforce in the next five years and will be in a position to consume what they themselves earn.

As noted management thinker CK Prahlad said: While MNCs will change emerging markets - the reverse is also true - emerging markets will change MNCs - the way they think and do business.

Large marketing corporations including MNCs will have to rethink their business strategies to find innovative ways of penetrating the Indian market. …

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