THE RISE IN INDIAN CONSUMER

MARKET

m

m  

m   

m 



 Õ

Õ

 As rapid socio-economic changes sweep across

India, the country is witnessing the creation of
many new markets and a further expansion ones.
With over 300 million people moving up from the
category of rural poor to rural lower middle class
between 2005 and 2025, rural consumption
levels are expected to rise to current urban levels
by 2017.
 In recent scenario Indiaǯs economy has grown,
so too has the spending power of its citizens.
Real average household income in India has
roughly doubled over the past two decades.
£ Today India is likely to leap frog from being
the twelfth largest consumer market in the
world to become the fifth largest consumer
market in the world by 2025.
£ India continues on its current high growth
path, incomes will almost triple over the next
two decades, and the country will climb from
its position as the twelfth-largest consumer
market today to become the world's fifth-
largest consumer market by 2025.
  



£ In recent market scenario the Indian consumer market
frequently rises due to
a. increase in household income
b. changing in purchasing pattern.
£ This rise in Indian consumer market takes place in different
market segments i.e.
a. consumer durables,
b. FMCG
c. luxury products
d. Automobiles
e. health care
Therefore, a need is felt that some explorative study be
taken up to study the rise in Indian consumer market for
different market segments.

 

Õ

£ The Indian consumer market rises day by

day.
£ Increase in income is the major factor, which
is responsible for rising in Indian consumer
market.
£ Food chain and electronics are the segments
that are largely booms in the recent market
scenario.
 
Õ
£ To identify the market segment which is largely
booms in recent market scenario.
£ To identify the factors due to which Indian
consumer market rises.
£ To underline the significance of consumer market in
the success of business organization.
£ To bring out and suggests better ways of
maintaining the rise in Indian consumer market.
£ To understand the fundamental forces of long term
economic growth such as demographics,
urbanization and rising education level, will effect
growth in Indian income.


 
 
£ With the increase in Indian economy, the spending
power of citizens has also increase as real average
household income in India has roughly doubled over the
past two decades.

£ The recent data says ǮIndia has begun to develop into an

important consumer market with over 16.9 trillion Indian
rupees ($ 370 billion) in spending in 2008.ǯ

£ Studies have looked forward at most future

consumption products & services as
a. Automobiles
b. FMCGǯS,
c. luxury goods,
d. consumer durable goods etc..
  !
!"#!$Õ!"%

£ India has now entered a virtuous long-

term cycle in which rising incomes lead to
increasing consumption, which, in turn,
creates more business opportunities and
employment, further fuelling GDP and
income growth.
 Rising
income

Income Consum
Growth ption

Employ Business
Opportuniti
ment es



 
  

 Today various recessional impacts have engulfed worldǯs

economy which can be observed in:
a. falling Stock market
b. jobs in availability
c. companies following downsizing in the existing
available staff
d. cutting down of the perks and salary corrections
Thus recession have turned down the growth process &
also changed the consumer behaviors , attitude in the
current retail market .The customer has become more
loyal & they stick to the supermarket which gives them
value for money



£ Change in consumer behaviors and

purchasing power.

£ Stock Market is lingering in the

bottom.

£ Real estate market has started to

take a beating .
 Õ 

&

Segments of consumer market

£ Rural Consumers:
 FMCGs have seen over 20 per cent demand in
rural markets ahead of the 17-18 per cent growth
in urban India in categories like hair oils,
toothpastes, shampoos, skin creams and lotions,
and even candies saw more growth in rural
markets than urban.
 The overall number of rural households is
estimated to grow to 135 million in 2001-02.
 '%!(!"&)

 Indiaǯs Fast Moving Consumer Goods (FMCG)

reached a size of US$ 25 billion at retail sales in
2008 in field of Cosmetics, Plastic, Textile,
Clothing, Packaging & Containers etc..
 Reasons for growth:
a. Goods and Services Tax (GST)
b. Foreign Direct Investment (FDI)
 The Ministry of Food Processing Industries is also
planning to double the market size of the food
processing industry to US$ 165.1 billion by 2009-
10.
 * 

 With the rapidly increasing number of

millionaires in India, the market for luxury
brands is growing annually at a compound
average growth rate (CAGR) of about 35 per
cent.
 In field of products like Apple Laptops,
Furnishing, Diamond Jewellery, Vivel
Cosmetics etc.
  

 A durable good or a hard good is a good does not

quickly wear out, it yield services or utility over time
rather than being completely used up when used
once. Examples: Electronic equipments, House
ware, Cars.
 LG Electronics India Ltd (LGEIL) increased a growth
rate of 18 per cent in the last five months specially in
the refrigeration and AC segments.
 
Õ

 Presently, India is the second largest two-

wheeler market in the world, the fourth largest
commercial vehicle market, the 11th largest .

 Honda has identified India as the launch pad for

its global small car which will debut during the
next two to three years. passenger car market.


 Õ$

£ To assess the most emerging market segment a

survey of marketers was conducted. For this a
structured questionnaire was prepared to obtain
information about rise in Indian consumer market.

£ As per the questioner prepared the collected

information has been tabulated and analyzed to
draw results and conclusions which are as follows:
   !
p
 p 





p

p
1. Automobiles 8 16%

2. Garments 9 18%

3. Electronics 6 12%

4. Food chain 15 30%

5. Jewellery 12 24%

TOTAL 50 100%
ÕÕ Õ Õ  

p
 p




p

p

1. YES 47 94%

2. NO 3 6%

TOTAL 50 100%
  "
# $
p
  p
p




p

p
1. Increase in income 5 10%
2. Change in 5 10%
purchasing pattern
3. New trends 14 28%
4. Innovation 3 6%
5. Standard of Living 14 28%
6. Brand Loyalty 8 16%
7. Reduction in 1 2%
cutting jobs
TOTAL 50 100%
 #%  &'


p
 p p




p


p
1. YES 47 94%

2. NO 3 6%

TOTAL 50 100%
V ()   #%
$
p
  p
p




p

p
1. Competition 8 16%

2. Standard of 28 56%
living
3. Socio-cultural 7 14%
factors
4. Political factors 7 14%

TOTAL 50 100%
   $

p
 p






pp p

p
1. Electronics 6 12%

2. Garments 9 18%

3. Automobiles 8 16%

4. Food chain 17 34%

5. Jewellery 10 20%

TOTAL 50 100%



*)m



 The testing of hypothesis is based on the analysis of survey,

the evaluated results are as follows:

1. The hypothesis ǮThere is rise in Indian consumer marketǯ

proved to be correct.
2. The second hypothesis ǮIncrease in income is the major
factor, responsible for rise in Indian consumer marketǯ
proved correct with this new trends & standard of living are
also responsible as per marketers.
3. The third hypothesis ǮFood chain and electronics are the
segments that are largely boom in the recent market
scenarioǯ proved incorrect. The survey result says that Food
chain and jewellery are the segments that are largely
booms.
 &&
Õ $ Õ 
 The study has brought home that the rise in Indian consumer
market reflects the rise in different market segments due to
various factors i.e. new trends, standard of living, brand
loyalty, increase in income etc.. following suggestions can be
forwarded:

£ Todayǯs consumers are more brands loyal and seek towards

new trends, so marketers should make their efforts towards
these factors.

£ The new marketers should make their investments in

recently growing market segments i.e. food chain and
jewellery.

.
£ Marketers should make aware the customers
about the new policies formulated by them
which has adopted by any promotional tools.
£ It can convert their non-users into users by
the participation in local fairs & exhibitions as
it can increase the awareness about the
market & product.
£ Market services should be better improved by
paying more attention towards consumer
needs.
£ Consumer market should build its image as
the high value added services so as to have
the maximum share in the market.

£ Marketers should provide fast and good

services and friendly behavior with
customers, if they want to exist in the market.
  
+
,,
,