Indian Families As Consumers - Juxtconsult 2009 Snapshot

Great Indian Families 2009 Understanding the Indian ‘Families’ as Consumption Units

A JuxtConsult – Indicus Analytics Joint Study

Correcting a basic market research anomaly! ¾ Consumers live their lives as ‘families’ and not households. And family consumptions get driven by the all the people living in them and not just by the ‘chief wage earner’ of the house ¾ How a family consumes gets defined as much by the ‘family composition’ and the ‘lifecycle stage’ the family is in, as by its socioeconomic status and the ‘ability to spend’ ¾ It is therefore important to ‘distinguish’ and understand families by their ‘member composition’ to target them appropriately

Topline Findings

The Marco Picture ¾ There are approx. 226 million families in India* (72 mn urban, 154 mn rural) ¾ The average family size varies from 1 to 6.9 depending on the family composition ¾ 25 mn Indian families (11% of all families) have more than 1 earning member ¾ 28 mn Indians (2.5%) prefer to read in English, marginally more than Malayalam. 50% of Indians preferring to read in English live in rural areas ¾ Average monthly family income in India is Rs.5,930 (‘per capita’ is Rs.1,350) ¾ 70% of all Indian families earn average to below-average incomes * accounting for approx. 1,112 million individuals (343 million urban and 769 million rural)

The Socio-Economic Landscape ¾

At 30%, highest proportion of families belong to SEC ‘R4’

¾

19.5 million families (27% of urban, or 9% of all Indian families) belong to SEC ‘A’ and ‘B’

¾

Chief wage earners of 87% of SEC ‘A’ and 36% of SEC ‘B’ families are graduates

¾

No SEC ‘C’ and ‘R1’ chief wage earners are graduates. But 15% SEC ‘C’ families and 22% SEC ‘R1’ families have a graduate member within the household

¾

Clearly then, defining the socio-economic status (SEC) of a household using education level of the ‘chief wage earner’ is losing its meaning and can often mislead Time to look beyond the ‘urban-rural’ divide, and the ‘chief wage earner’ driven SEC definitions to understand families as consumption units!

The Real Socio-Economic Ladder by Incomes Monthly ‘Per Capita’ Family Income Ratios

SEC ‘R4’

¾

1

(Rs.830)

SEC ‘R3’

¾

1.1

times of R4

SEC ‘E’

¾

1.2

”

SEC ‘D’

¾

1.4

”

SEC ‘R2’

¾

1.6

”

SEC ‘C’

¾

1.8

”

SEC ‘R1’

¾

2.3

”

SEC ‘B’

¾

3.0

”

SEC ‘A’

¾

5.3

”

The New Indian Consumer Pyramid 131 million families (634 million individuals)

Tier 3 The Underprivileged

44 million families (217 million individuals)

Tier 2 The Aspiring Class

SEC D SEC E SEC R3

SEC A SEC C

SEC B

SEC R2

SEC R1

SEC R4

51 million families (260 million individuals)

* Total – 226 million families (1,112 million individuals)

Tier 1 The Consuming Class

Looking at Families by ‘Lifecycle’ Stage ¾ 51% Indians are married. But only 1 in 5 Indian family (21%) is a 3-generation joint family, or ‘Dynasties’ ¾ An equal proportion of Indian families (21%) are ‘Baby Sitters’ - with the eldest child below 12 years in age ¾ The majority 45% of Indian families are ‘Maturing Mentors’, or families with the youngest child above 12 years in age ¾ Young married couples without any children, the ‘Nest Builders’, account for only 7% of all Indian families ¾ The single independents, or ‘Free Birds’, account for only 1.3% of all Indian families

Glimpse of their Socio-Economic Status…. ¾ Dynasties have the highest average monthly family incomes (Rs. 6,530). But they have the lowest average ‘per capita’ monthly incomes (Rs.975) ¾ Free birds show the second highest average monthly family incomes (Rs.6,385), and the highest average ‘per capita’ monthly incomes (Rs.6,385)* ¾ Rented accommodation is highest among Free Birds (at 35%). Dynasties show the highest incidence of ‘inherited’ property (at 74%) ¾ Automobile ownership (both cars and 2-wheelers) is highest among Dynasties ¾ Preference for reading in English is relatively highest among ‘Free Birds’ (6%) and lowest among ‘Dynasties’ (0.5%) * Note – Sample of ‘Free Bird’ segment relatively low for high statistical accuracy of its segment level findings

How a Family Rupee is being Spent! Household Consumption Head

Distribution of Spends (%) Families Who Spend on Them*

All Families**

Basic food and clothing

55%

55%

Rent and utilities

12%

5%

Transport and conveyance

12%

11%

Loan and other regular liabilities

11%

3%

Leisure and entertainment

11%

9%

Saving and investment

15%

11%

Other unclassified spends

13%

6%

Note - Not all families spend money on all heads

* Taken on valid households base, so doesn’t add up to 100%. ** Taken on all households base, so adds up to 100%.

Physical Asset Ownerships! % Families Owning

% Families Owning

(Urban)

(All India)

Home

65%

86%

Any TV

91%

86%

Color TV

79%

63%

C&S Connection

69%

56%

Any Phone

66%

50%

Mobile Phone

64%

48%

Any Automobile

42%

32%

3.5%

2%

2-wheeler

41%

31%

Fridge

35%

22%

Washing Machine

14%

7%

Computer/Laptop

10%

4.5%

2%

0.8%

Household Asset

Car

Air Conditioner

Home + Automobile = 27% urban and 25% all India

Financial Asset Ownerships! % Families Owning

% Families Owning

(Urban)

(All India)

Bank Account

59%

58%

Life Insurance

26%

23%

Debit Card

16%

9%

FD/Bonds

10%

5%

Credit Card

4%

2%

Medical Insurance/CGHS

4%

2%

Mutual Funds/Shares

3%

1%

Financial Asset

Home + Bank Account = 28% urban and 41% all India Home + Life Insurance = 12% urban and 16% all India

Types of Assets! Cars

% Families Owning

Bikes

% Families Owning

Small Car (<4 lakhs)

68%

100cc or less

48%

Mid Size Car (4-8 lakhs)

29%

125cc

39%

Premium Car (8-14 lakhs)

5%

150cc

11%

Luxury Car (>14 lakhs)

1%

180cc or above

TV Regular Flat 21 inch or less

% Families Owning 88%

Regular Flat > 21 inch

11.5%

LCD & Other Premium

0.5%

* All India Figures. May add up to more than 100% because of multiple ownerships

Washing Machine

3%

% Families Owning

Semi-automatic

78%

Automatic

22%

Types of Assets! Fridge

% Families Owning

Single door

89%

Double door

11%

Mobile Connection

% Families Owning

Pre-paid

95%

Post-paid

5%

Mobile Phone Features

% Families Owning

Color Screen

82%

Games

78%

FM Radio

49%

Any Camera

16%

MP3 Player

12%

Bluetooth

10%

Video recording

9%

GPRS

7%

GSM

75%

Extended memory

4%

CDMA

11%

Touch Screen

4%

Can’t Say

14%

Wi-fi

1%

* All India Figures. May add up to more than 100% because of multiple ownerships

Types of Assets! Size of House

% Families Owning

Mobile Services Used

% Families Owning

Less than 250 sq.ft.

21%

Roaming National

250 – 500 sq.ft.

36%

ISD Calling

6%

500 – 1,000 sq.ft.

27%

MMS

4%

1,000 – 1,500 sq.ft.

9%

GPRS

4%

1,500 sq.ft. and above

7%

GPS

1%

Roaming International

Credit Card

% Families Owning

Co-branded

20%

Silver

53%

Gold

27%

Platinum/Titanium

5%

* All India Figures. May add up to more than 100% because of multiple ownerships

64%

0.3%

Glimpse of Segment Level Findings…. ¾

35% urban families live in a rented house. Only 5% rural families do so

¾

38% of SEC ‘A’ families live in 1,000 sq.ft. plus house

¾

Only 2.5% urban families have a home loan running currently

¾

54% small car ownership and 57% motorcycle ownership is in rural India

¾

24% SEC ‘A’ families have a car, only 6% SEC ‘R1’ households own a car. But in absolute numbers, while SEC ‘A’ own 1.58 mn cars SEC ‘R1’ own 1.66 mn cars

¾

3 out of 4 car owners also own a 2-wheeler. Only 5% of 2-wheeler owners also own a car

¾

The average monthly family income of a ‘small car’ owning family is 2.1 times higher than a ‘motorcycle’ owning family; that of a ‘premium car’ owning family is 3.8 times higher than a ‘motorcycle’ owning family

¾

‘Maturing Mentors’ have the highest proportionate ownership of mid size cars (at 33%), ‘Vintage Wines’ of small cars (at 88%)

Top 5 Biggest Communities in India Top 5 Urban Communities

% of Urban Families

Top 5 Rural Communities

% of Rural Families

Gujarati

16%

Telugu

9%

Awadhi UP

12%

Marathi

8%

Telugu

12%

Tamil

8%

Kannada

11%

Non-Awadhi UP

6%

Marathi

7%

Punjabi

6%

A Glimpse of Segment Level Findings…. ¾

Highest per capita monthly income is among Kannads (Rs.2,190) and lowest among the Bihari Hindis (Rs.730)

¾

Marwari community shows the highest proportionate spend on ‘loans and liabilities’ (at 15.4%). Telugu community shows the highest proportionate spend on ‘savings and investment’ (at 20.7%)

¾

Gujaratis and Marwaris show the highest ownership of ‘any automobile’ (at 43% and 39%). Assamese show the highest penetration of cars at 7%

¾

Tamils and Kannads have the highest penetration of color TV (at 89%)

¾

Punjabis have the highest penetration of fridge at 56%

¾

Telugus have the highest penetration of air conditioners at 4%

¾

Kannads and Gujaratis have the highest penetration of mobile phones at 68% and 66%

Media Usage Status Families Using At Home

Individuals Using At Home

% Spending More than 1 Hour Daily

In millions (All India)

In millions (All India)

Weekday (All India)

Television

187

613

43%

Newspaper

104

361

10%

85

274

27%

8

20

32%

Media

Radio Internet

¾

‘Vintage Wines’ are the relatively heaviest watchers of TV. So are Marathis, Telugus and Tamils among communities

¾

‘Nest Builders’ are the relatively heaviest listeners of radio. Among communities, Telugus, Delhi Hindis and Gujaratis stand out

¾

Oriya and MP Hindi communities are significantly heavier readers of newspaper

¾

‘Baby Sitters’ are the relatively heaviest users of internet from home

Report Details

List Of Reports Possible Segment Reports: 1.

Families by member composition

Possible Category Reports: 1.

Family Profiles by Type of Car

2.

Family Profiles by Type of Bike

3.

Family Profiles by Type of TV

Vintage Wines (middle age/elderly married couple living alone)

4.

Family Profiles by Type of TV Connection

2.

Urban vis-à-vis Rural Families

5.

Family Profiles by Type of Fridge

3.

Single vis-à-vis Multiple Income Families

6.

Family Profiles by Type of Washing Machine

4.

Families by Socio-Economic Classes

5.

Families by Community Types (marwari, gujrati, punjabi,….)

7.

Family Profiles by Type of Mobile Phone

6.

Family Profiles by Most Expensive Vehicle Owned

8.

Family Profiles by Mobile Service

7.

Family Profiles by Size of House

9.

Family Profiles by Type of Credit Card

Free Birds (single independents) Nest Builders (young married couple with no children) Baby Sitters (married with eldest child below 12 years) Mature Mentors (married with youngest child above 12 years) Dynasties (3 generation joint family)

(both urban &rural SEC)

Note: Segment level analysis in any of the reports is subject to collection of sufficient sample responses at the segment level.

Pricing of Reports Report

Price (Rs.)*

Price (USD)

* 12.36% service tax extra

Any 1 Report

150,000

4,750

3 or More Reports

100,000 each

3,500 each

•

Payment Terms

: 50% advance, 50% after delivery of all reports

•

Delivery Timeline

: Single/First Report – 10 days from date of order (or immediately if ready) : Subsequent Reports – 10 days per report thereafter (or immediately if ready)

•

Report Delivery Format

: PDF

Information Coverage ¾ Demographic and socio-economic profile 9

Location – Town class (village class), region, community

9

Educational qualification, current occupation (and industry of occupation) of members in the household

9

SEC (urban, rural)

9

Gender, age, marital status, preferred language of reading of all members in the household

9

Income status and composition (monthly household income, income from outside, earning and dependent members)

9

Per-capita household income

¾ Consumption, asset ownership and liability profile 9

Share of expenditure by main household spending heads (food & clothing, rent & utilities, transport / conveyance, leisure & entertainment, loan & liability payments, savings & investments)

9

House ownership, size of house, no. of rooms

9

Vehicle ownership (bicycle, 2-wheeler, 4-wheeler)

9

Physical asset ownership – TV, fridge, washing machine, AC, microwave, music system, radio, DVD player, Ipod, video games, regular camera, digital camera, video recorder, tube well/pump, landline phone, mobile phone, computer, laptop, printer, TV connection

9

Financial asset ownership – land, bank account, demat account, fixed deposits, govt. bonds, chit fund deposits, life insurance, medical insurance, debit card, credit card, mutual fund, shares, etc

9

Currently running loan types if any

Information Coverage ¾ Quality of key asset ownership 9

Type of car

9

Type of bike

9

Type of TV

9

Type of TV connection

9

Type of fridge

9

Type of washing machine

9

Type of mobile phone

9

Type of mobile services subscribed to

9

Type of credit card possessed

¾ Media usage 9

Media used at home (TV, Newspaper, Radio, Internet)

9

Daily time spent on various media at home

9

Which medium relied on most for information for buying products and services

Methodology ¾ Large scale land survey conducted to profile the composition and consumption characteristics of Indian families. Survey covered over 16,000 households in 40 cities and over 12,000 households in 480 villages spread across all the four regions of the country ¾ Sampling methodology chosen to ensure coverage of ‘town’ and ‘village’ classes of all population strata, and ‘households’ of all socio-economic classification within each of these towns and villages. Villages sampling done in a way to ensure coverage of villages up to distances of 20 kms from the nearest surveyed town ¾ Finally, town/village class and socio-economic class combination level ‘weights’ were derived from authentic Govt. of India data and applied to the land survey data to make it representative of the entire Indian population

Thank You!