But first let me make a start:
Downturn. India is said to have recovered from the downturn.
Yes. And not so sure. The major industries have: like the automobile sector, steel, IT to an extent etc, etc. But most of the masses lost their jobs in the small scale sector, real estate, middle east. These jobs are not so well accounted. Though there has been a recovery all around, to what extent still remains to be seen.
So what does this mean. Common people still do not have much to spend and are cautious, but sectors like automobile, computer hardware, white goods, high end cosmetics, etc have made a comeback. The middle class are also cautious. They are taking lesser risks. See the splurge in affordable housing, for instance. People want to make themselves secure, but are not redy to take huge risks. This is here to stay for quite sometime.
So what are the broad trends for 2010 in India, let me make an attempt.
MIND THE GAP: The common man
In 2009 the UPA (Comprises of the Congress party and allies) government,got re elected on a thumping margin , which was completely unexpected.
They were very focused on the 'Aam aadmi' , the common man, throughout their campign. What has won the hearts of the people were two programmes; the NREGA and the farm loan waiver. The mid day meal scheme for school children, which was run by some state governments even before, was centralised and extended to the whole country.
The farm loan waiver gave respite for a lot of farmers from debts, which traditionally cripple farmers, because they are left to the vagaries of nature like drought, and floods, lack of distribution, etc, etc.
Through the NREGA, National Rural Employment Guarantee Act, for the first time in independent India, the government takes some kind of responsibility for its citizens. It guarantees to give one person of a family 100 days of work, at a wage of Rs. 100 (roughly 2 dollars) a day. This is meagre, but it helps to keep the fire burning.
More than elevating hunger to an extent, it raised the minimum wages, which was denied to the poor landless farmers and other small time labourers. It benefited around 36 million households last year. There are issues like corruption, criticisms, etc but on the whole this is going to create a sea change in the rural society.
Now what is the trend and the future it unfolds?
Assuming that this scheme will lead to a cascading of work from 100 day to more, when the infrastructure and other projects will start based on what has been started by NREGA schemes. There will be an increase in the minimum wages, which has already started with landowning farmers complaining very bitterly about the scheme because of the higher wages it provide.
When people move just above the line of poverty and raise to a slightly better standard of living, do we have products and services to cater to them? There is a huge GAP here and it is high time companies and businesses start planning to fill this gap. Not just for the small local players but for large corporations as well, since the volumes are going to be huge. Right from toothpaste, toothbrush, sanitary products, services like power, communication...Products have to be created and new brands ushered in, so that it is possible to cater to high volume, low margin basic products. Companies like Unilever, P&G, Tata which already have a vast network can come up with new brands and products, so that it will not affect the higher margin brands.
Design thinking can play a major role in identifying opportunities here. The solutions may not be as simple as creating one product, but an effective product sevice network, so that innovative ways can be found to bring down costs.
The IDEO drinking water project, which was done in collaboration with the Acumen Fund is a an excellent example. With a participatory design process, which included the villagers and the community, very unique system level solutions were generated for each village/ community, by setting up a a central purifying center and distribution network thereby reducing costs for individuals substantially.
Mobile service providers and handset manufacturers can come together and create very unique customised local solutions.
SUPER REALISM: Caution, caution, caution.
MIND THE GAP: The common man
In 2009 the UPA (Comprises of the Congress party and allies) government,got re elected on a thumping margin , which was completely unexpected.
They were very focused on the 'Aam aadmi' , the common man, throughout their campign. What has won the hearts of the people were two programmes; the NREGA and the farm loan waiver. The mid day meal scheme for school children, which was run by some state governments even before, was centralised and extended to the whole country.
The farm loan waiver gave respite for a lot of farmers from debts, which traditionally cripple farmers, because they are left to the vagaries of nature like drought, and floods, lack of distribution, etc, etc.
Through the NREGA, National Rural Employment Guarantee Act, for the first time in independent India, the government takes some kind of responsibility for its citizens. It guarantees to give one person of a family 100 days of work, at a wage of Rs. 100 (roughly 2 dollars) a day. This is meagre, but it helps to keep the fire burning.
More than elevating hunger to an extent, it raised the minimum wages, which was denied to the poor landless farmers and other small time labourers. It benefited around 36 million households last year. There are issues like corruption, criticisms, etc but on the whole this is going to create a sea change in the rural society.
Now what is the trend and the future it unfolds?
Assuming that this scheme will lead to a cascading of work from 100 day to more, when the infrastructure and other projects will start based on what has been started by NREGA schemes. There will be an increase in the minimum wages, which has already started with landowning farmers complaining very bitterly about the scheme because of the higher wages it provide.
When people move just above the line of poverty and raise to a slightly better standard of living, do we have products and services to cater to them? There is a huge GAP here and it is high time companies and businesses start planning to fill this gap. Not just for the small local players but for large corporations as well, since the volumes are going to be huge. Right from toothpaste, toothbrush, sanitary products, services like power, communication...Products have to be created and new brands ushered in, so that it is possible to cater to high volume, low margin basic products. Companies like Unilever, P&G, Tata which already have a vast network can come up with new brands and products, so that it will not affect the higher margin brands.
Design thinking can play a major role in identifying opportunities here. The solutions may not be as simple as creating one product, but an effective product sevice network, so that innovative ways can be found to bring down costs.
The IDEO drinking water project, which was done in collaboration with the Acumen Fund is a an excellent example. With a participatory design process, which included the villagers and the community, very unique system level solutions were generated for each village/ community, by setting up a a central purifying center and distribution network thereby reducing costs for individuals substantially.
Mobile service providers and handset manufacturers can come together and create very unique customised local solutions.
SUPER REALISM: Caution, caution, caution.
People are cautious of wht they are spending on they have become super realistic. All lunches and dinners are accounted for. Some of the recent projects in Bangalore for affordable housing has found huge demand.Folkds want value for what they are spending on. The tariff plan of Tata Docomo, in which every second is a pulse in place of a minute and consumers have to pay only for what they use, has become a huge hit. To the extent SIM cards were sold in black.
So what does this mean to the industry and businesses: Show the value upfront. Tell the consumer what they are paying for and make it obvious. Is there a niche product to be created , you may well do, but show the benefit upfront.
CONVERSATION> INTERACTION
More and more marketers are looking at having a dialogue with the consumer, and even going to great lengths. Tata Docomo, a new entrant in GSM Mobile network in India, is asking talented, enthusiastic consumers to create their own animation commercials. Tata Docomo in turn runs these ads with credits to the creator. He or she will be thankfull and loyal to the company for a lifetime. Most of them will be a true talented animator working in some corner of an office. Perfumers are prompting clients to create their own scents, restaurateurs are inviting menus from the discerning patron. This has gone to the extent of becoming a fad and branding consultants are cautioning the businesses to not lose their focus.
Will this trend stay: Of course it has good potential. This is becoming the reality TV of advertising and sooner than later advertisers will have to find novel ways of engaging consumers. If possible, find ways to keep the engagement. This is gratification for the consumer as well. I could see the happiness on the face of the animator of one of the T-Docomo ads to believe it.
ME IN THE MIRROR
Suddenly you are told in your face that you are aging, you look darker, go run to the mirror and have a look at yourself! A sudden splurge in high end cosmetics, with glossy secondary packaging, lots of chrome and metal to stop every natural process, which are to happen, well naturally. And for men, every brand has a fairness cream and the affect is supposed to be measurable.
Though this trend seems to have been forced by advertisers. There definitely is a market for them. Which only shows there is a sizable amount of affluence and disposable incomes, which can be spent on products like this. Though wellness stores swelled in 2008, the brands and products grew a lot in 2009. We can expect to see more grooming products in the market, and also services, like fitness, spas, high end saloons, etc
ME IN THE MIRROR
Suddenly you are told in your face that you are aging, you look darker, go run to the mirror and have a look at yourself! A sudden splurge in high end cosmetics, with glossy secondary packaging, lots of chrome and metal to stop every natural process, which are to happen, well naturally. And for men, every brand has a fairness cream and the affect is supposed to be measurable.
Though this trend seems to have been forced by advertisers. There definitely is a market for them. Which only shows there is a sizable amount of affluence and disposable incomes, which can be spent on products like this. Though wellness stores swelled in 2008, the brands and products grew a lot in 2009. We can expect to see more grooming products in the market, and also services, like fitness, spas, high end saloons, etc
