Source | www.bcg.com | Nimisha Jain
Trisha and Samir, a married couple in their early 30s, grew up in typical middle-class Indian households.1 Their circumstances as children were modest, and their families were extremely cautious with spending: the adults’ biggest dream was to move out of the rentals they were living in and buy their own homes. Trisha remembers her mother going to mandi (a fresh-vegetable market) every other day to get the best produce at the cheapest price. Both families’ major indulgence was the occasional getaway to hill stations—higher-elevation towns with cooler temperatures that are popular vacation spots in India.
But attitudes in India are changing as a consequence of rising incomes and of exposure to new ideas and technologies. For Trisha and Samir—and the tens of millions of Indians like them—the interest in spending on traditional things, such as the purchase of a home, has fallen. Increasingly, people are spending more on experiences, customized products, and time-saving services.
These trends are underscored in a new survey by Boston Consulting Group’s Center for Customer Insight (CCI). Seeking to shed light on consumer trends in urban parts of India, CCI surveyed people living in the biggest metro areas, as well as in tier 1, tier 2, and tier 3 cities. (See “A Survey Designed to Uncover Future Consumer Trends.”) The findings have implications for a wide variety of B2C companies that want to succeed in India, where the level of consumer spending is on track to become the world’s third highest within a decade.