Understanding the Indian urban low income consumer

Abstract

Over 27.9% of households live in urban India which includes 25% of the country's poor. The population of India is growing at a rate of 1.4%, whereas the urban population has been growing at a rate of 2.8%1. The large segment of the urban low income consumer presents itself as a significant untapped opportunity to the marketers. Our study aims to help the marketer to get an insight into the consumption behavior of the urban low income consumer. Without such insights, marketers will fail to segment markets effectively and design strategies for effective market penetration. This will empower them to play a more active role in anticipating their needs and wants, in shaping their desires and aspirations, and in aiding them in the solution of their numerous day-to-day problems. This study makes two significant contributions. First, by studying the consumption behavior of the urban low income group, we provide an initial attempt to enhance our understanding. Secondly, we try to explore if there are any significant factors which lead to differing behaviors within this seemingly homogenous group. The research effort leads us to answer a few intriguing questions. Do education levels have a bearing on how they aspire, think, plan, decide, purchase, save and consume? Do they have favorite brands? What makes a brand tick with them? Are they loyal to them? Are advertisements effective in creating an impression on their minds?