Consumerism 22.

8/11/2019 Consumerism 22.

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CONSUMERISM

IN INDIA

AbhimanyuAbhishek Bansal

RohitRajan


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CONSUMERISM

The movement seeking to protect andinform consumers by requiring suchpractices as honest packaging andadvertising, product guarantees, andimproved safety standards.

Consumerism also refers tothe consumption of goods at a higherrate.


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Consumption trends in India have been changed significantly

This is no longer the India of Gandhi,which was famous forhis simplicity and austerity. The change in values, habits,and

lifestyles in Indian consumer, not just from Gandhi's day, but

from a decade ago--is undeniable

Now we have , inside the malls, young people in Reeboks

sipped coffee at Barista Coffee, the Starbucks of India. They

wandered through Indian department stores and stopped for

snacks at McDonald's and Subway


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CONSUMER MARKETS

Retail

Estimates by the Retailers Association of India (RAI), the apex body of organised,

modern retailers, have shown that the country's US$ 21.05 billion organised

retail segment has grown 20 per cent in the September quarter 2009-10.

Rural ConsumersAccording to Calcutta Management Association Rural Marketing Meet, over 300

million people would move up from the category of rural poor to rural lower

middle class between 2005 and 2025 and rural consumption levels are expected

to rise to current urban levels by 2017.

FMCG

According to a FICCI-Techno park report, despite the economic slowdown,

India's fast moving consumer goods (FMCG) sector is poised to reach US$ 74

billion by 2018.


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Luxury Products

The country's largest real estate developer, DLF, sold luxurious apartments

worth US$ 219.1 million in December 2009the company's highest

monthly sales in its history.

Indian luxury market is expected to reach $450 million.

The Indian car market is seeing big-ticket launches luxurious cars such as

sports utility vehicles (SUVs); new launches include those by Tata Motors,

Toyota, Skoda, BMW, Mercedes, Renault, Mahindra and Jaguar.

Consumer Durables

A combination of changing lifestyles, higher disposable income, greater

product awareness and affordable pricing have been instrumental in

changing the pattern and amount of consumer expenditure leading to

strong growth in the consumer durables industry.In 2009, overall industry sales of LCD televisions grew by 93-94 per cent

over the earlier year. Multimedia mobile phones have grown from 800,000

units in 2008 to 1.8 million in 2009.


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Automobiles

The year 2009 saw the Indian automobile industry post significant export

growth and launch new models for the domestic market, bucking the

trend of most global automobile majors in the year. Experts maintain thatduring 2009, the car market grew 15 per cent over the previous year and

that similar numbers were expected for 2010.

According to a report by the global rating firm, Fitch, the Indian

automobile industry saw a growth of 10-12 per cent in sales in 2010.


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FACTS TO BE NOTICED

McKinsey global has released its India consumer research :

Indian income will triple over the next two decades.

The rise in average disposable income has made India the 12th largest

consumer economy in the world.

Over the next two decades, the countrys middle class will grow from

about 5 percent of the population to more than 40 percent and create the

worldsfifth-largest consumer market.

Today 57 percent of private spending is spread across rural areas, but by

2025 cities will command 62 percent of the countrys spending power.

In 2007 private spending reached about 17 trillion Indian rupees,

accounting for more than 60 percent of Indias GDP, so in this respectthe

country is closer to developed economies such as Japan and the United

Statesthan are China and other fast-growing emerging markets in Asia.

India remains the least urbanizedof the emerging Asian economies. Today

only 29 percent of Indians live in cities


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Accelerating Household Income in India

Average household disposable income

SOURCE : Mckinsey Global Institute


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India - a large consumer goods spender:

An average Indian spends around 40% of his income on groceries and 8% on

personal care products. A larger part of the total spending pie along with a

large base (in terms of population) makes India one of the largest FMCGmarkets.


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Consumer Protection Act 1986 (Copra)

Copra is one of the most progressive and comprehensive piece of

legislations enacted for the protection of consumers. It was enacted afterin-depth study of consumer protection laws in a number of countries and

in consultation with representatives of consumers, trade and industry and

extensive discussions within the Government.

Merits

Simplicity, straightforwardness and inexpensiveness.

Swift disposal of disputes.

Comprehensible to layman.

Easily accessible. Consumer welfare oriented.


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EFFECTS OF CONSUMERISM

Consumerism is appreciated in Western economies since a persons

standard of living is valued by his or her material possessions. There arecertain positive effects such as:

Positive Consumerism Effects:

More industrial production.

A higher growth rate economy.

More goods and services available.

More advertising since goods manufactured have to be sold.

Increased production will result in more employment opportunities.

A variety of goods and services to choose from.

More comforts for a better living style.


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Negative Consumerism Effects:

Craving for goods is high. The wants and desires of the people increase.The better their income, the better their purchasing power. But in case,

they are not able to do so, then they feel dissatisfied.

Over-dependence on labour saving devices.

Crime rate also increases as wants to possess expensive gadgets increase.

Thefts become common and daylight robberies take place.

Personal relationships also get affected as people are busy trying to earn

more to maintain their standard of living.

Consumerism has also resulted in ecological imbalances. The natural

habitat is being destroyed to create more goods and build more buildings

affecting the weather. Global warming will eventually result in health

problems. Industrial pollution is affecting people in many ways.

Consumerism is also depleting the natural resources of the respective

country.


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Consumerism 22.

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