Me, my life, my wallet 2018 - India summaryMe, my life, my wallet 1 2 India: Subcontinent of...

Me, my life, my wallet

1 2

India: Subcontinent of richness and complexitySoon to be the world’s most populous market, India holds great potential for companies ready to adapt and invest in the long term

It is true that this vast country of 1.3 billion is a complex mix of languages, religions, castes, professions, demographics and more. When viewed as a

consumer market, India is a varied and rich patchwork of communities, segments and cohorts.

From the perspective of the digital world, it is possible to fall into the trap of oversimplifying the same into two groups based on behaviour. To begin with, this may transcend some of the complexity, but it will not be the right way to view this consumer base in the medium to long term.

Outsiders are familiar with the first group. Connected Indians in the major cities have mobile as their way of life; they have restructured their life choices around digital services in the pursuit of convenience. These are the ones who dominate our online survey

that shows, for instance, tremendous enthusiasm for digital-only services, including virtual personal assistants, as well as digital and real-world hybrids, such as drone delivery, which will be invaluable in India’s crowded streets, if they can be made to work.

But there is avvnother Indian consumer, who will experience a greater revolution than even this. In the vast expanse of mainland India, consumers are getting

The Indian consumer is difficult to understand, and as the online revolution progresses beyond the big cities and starts gaining momentum in the country’s heartland, they are getting more complicated still. The rewards for companies who take time to learn, though, are substantial.

Arun M. Kumar, Chairman and CEO, KPMG in India


3 4

2019 electionsWith the upcoming parliamentary elections in 2019, India’s government has plenty of incentive to invest in infrastructure, both digital and physical, that will facilitate this broadening access. The government will continue to assist small and mid-sized businesses, for instance, and encourage the digitization of the agricultural sector that accounts for 50 percent of the workforce.

Also, several programs that started in the last few years, such as the Jan Dhan Yojana financial inclusion program, are maturing. All this fuels consumerism, and changes spending habits and buying behaviours of the mass population.

Rural economies are also being helped by new payment channels, which make it easier for young city dwellers to send funds to their families elsewhere. A breakthrough would be WhatsApp, the country’s most popular messaging app, adding wallet and payment services for its 200 million Indian users. This would make remittances easier, but would also mean families back in the villages would need to be online to receive funds, further broadening the digital reach into the country’s heartland.

It would be a mistake, however, to take services that have worked elsewhere and expect them to capture this vast market without a rethink. Indian motivations and life goals are unique, with time pressure a particular issue.

In our online poll, 51 percent of urban respondents said they worked 6 days a week, more than twice any other country polled. Urban Indians are increasingly cash rich but time poor, so a global retailer selling do-it-yourself furniture, for example, needs to think about adding a do-it-for-me option at additional cost. There is an increasing class of consumers who

new choices for the first time, with information at their fingertips that can break the information asymmetry that disenfranchised them as a customer for decades. This is a huge group as more than 80 percent of the population live outside the 10 largest urban centers.

“With digital services moving from the big cities into India’s heartland, the type of growth of the market will change,” said Abhijeet Ranade, partner and head of customer & channels, KPMG in India. “The consumer in a second-tier city will be very different to one in Mumbai and the rural consumer is different again. This makes the Indian market yet more complex.”

will also switch to brands that can deliver a personalized, multichannel experiences even if it means paying a little more.

Companies also need to understand consumption patterns. Some 44 percent of Indian survey respondents said they shop daily or biweekly, more than in any of the other countries. Corner stores that offer free, informal credit and a selection of products fine-tuned to neighbourhood tastes are a surprisingly formidable competitor to the big e-commerce platforms, especially with last-mile logistics remaining a problem in rural areas.

Increasingly, the giant online players realize that instead of competing, they need to leverage the strengths of this unique, 12-million-strong network of local stores, using them as delivery agents and places where unwanted products can be returned.

Digital entertainmentAmong the sectors seeing toughest competition is digital entertainment, with more than 20 players vying for attention. Telecom provider Reliance Jio, with its global and local tie-ups, has changed the way in which the populace use their phones. Local players with rights to Hindi blockbusters and the IPL cricket tournament that transfixes the nation in April and May, are going up against Netflix other major video streaming services.

A range of different business models including freemium and subscription only are competing, but whichever triumphs, the result will be the same: a wider adoption of digital services with some element of payment.

There are many other sectors where services have yet to scratch the surface of the vast potential, such as healthcare and education.

Our online survey showed Indian consumers are prepared to trust.

Banks, in particular, are seen as trustworthy institutions, with tech firms and telecoms providers not far behind. Trust, however, takes time to build, but just seconds to break.

Companies chasing what will soon be the world’s most populous market need to focus on the long, not short, term and make difficult choices on who they will serve and how they will be served, investing in supply chain and logistics to make it work seamlessly. Indian consumers are not forgiving because, more than ever, they have a choice.

Would rather lose:

2017 2018

57% 55%

These days, everything you can get it at home. You can do online shopping. Those guys will just come in, you can try the clothes and then you can send it back. I think convenience is the most important thing for me and it’s just followed by pricing.

Aanchal, 33, Bangalore

I used to watch whatever was on TV but now I can use my smartphone, and there are applications, I have Netflix. So, I’m more addicted than before.

Aakrity, 28, Gurgaon

© 2018 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. © 2018 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


5 6

1935 19751945 19851965 20051955 1995 20151940 1950 1970 19901960 1980 2000 2010 20201930

India STEP events

he India of yesteryear is in many ways becoming a distant memory. The arrival of internet connectivity helped

spur change on a revolutionary scale, connecting corners of this vast nation of more than 1.3 billion consumers and opening the country to a world of technologically fuelled economic and societal opportunity. Mass urbanization, rapid growth of the middle class, widespread adoption of mobile and smartphone technology — with more still yet to come.

T

Social

Economic

Technological

Political

Infl

uen

ce

PHOTOS: NUTAN/Gamma-Rapho; Nora Schuster/Imagno; Dhiraj Singh/Bloomberg; STR/AFP; Kyodo News; Arun Sankar/AFP; Paula Bronstein /The Verbatim Agency –all via Getty Images


• War with Pakistan over Kashmir

• India becomes a republic

• India Institute of Technology (Nehru)

• India loses war with China

• Compulsory birth control

• Arrival of fast food chains

• Internet comes to India

• Rise of Orkut (social network)

• High-speed train

• Demonetization

• Pan-India GST rollout

• First female president

• Facebook arrives

• 50 TV channels

• Population > 1 billion

• International TV channels added

• Improved roads

• Rise of the middle class

• Outsourcing to India

• Only one TV channel until 1980

• Indian dramas (soaps)

• Indira Gandhi is first female Prime Minister

• Liberalization of the rupee• Green

Revolution

• Rise of the feminist movement

• Framing of the constitution

• Mahatma Gandhi assassinated

• Independence from Britain

• Independence movement

Facebook arrives •

• War with Pakistan over Kashmir • High-speed train

• Indira Gandhi is first female Prime Minister

• Mahatma Gandhi assassinated

• Compulsory birth control

• Improved roads

Demonetization •


7 8

I wish there was easier transportation and delivery from services and products abroad … there’s a lot of additional shipping and then there’s problem of customs.

I’m much more comfortable being disconnected if I’m abroad. If I’m in India, I [need] to be connected and know what’s happening.

My mom used to tell me, it was very common for anybody who was 22 and getting married and having a child at 23. For my age group, I got married at 27 and my sister got married at 28.

» Logistics cannot meet appetite for international brands and products

» Desire for price comparison facility

» Branded apparel popular but evidence of negative sentiment from younger consumers

» Effort to regulate data flow with technology, such as ad blockers, but feeling that it is futile

» Targeted marketing activity that aligns with consumer interest is valued

» Conventional channels preferred to SMS messaging and phone calls for brand communications

» AI seen as a great way to make life easier in the future

» Voice messages viewed as perfect compromise of the intimacy of voice and the convenience of messaging

» Ability to disconnect from the internet/devices for short periods of time highly prized

» Life stages become less rigidly defined for younger generations, with marriage and children delayed

» Older Indians feel less restricted by their age

» Drive among the younger generations to start their own businesses

» Strong desire for quality food, whether in restaurants or grocery stores

» Drive to make investments, with property highly prized

» Health and well-being deemed to be important alongside material wealth for urban and financially independent consumers

Himani, 30, New Delhi Aanchal, 33, Bangalore Kamal, 26, New Delhi Leela, 26, New Delhi

I do some amount of screening …but I think it is grossly inadequate [given] the level at which I’m operating.

Deepak, 63, Mumbai

I try to seek [quality] for everything.

India:emerging themes

My motivation My attention My connection My watch My wallet

would trade their personal data to a company for:

87%

better security

better products and services

better customer experience and personalization 26%

24%21%

would rather lose their wallet than their phone

55%

have disconnected26%

43%needed a break as the primary reason

32%indicated they were missing out on life as the tipping point

a day spent on life on average(one of the lowest countries)

4.5h

a day worked on average, but people would prefer to work 8.4 hours a day

8.5hof families indicated their children influence their spending

23%will most likely view brands on social media that “offer deals or discounts”

will most likely view brands on social media that “showcase cool content”

13%

58%

indicated advertising influences their buying/spending decisions (highest country)

24%

7 8




9 10

Duncan AvisPrincipal, Advisory Customer Solutions, [email protected]

Anson BaileyConsumer & Retail Leader, ASPAC [email protected]

Nathan BeaverPartner, Customer & Digital, [email protected]

Joel BenzrimaPartner, Global Leader Consumer & Retail sector, Advisory, [email protected]

Katie BollaDirector, Customer and Digital, [email protected]

Robert BoltonPartner, Head of People and Change, Global Centre of Excellence, KPMG International

Michelina Campanella Senior Associate, KPMG Innovation [email protected]

Adrian ClampPartner, Head of Customer Advisory, [email protected]

Miranda ClampUS Innovation Lab, Summer Intern, UK

David ConwayDirector of Experience, Customer Experience Excellence Centre, [email protected]

Dan CoonanExecutive Director, Global Consumer & Retail,KPMG [email protected]

Todd CullenManaging Director, Customer Solutions, [email protected]

Deno FischerPrincipal, Advisory Customer Solutions, [email protected]

Torsten FritzResearch Director, Customer Experience Excellence Centre, [email protected]

Fabio GrandiPartner Director, Customer Experience Leader, [email protected]

Nick GriffinPartner and Head of Global Strategy Group, [email protected]

Oliver HaywoodDirector, Customer and Digital, [email protected]

Emmanuel HembertConsumer & Retail Advisory Lead, [email protected]

Elisa HollandDirector, KPMG Innovation Lab, [email protected]

Paul HowesPartner in Charge, Customer, Brand and Marketing, Australia

ContributorsPeter HughesCustomer and Digital Practice Lead, KPMG in Canada

Tamsin JenkinsExecutive Advisor, Customer Experience Excellence Centre, [email protected]

Kristina LeeGlobal Customer Insights Program, Lead Research & Data [email protected]

Wei LinPartner, Global Strategy Group,Consumer & Retail Advisory Lead, [email protected]

Jennifer Tuthill LinardosGlobal Customer Insights, Program Director, KPMG [email protected]

Paul MartinPartner and Head of Retail, [email protected]

Lauren MostowykGlobal Communications, KPMG [email protected]

Guilherme NunesPartner, Consumer & Retail Sector Leader, [email protected]

Jessie QianHead of Consumer Markets, [email protected]

Abhijeet (Avi) RanadeHead, Customer & Channels Advisory,Partner, Management Consulting, [email protected]

Aditya RathPartner, Digital Customer, [email protected]

Abhijit RawalPartner, Financial Services, [email protected]

Urvashi RoeGlobal Executive,Customer Center of [email protected]

Anton RuddenklauHead of Digital & Innovation,Financial Services & Partner, [email protected]

Kes SampantharManaging Director,KPMG Innovation Lab, [email protected]

Farhan SyedPartner, Head of Digital and Innovation, Lower Gulf [email protected]

Mark ThompsonGlobal Privacy Lead, [email protected]

Jessica TuttonGlobal Marketing, KPMG [email protected]

Terry WallsManaging Director, Customer Service Transformation Lead, [email protected]

Christoph ZinkeHead of Global Strategy Group, ASPAC [email protected]

Lynne Doughtie Chairman and CEO, KPMG in the US

Nader Haffar CEO, KPMG in the Lower Gulf region

Charles Krieck Chairman and CEO, KPMG in Brazil

Arun M. Kumar Chairman and CEO, KPMG in India Benny Liu Chairman, KPMG China

Elio Luongo CEO, KPMG in Canada

Bill Michael Chairman, KPMG in the UK

Jay Nirsimloo Chairman and CEO, KPMG in France

Honson To Chairman, KPMG China


Reference Agricultural employmentSourceIndia economic survey 2018, Financial Express (India), 2018

Reference WhatsApp Indian usersSource WhatsApp looking for India head, Economic Times (India), 2018

Reference Number of ‘kirana’ corner storesSourceThe kirana store will remain evergreen, The Hindu, 2018

Citations

Me, my life, my wallet 2018 - India summaryMe, my life, my wallet 1 2 India: Subcontinent of...

Documents

Transcript of Me, my life, my wallet 2018 - India summaryMe, my life, my wallet 1 2 India: Subcontinent of...