It is now official. First time in the history of modern India, high income households will outnumber lower income households. According to latest NCAER estimates India will have 46.7 Million households in high income category and 41 Million households in lower income category.
Households earning up to Rs 45000 per annum are dubbed as lower income households, and those earning over Rs 1.8L per annum are classified as high income households. But the real story lies in the number of households that are between Rs 45000 to 1.8 L per annum. This number has now reached estimated 141Mn households, out of a total of 228Mn households in the country. This is what is called the middle class in India. This middle class now is over 60% of the entire country. This is a stupendous turnaround that we are seeing happen to our country.
We often assume that the entire middle class is ‘one class’ and we can try and paint them in one go. The truth is that the middle class in India is a constantly evolving mix of audience. The current decade has seen a very strong growth in middle class. The economic growth, the rising prosperity, more and more people moving up ladder has created a new class of customers. These are the new members of middle class of India.
What is fuelling this new middle class? What are the trends that they will trigger? After all they are a very potent group of consumers
The new middle class has been powered by women. Just look at the long term literacy data of India and the impact women are having will be clear. The female literacy rate has risen from 8.6% in 1951 to 54% in 2001 census. The 2011 census I am sure will show that the number may have crossed 60%. Interestingly the growth of female literacy rate was 15% between 91 and 2001, as against just 11% of male literacy growth. Clearly the women are catching up with males, and this too is triggering a set of new trends.
Here’s a look at some of the new truths about the new middle class
The growth of the new middle class is powered by women. With better education they are joining the work force in a greater number. With this they are taking control of their future, having a greater say in their wedding, deciding on when to have kids and how many. Apart from the demographic impact they are also driving their partners with a greater zeal to improve their future. They are making the most of change in their demographic and social status.
The new middle class will impact the travel choices in a big way. The new found economic freedom will translate into a greater desire to explore the world. They will pack their bags and take vacations at a greater frequency than ever before. And they will not always be looking at visiting their relatives only when they do so.
The new middle class is very serious about securing their future. One of the first serious buying decision they will take will involve buying a house. They will look at buying their own house even before they decide to buy a car. There is no better way to announce the transition than by buying a house. This means that the small home segment will boom in a much bigger way in coming decade
The new middle class is truly driven by dynamism of its own members. They are literally writing their own destiny and crafting their future. They are hardworking, optimist, smart and not driven by the rules of past. They will impact the world of marketing and branding in a big way.
The new emerging reality will be very exciting