News: Cos finance consumers to boost growth
(TNN 28/04/2006) Mumbai - India Inc has learnt its ABCD — ayah, bai, carpenter and driver. It’s this segment that has turned out to be the bread winner, literally, for the big daddies of corporate India. “Companies will have to read the consumer purchasing trends closely.
Nothing can be termed black and white as far as consumption patterns are concerned. The richest may not necessarily be the biggest spenders,” pointed out a top company official.
Although average income levels have shot up sharply among this set of consumers, there are no non-banking financial institutions willing to fund their purchases for lack of official documents such as salary certificates, bank account statements etc.
But, now companies stepping in to bridge this gap. LG, for instance, is tying up several local financiers to customise finance packages to tap the urban and rural poor. Bajaj Auto has in fact managed to tap a large section of the bottom of the pyramid in the last few months through its finance arm, Bajaj Auto Finance.
“Instead of looking at a single source of income, we have started looking at the ‘family income,’ making it easier to finance the vehicle,” says S Sridhar, VP of Bajaj Auto. Earlier, these consumers would buy a second hand two-wheeler or a moped. With two-wheelers getting more affordable, consumers increasingly want to own a new model, Mr Sridhar adds.
The retailers are tying up with the manufacturers to develop products in areas such as food, grocery, fashion, furniture, electronics and communication products that specifically cater to their needs. These consumers who constitute a massive 50% of the consuming class seem to be far more willing to spend and are getting more status conscious.
Retailers such as Pantaloon are talking about creating a capacity to spend. Mr Biyani says Pantaloon recruits about 500-600 people every month and only one-third of them have college education. “Aspirations are not reserved for only the ‘haves’ of a country. In fact, some of the richest are the biggest bargain seekers.
And there are consumers in the low-end of the market who are willing to splurge. That’s an attitude difference,” said Piruz Kambhatta, CMD of Rasna.
Retailers are now planning to push growth rates in the segment where consumers have stepped away from a self-denial mode with better purchasing power and finance options, not denying themselves immediate gratification unlike their predecessors.
Companies are willing to look at the larger picture and rely on absolute market and consumer intelligence to chalk out more reality-based strategies to drive growth. Hero Honda, for instance, has begun tracking monthly household incomes in the bottom-end of the market to get more consumers into their entry-level segment.
Nothing can be termed black and white as far as consumption patterns are concerned. The richest may not necessarily be the biggest spenders,” pointed out a top company official.
Although average income levels have shot up sharply among this set of consumers, there are no non-banking financial institutions willing to fund their purchases for lack of official documents such as salary certificates, bank account statements etc.
But, now companies stepping in to bridge this gap. LG, for instance, is tying up several local financiers to customise finance packages to tap the urban and rural poor. Bajaj Auto has in fact managed to tap a large section of the bottom of the pyramid in the last few months through its finance arm, Bajaj Auto Finance.
“Instead of looking at a single source of income, we have started looking at the ‘family income,’ making it easier to finance the vehicle,” says S Sridhar, VP of Bajaj Auto. Earlier, these consumers would buy a second hand two-wheeler or a moped. With two-wheelers getting more affordable, consumers increasingly want to own a new model, Mr Sridhar adds.
The retailers are tying up with the manufacturers to develop products in areas such as food, grocery, fashion, furniture, electronics and communication products that specifically cater to their needs. These consumers who constitute a massive 50% of the consuming class seem to be far more willing to spend and are getting more status conscious.
Retailers such as Pantaloon are talking about creating a capacity to spend. Mr Biyani says Pantaloon recruits about 500-600 people every month and only one-third of them have college education. “Aspirations are not reserved for only the ‘haves’ of a country. In fact, some of the richest are the biggest bargain seekers.
And there are consumers in the low-end of the market who are willing to splurge. That’s an attitude difference,” said Piruz Kambhatta, CMD of Rasna.
Retailers are now planning to push growth rates in the segment where consumers have stepped away from a self-denial mode with better purchasing power and finance options, not denying themselves immediate gratification unlike their predecessors.
Companies are willing to look at the larger picture and rely on absolute market and consumer intelligence to chalk out more reality-based strategies to drive growth. Hero Honda, for instance, has begun tracking monthly household incomes in the bottom-end of the market to get more consumers into their entry-level segment.
posted by InCar Group Press Room at 11:26
2 Comments:
Nice blog!
Pick 3 Turbo Player
http://hotties.hits.io ~~ Hit on hundreds the hottest girls and guys automatically each day, download thousands of full sized pics and profiles from the major dating sites, all with one click dating sites Hit on a Hottie 1.0
Post a Comment
<< Home