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Changing trends of Indian consumers
The new series of smartphones available in the market are cheap and easy. This smartphone revolution began in 2007 in India. And since then with technological advances smartphones have increasingly become the one stop shop for all our needs.
The price of a smartphone starts from Rs.7000. And with this price it is well within the reach of an average consumer. Services like shopping and banking are increasingly being done on a smartphone. The Citibank in-app audio/video chat with relationship managers is an excellent example of the extent of smartphone services. This service is unique to India, and has not been launched by the bank anywhere else.
These affordable smartphones allow common people to have access to the internet. This in turn allows them access to education and job opportunities and even entertainment. But this increasing sale of smartphones has had a negative impact on one sector. And that is the sale of Fast Moving Consumer Goods (FMCG) in our country. Sales growth of large FMCG companies like Coca-Cola Co. and Nestle declined because of this particular reason.
The spokesman of Nestle in India Sanjay Khajuria says, “The growing consumption of mobile data and impressive growth in the number of mobile users … has resulted in consumers increasing their spends on phones rather than on fast-moving consumer products.”
India is the second largest internet user base, behind only China. India today has over 460 million users of the internet. This figure is only 26% of the total population of our country. This figure will only increase with time and with the aids available to this sector. Aids such as mobile internet and data packs being available at a cheaper cost.
The use of the internet and data is thus increasing rapidly. The Coca-Cola president in India Venkatesh Kini said that “We are competing for the consumer’s wallet not just with beverages and other impulse categories, but also with data services on smartphones.”
These figures stand as a testament to an increasing trend among Indian consumers. The trend is that today consumers are more attracted to things digital. The digital platforms too have met Indian consumers halfway through by offering flexibility in their services. For example, limited data packs are available at cheaper rate for those that can’t afford monthly plans. While the consumer goods companies are recording a decline in sales, data consumption of telecom companies is on the rise.
This has forced a change in game plan for the FMCG companies as well. Some FMCG companies offer free data recharge on their products to attract the customer. While others offer smartphone to buyers through a lucky draw system.
Most consumers in India are from the salaried class. They have limited buying capacity. With the increasing amount is being spent on smartphones and related services. The consumer then cuts corners in other non essential commodities. Most of the times these commodities are of the fast moving consumer goods type such as the products of Coca Cola Co. and Nestle S.A.
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