Great Indian Families 2009 Understanding the Indian ‘Families’ as Consumption Units A JuxtConsult – Indicus Analytics Joint Study

Correcting a basic market research anomaly! Consumers live their lives as ‘ families ’ and not households. And family consumptions get driven by the all the people living in them and not just by the ‘chief wage earner’ of the house How a family consumes gets defined as much by the ‘family composition’ and the ‘ lifecycle stage ’ the family is in, as by its socio-economic status and the ‘ability to spend’ It is therefore important to ‘distinguish’ and understand families by their ‘ member composition ’ to target them appropriately

Consumers live their lives as ‘ families ’ and not households. And family consumptions get driven by the all the people living in them and not just by the ‘chief wage earner’ of the house

How a family consumes gets defined as much by the ‘family composition’ and the ‘ lifecycle stage ’ the family is in, as by its socio-economic status and the ‘ability to spend’

It is therefore important to ‘distinguish’ and understand families by their ‘ member composition ’ to target them appropriately

Topline Findings

There are approx. 226 million families in India* (72 mn urban, 154 mn rural) The average family size varies from 1 to 6.9 depending on the family composition 25 mn Indian families (11% of all families) have more than 1 earning member 28 mn Indians (2.5%) prefer to read in English, marginally more than Malayalam. 50% of Indians preferring to read in English live in rural areas Average monthly family income in India is Rs.5,930 (‘per capita’ is Rs.1,350) 70% of all Indian families earn average to below-average incomes The Macro Picture * accounting for approx. 1,112 million individuals (343 million urban and 769 million rural)

There are approx. 226 million families in India* (72 mn urban, 154 mn rural)

The average family size varies from 1 to 6.9 depending on the family composition

25 mn Indian families (11% of all families) have more than 1 earning member

28 mn Indians (2.5%) prefer to read in English, marginally more than Malayalam. 50% of Indians preferring to read in English live in rural areas

Average monthly family income in India is Rs.5,930 (‘per capita’ is Rs.1,350)

70% of all Indian families earn average to below-average incomes

At 30%, highest proportion of families belong to SEC ‘R4’ 19.5 million families (27% of urban, or 9% of all Indian families) belong to SEC ‘A’ and ‘B’ Chief wage earners of 87% of SEC ‘A’ and 36% of SEC ‘B’ families are graduates No SEC ‘C’ and ‘R1’ chief wage earners are graduates. But 15% SEC ‘C’ families and 22% SEC ‘R1’ families have a graduate member within the household Clearly then, defining the socio-economic status (SEC) of a household using education level of the ‘chief wage earner’ is losing its meaning and can often mislead The Socio-Economic Landscape Time to look beyond the ‘urban-rural’ divide, and the ‘chief wage earner’ driven SEC definitions to understand families as consumption units!

At 30%, highest proportion of families belong to SEC ‘R4’

19.5 million families (27% of urban, or 9% of all Indian families) belong to SEC ‘A’ and ‘B’

Chief wage earners of 87% of SEC ‘A’ and 36% of SEC ‘B’ families are graduates

No SEC ‘C’ and ‘R1’ chief wage earners are graduates. But 15% SEC ‘C’ families and 22% SEC ‘R1’ families have a graduate member within the household

Clearly then, defining the socio-economic status (SEC) of a household using education level of the ‘chief wage earner’ is losing its meaning and can often mislead

The Real Socio-Economic Ladder by Incomes SEC ‘R4’ SEC ‘R3’ SEC ‘E’ SEC ‘D’ SEC ‘R2’ SEC ‘C’ SEC ‘R1’ SEC ‘B’ SEC ‘A’ 1 (Rs.830) 1.1 times of R4 1.2 ” 1.4 ” 1.6 ” 1.8 ” 2.3 ” 3.0 ” 5.3 ” Monthly ‘Per Capita’ Family Income Ratios

SEC ‘R4’

SEC ‘R3’

SEC ‘E’

SEC ‘D’

SEC ‘R2’

SEC ‘C’

SEC ‘R1’

SEC ‘B’

SEC ‘A’

1 (Rs.830)

1.1 times of R4

1.2 ”

1.4 ”

1.6 ”

1.8 ”

2.3 ”

3.0 ”

5.3 ”

The New Indian Consumer Pyramid * Total – 226 million families (1,112 million individuals) SEC A SEC B SEC R1 51 million families SEC C SEC R2 44 million families SEC D SEC E SEC R3 SEC R4 131 million families Tier 1 The Consuming Class Tier 2 The Aspiring Class Tier 3 The Underprivileged (260 million individuals) (217 million individuals) (634 million individuals)

Looking at Families by ‘Lifecycle’ Stage 51% Indians are married. But only 1 in 5 Indian family (21%) is a 3-generation joint family, or ‘ Dynasties’ An equal proportion of Indian families (21%) are ‘ Baby Sitters ’ - with the eldest child below 12 years in age The majority 45% of Indian families are ‘ Maturing Mentors’ , or families with the youngest child above 12 years in age Young married couples without any children, the ‘ Nest Builders’, account for only 7% of all Indian families The single independents, or ‘ Free Birds ’, account for only 1.3% of all Indian families

51% Indians are married. But only 1 in 5 Indian family (21%) is a 3-generation joint family, or ‘ Dynasties’

An equal proportion of Indian families (21%) are ‘ Baby Sitters ’ - with the eldest child below 12 years in age

The majority 45% of Indian families are ‘ Maturing Mentors’ , or families with the youngest child above 12 years in age

Young married couples without any children, the ‘ Nest Builders’, account for only 7% of all Indian families

The single independents, or ‘ Free Birds ’, account for only 1.3% of all Indian families

Dynasties have the highest average monthly family incomes (Rs. 6,530). But they have the lowest average ‘per capita’ monthly incomes (Rs.975) Free birds show the second highest average monthly family incomes (Rs.6,385), and the highest average ‘per capita’ monthly incomes (Rs.6,385)* Rented accommodation is highest among Free Birds (at 35%). Dynasties show the highest incidence of ‘inherited’ property (at 74%) Automobile ownership (both cars and 2-wheelers) is highest among Dynasties Preference for reading in English is relatively highest among ‘Free Birds’ (6%) and lowest among ‘Dynasties’ (0.5%) Glimpse of their Socio-Economic Status…. * Note – Sample of ‘Free Bird’ segment relatively low for high statistical accuracy of its segment level findings

Dynasties have the highest average monthly family incomes (Rs. 6,530). But they have the lowest average ‘per capita’ monthly incomes (Rs.975)

Free birds show the second highest average monthly family incomes (Rs.6,385), and the highest average ‘per capita’ monthly incomes (Rs.6,385)*

Rented accommodation is highest among Free Birds (at 35%). Dynasties show the highest incidence of ‘inherited’ property (at 74%)

Automobile ownership (both cars and 2-wheelers) is highest among Dynasties

Preference for reading in English is relatively highest among ‘Free Birds’ (6%) and lowest among ‘Dynasties’ (0.5%)

How a Family Rupee is being Spent! * Taken on valid households base, so doesn’t add up to 100%. ** Taken on all households base, so adds up to 100%. Note - Not all families spend money on all heads Household Consumption Head Distribution of Spends (%) Families Who Spend on Them* All Families** Basic food and clothing 55% 55% Rent and utilities 12% 5% Transport and conveyance 12% 11% Loan and other regular liabilities 11% 3% Leisure and entertainment 11% 9% Saving and investment 15% 11% Other unclassified spends 13% 6%

Physical Asset Ownerships! Home + Automobile = 27% urban and 25% all India Household Asset % Families Owning (Urban) % Families Owning (All India) Home 65% 86% Any TV 91% 86% Color TV 79% 63% C&S Connection 69% 56% Any Phone 66% 50% Mobile Phone 64% 48% Any Automobile 42% 32% Car 3.5% 2% 2-wheeler 41% 31% Fridge 35% 22% Washing Machine 14% 7% Computer/Laptop 10% 4.5% Air Conditioner 2% 0.8%

Financial Asset Ownerships! Home + Bank Account = 28% urban and 41% all India Home + Life Insurance = 12% urban and 16% all India Financial Asset % Families Owning (Urban) % Families Owning (All India) Bank Account 59% 58% Life Insurance 26% 23% Debit Card 16% 9% FD/Bonds 10% 5% Credit Card 4% 2% Medical Insurance/CGHS 4% 2% Mutual Funds/Shares 3% 1%

Types of Assets! * All India Figures. May add up to more than 100% because of multiple ownerships Cars % Families Owning Small Car (<4 lakhs) 68% Mid Size Car (4-8 lakhs) 29% Premium Car (8-14 lakhs) 5% Luxury Car (>14 lakhs) 1% Bikes % Families Owning 100cc or less 48% 125cc 39% 150cc 11% 180cc or above 3% TV % Families Owning Regular Flat 21 inch or less 88% Regular Flat > 21 inch 11.5% LCD & Other Premium 0.5% Washing Machine % Families Owning Semi-automatic 78% Automatic 22%

Types of Assets! * All India Figures. May add up to more than 100% because of multiple ownerships Mobile Phone Features % Families Owning Color Screen 82% Games 78% FM Radio 49% Any Camera 16% MP3 Player 12% Bluetooth 10% Video recording 9% GPRS 7% Extended memory 4% Touch Screen 4% Wi-fi 1% Mobile Connection % Families Owning Pre-paid 95% Post-paid 5% GSM 75% CDMA 11% Can’t Say 14% Fridge % Families Owning Single door 89% Double door 11%

Types of Assets! * All India Figures. May add up to more than 100% because of multiple ownerships Size of House % Families Owning Less than 250 sq.ft. 21% 250 – 500 sq.ft. 36% 500 – 1,000 sq.ft. 27% 1,000 – 1,500 sq.ft. 9% 1,500 sq.ft. and above 7% Credit Card % Families Owning Co-branded 20% Silver 53% Gold 27% Platinum/Titanium 5% Mobile Services Used % Families Owning Roaming National 64% ISD Calling 6% MMS 4% GPRS 4% GPS 1% Roaming International 0.3%

35% urban families live in a rented house. Only 5% rural families do so 38% of SEC ‘A’ families live in 1,000 sq.ft. plus house Only 2.5% urban families have a home loan running currently 54% small car ownership and 57% motorcycle ownership is in rural India 24% SEC ‘A’ families have a car, only 6% SEC ‘R1’ households own a car. But in absolute numbers, while SEC ‘A’ own 1.58 mn cars SEC ‘R1’ own 1.66 mn cars 3 out of 4 car owners also own a 2-wheeler. Only 5% of 2-wheeler owners also own a car The average monthly family income of a ‘small car’ owning family is 2.1 times higher than a ‘motorcycle’ owning family; that of a ‘premium car’ owning family is 3.8 times higher than a ‘motorcycle’ owning family ‘ Maturing Mentors’ have the highest proportionate ownership of mid size cars (at 33%), ‘Vintage Wines’ of small cars (at 88%) Glimpse of Segment Level Findings….

35% urban families live in a rented house. Only 5% rural families do so

38% of SEC ‘A’ families live in 1,000 sq.ft. plus house

Only 2.5% urban families have a home loan running currently

54% small car ownership and 57% motorcycle ownership is in rural India

24% SEC ‘A’ families have a car, only 6% SEC ‘R1’ households own a car. But in absolute numbers, while SEC ‘A’ own 1.58 mn cars SEC ‘R1’ own 1.66 mn cars

3 out of 4 car owners also own a 2-wheeler. Only 5% of 2-wheeler owners also own a car

The average monthly family income of a ‘small car’ owning family is 2.1 times higher than a ‘motorcycle’ owning family; that of a ‘premium car’ owning family is 3.8 times higher than a ‘motorcycle’ owning family

‘ Maturing Mentors’ have the highest proportionate ownership of mid size cars (at 33%), ‘Vintage Wines’ of small cars (at 88%)

Top 5 Biggest Communities in India Top 5 Urban Communities % of Urban Families Top 5 Rural Communities % of Rural Families Gujarati 16% Telugu 9% Awadhi UP 12% Marathi 8% Telugu 12% Tamil 8% Kannada 11% Non-Awadhi UP 6% Marathi 7% Punjabi 6%

Highest per capita monthly income is among Kannads (Rs.2,190) and lowest among the Bihari Hindis (Rs.730) Marwari community shows the highest proportionate spend on ‘loans and liabilities’ (at 15.4%). Telugu community shows the highest proportionate spend on ‘savings and investment’ (at 20.7%) Gujaratis and Marwaris show the highest ownership of ‘any automobile’ (at 43% and 39%). Assamese show the highest penetration of cars at 7% Tamils and Kannads have the highest penetration of color TV (at 89%) Punjabis have the highest penetration of fridge at 56% Telugus have the highest penetration of air conditioners at 4% Kannads and Gujaratis have the highest penetration of mobile phones at 68% and 66% A Glimpse of Segment Level Findings….

Highest per capita monthly income is among Kannads (Rs.2,190) and lowest among the Bihari Hindis (Rs.730)

Marwari community shows the highest proportionate spend on ‘loans and liabilities’ (at 15.4%). Telugu community shows the highest proportionate spend on ‘savings and investment’ (at 20.7%)

Gujaratis and Marwaris show the highest ownership of ‘any automobile’ (at 43% and 39%). Assamese show the highest penetration of cars at 7%

Tamils and Kannads have the highest penetration of color TV (at 89%)

Punjabis have the highest penetration of fridge at 56%

Telugus have the highest penetration of air conditioners at 4%

Kannads and Gujaratis have the highest penetration of mobile phones at 68% and 66%

Media Usage Status ‘ Vintage Wines’ are the relatively heaviest watchers of TV. So are Marathis, Telugus and Tamils among communities ‘ Nest Builders’ are the relatively heaviest listeners of radio. Among communities, Telugus, Delhi Hindis and Gujaratis stand out Oriya and MP Hindi communities are significantly heavier readers of newspaper ‘ Baby Sitters’ are the relatively heaviest users of internet from home Media Families Using At Home In millions (All India) Individuals Using At Home In millions (All India) % Spending More than 1 Hour Daily Weekday (All India) Television 187 613 43% Newspaper 104 361 10% Radio 85 274 27% Internet 8 20 32%

‘ Vintage Wines’ are the relatively heaviest watchers of TV. So are Marathis, Telugus and Tamils among communities

‘ Nest Builders’ are the relatively heaviest listeners of radio. Among communities, Telugus, Delhi Hindis and Gujaratis stand out

Oriya and MP Hindi communities are significantly heavier readers of newspaper

‘ Baby Sitters’ are the relatively heaviest users of internet from home

Report Details

Possible Segment Reports : Families by member composition Free Birds (single independents) Nest Builders (young married couple with no children) Baby Sitters (married with eldest child below 12 years) Mature Mentors (married with youngest child above 12 years) Dynasties (3 generation joint family) Vintage Wines (middle age/elderly married couple living alone) Urban vis-à-vis Rural Families Single vis-à-vis Multiple Income Families Families by Socio-Economic Classes (both urban &rural SEC) Families by Community Types (marwari, gujrati, punjabi,….) Family Profiles by Most Expensive Vehicle Owned Family Profiles by Size of House List Of Reports Note: Segment level analysis in any of the reports is subject to collection of sufficient sample responses at the segment level. Possible Category Reports : Family Profiles by Type of Car Family Profiles by Type of Bike Family Profiles by Type of TV Family Profiles by Type of TV Connection Family Profiles by Type of Fridge Family Profiles by Type of Washing Machine Family Profiles by Type of Mobile Phone Family Profiles by Mobile Service Family Profiles by Type of Credit Card

Possible Segment Reports :

Families by member composition

Free Birds (single independents)

Nest Builders (young married couple with no children)

Baby Sitters (married with eldest child below 12 years)

Mature Mentors (married with youngest child above 12 years)

Dynasties (3 generation joint family)

Vintage Wines (middle age/elderly married couple living alone)

Urban vis-à-vis Rural Families

Single vis-à-vis Multiple Income Families

Families by Socio-Economic Classes (both urban &rural SEC)

Families by Community Types (marwari, gujrati, punjabi,….)

Family Profiles by Most Expensive Vehicle Owned

Family Profiles by Size of House

Possible Category Reports :

Family Profiles by Type of Car

Family Profiles by Type of Bike

Family Profiles by Type of TV

Family Profiles by Type of TV Connection

Family Profiles by Type of Fridge

Family Profiles by Type of Washing Machine

Family Profiles by Type of Mobile Phone

Family Profiles by Mobile Service

Family Profiles by Type of Credit Card

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Contact Juxt Consult , Delhi Contact: Sanjay Tiwari 3, Kehar Singh Estate, 1st Floor, Westend Marg, Lane 2, Said-ul-Ajaib, New Delhi - 110 030 +91- 11-29535098, 91-9811256502

Juxt Consult , Delhi Contact: Sanjay Tiwari 3, Kehar Singh Estate, 1st Floor, Westend Marg, Lane 2, Said-ul-Ajaib, New Delhi - 110 030 +91- 11-29535098, 91-9811256502

Demographic and socio-economic profile Location – Town class (village class), region, community Educational qualification, current occupation (and industry of occupation) of members in the household SEC (urban, rural) Gender, age, marital status, preferred language of reading of all members in the household Income status and composition (monthly household income, income from outside, earning and dependent members) Per-capita household income Consumption, asset ownership and liability profile Share of expenditure by main household spending heads ( food & clothing, rent & utilities, transport / conveyance, leisure & entertainment, loan & liability payments, savings & investments) House ownership, size of house, no. of rooms Vehicle ownership (bicycle, 2-wheeler, 4-wheeler) Physical asset ownership – T V, fridge, washing machine, AC, microwave, music system, radio, DVD player, Ipod, video games, regular camera, digital camera, video recorder, tube well/pump, landline phone, mobile phone, computer, laptop, printer, TV connection Financial asset ownership – land, bank account, demat account, fixed d eposits, govt. bonds, chit fund deposits, life insurance, medical insurance, debit card, credit card, mutual fund, shares, etc Currently running loan types if any Information Coverage

Demographic and socio-economic profile

Location – Town class (village class), region, community

Educational qualification, current occupation (and industry of occupation) of members in the household

SEC (urban, rural)

Gender, age, marital status, preferred language of reading of all members in the household

Income status and composition (monthly household income, income from outside, earning and dependent members)

Per-capita household income

Consumption, asset ownership and liability profile

Share of expenditure by main household spending heads ( food & clothing, rent & utilities, transport / conveyance, leisure & entertainment, loan & liability payments, savings & investments)

House ownership, size of house, no. of rooms

Vehicle ownership (bicycle, 2-wheeler, 4-wheeler)

Physical asset ownership – T V, fridge, washing machine, AC, microwave, music system, radio, DVD player, Ipod, video games, regular camera, digital camera, video recorder, tube well/pump, landline phone, mobile phone, computer, laptop, printer, TV connection

Financial asset ownership – land, bank account, demat account, fixed d eposits, govt. bonds, chit fund deposits, life insurance, medical insurance, debit card, credit card, mutual fund, shares, etc

Currently running loan types if any

Quality of key asset ownership Type of car Type of bike Type of TV Type of T V connection Type of fridge Type of washing machine Type of mobile phone Type of mobile services subscribed to Type of credit card possessed Media usage Media used at home (TV, Newspaper, Radio, Internet) Daily time spent on various media at home Which medium relied on most for information for buying products and services Information Coverage

Quality of key asset ownership

Type of car

Type of bike

Type of TV

Type of T V connection

Type of fridge

Type of washing machine

Type of mobile phone

Type of mobile services subscribed to

Type of credit card possessed

Media usage

Media used at home (TV, Newspaper, Radio, Internet)

Daily time spent on various media at home

Which medium relied on most for information for buying products and services

Large scale land survey conducted to profile the composition and consumption characteristics of Indian families. Survey covered over 16,000 households in 40 cities and over 12,000 households in 480 villages spread across all the four regions of the country Sampling methodology chosen to ensure coverage of ‘ town’ and ‘village’ classes of all population strata, and ‘households’ of all socio-economic classification within each of these towns and villages. Villages sampling done in a way to ensure coverage of villages up to distances of 20 kms from the nearest surveyed town Finally, town/village class and socio-economic class combination level ‘weights’ were derived from authentic Govt. of India data and applied to the land survey data to make it representative of the entire Indian population Methodology

Large scale land survey conducted to profile the composition and consumption characteristics of Indian families. Survey covered over 16,000 households in 40 cities and over 12,000 households in 480 villages spread across all the four regions of the country

Sampling methodology chosen to ensure coverage of ‘ town’ and ‘village’ classes of all population strata, and ‘households’ of all socio-economic classification within each of these towns and villages. Villages sampling done in a way to ensure coverage of villages up to distances of 20 kms from the nearest surveyed town

Finally, town/village class and socio-economic class combination level ‘weights’ were derived from authentic Govt. of India data and applied to the land survey data to make it representative of the entire Indian population

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