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23.4.13



Move over emerging economies. Instead, the largest 'emerging market' in the world will be represented by women over the next decade.

So far, the world has focused on the growth opportunity in emerging economies, and the power they represent in driving consumer demand. Now, women seem to be providing that opportunity with their income expected to increase worldwide by as much as $5 trillion in the next five years, almost twice the growth in GDP expected from China and India together.

This has led to global research firm Espirito Santo saying in its analysis that the most powerful force in global demand over the next decade could be the changing role of women in the world economy, and not the progress in emerging economies, or on new advances in energy and health-related technologies.

The strong emergence of women both as consumers and decision-makers is playing out in India too, and points to the growing financial activity by women.
In addition to their growing purchasing power, the size of the opportunity is also huge as they make or influence between 60-80% of consumption decisions. Not surprisingly, the research cites a Nielsen study which found that Indian women are the most likely to spend (rather than save) any extra cash they might happen to have on themselves over the next five years.

Also, the number of women with a bank savings account in India has increased 33%, and so have those with credit cards over the last decade. In 2001, barely 4% of respondents owned a credit card in 2001 while a decade later one in 10 had a credit card, according to an IMRB study, cited by the firm.
Marketers are also looking to tap this sizeable opportunity. Banks offer gold purchase schemes largely to working women, which is increasingly becoming the target market. The credit card business is also targeting women by offering rewards/bonuses on high-spend categories, and heavy discounts on women-oriented brands.

Says marketing expert Harish Bijoor, "The feminine gender side of the economy is a robust one. It is all about taking purchase decisions. Today, the skew is female positive. There is a distinct swing in decision making, favouring the feminine gender. Every good company has a gender-focus plan. The auto category, hitherto considered a man's domain, has even moved its focus now, with the empowered earning woman in the market for every kind of auto, light and heavy duty included. While the Vespa wants to become more macho and accepted by women as well, the Bolero wants a piece of the feminine pie as well."
Spending by women, both in current (clothes, food) and durables, as well as in services (education, healthcare, financial) is likely to be more family oriented. Health, convenience and affordability are also often cited as important criteria in women's spending decisions.

Regardless of differences in culture, religion, geographical position across markets globally, economic development leads to increased female participation in the workforce and higher wealth being 'owned' by women everywhere. Investors should be able to play this convergence, this structural change in their economies, via the equity markets, the firm adds.
The consumption drivers in India are manifold changing demographics, rising incomes and under-penetration but the strong emergence of women both as a consumers and decision-makers is playing a tremendous role. In addition, this is happening at various socio-economic strata.
In the cities, with an increasing number of women entering the 'services' sector (official data says 70% of total women employed in 2010 were in the services sector), household incomes have doubled, resulting in a higher propensity to consume, and also a demand for better standards of living. A recent IMRB survey of about 9,000 urban Indian women found that the income of women living and working in cities increased to Rs 9,457 ($180) a month in 2010 from Rs 4,492 ($85) in 2001.
It is not just the rising incomes that are fuelling the trend but also the changing socio-economic environment as urban women are now more independent, better educated and career-oriented.
It is, therefore, not surprising to see that women are the decision-makers when it comes to the purchase of most consumer durables.
Says Rahul Saighal, CMO, Samsung India, "Purchase of household products like washing machines and microwaves is primarily driven by women, as against TVs and home theatres which are male-oriented. As a result, we have incorporated many women-specific features like a 'sari course' in a washing machine, or a feature for Indian cooking in microwaves, based on research."
The focus sectors to capture this opportunity include food, apparel, financial services, healthcare, consumer durables, telecom services and real estate.

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