Capitalism runs as much on sentiment as on money. Almost a daily dose of bad news on TV and in the newspapers has possibly inflicted the same amount of damage to the economy as the events on either side of the Atlantic. The biggest consumers and believers in this news are the salaried people who work in large companies that are integrated with the global markets.
Being the biggest receptors of media, they are also the largest consumer segment for Indian marketers. The companies that are catering to this segment have seen weakening sentiments, and sluggish sales. In times like these, consumers look at ways of cutting costs and companies have to adapt to these changes if they want to do well.
What is really important is that hidden behind the consumer statistics of most marketeers is a segment that is largely ignored. Yet, it forms an overwhelming majority of the Indian consumers. These are the self-employed Indians.
Our economy is not that of wage-earners and shareholders. A significant portion consists of the self-employed. The share of the national income represented by proprietorrun concerns and partnerships is 35%. The share of companies is around 15%, government nearly 25%, and agriculture about 25%. The self-employed form the largest consumer segment in almost every city except the metros.
Removed from financial markets and distant from transnational conglomerates, I find the self-employed the least affected by the slowdown sentiment. They don't fear job losses or a shrinking global marketplace. Instead, they are businessmen and entrepreneurs who are selling tangible products to customers who pay hard currency.
They are shop-owners, small traders, firstgeneration entrepreneurs and self-employed professionals. Their sense of identity, behaviour and fashion sensibilities make them quite different from their salaried cousins in large metros. Unlike salary-earners, the selfemployed use products much more to signal success. They want to stand out rather than blend into the crowd, as the salaried classes typically do. The self-employed businessman is also far sharper at evaluating 'deals' offered by marketers. Too many offers and promotions or an overt attempt at 'creativity and humour' in communication can lead him to question the real value offered.
When it comes to buying, the average ticket size of any purchase by a self-employed person is high. The availability of ready cash is also higher among the group, making it easier to sell high-ticket items. A shopping trip can take place any time on any day of the month. It is not concentrated on weekends or at the beginning of the month as is the case with the salaried class.
It is this category of consumers that could well be the solution to reviving sluggish sales. For not only are they the least affected by the economic downturn, but they make for the greatest numbers.
However, the reality is that customer strategies, communications and customer profiling are done by salaried professionals from their head offices in large cities. And invariably, they fail to take into account the needs, aspirations, sentiments and subtle nuances of marketing and communicating with the self-employed.
Kishore Biyani is CEO, Future Group
