Small towns buying into good life

A survey of 21 cities across 14 states shows consumer behaviour in small towns is changing fast

The increasing focus of marketers on non-metro cities seems to be well-founded, as the findings of a recent consumer preference survey reveal that the people from so-called class B towns spend on consumer durables and services with the same aggression as their counterparts in metros or mini-metros.

The study, undertaken by television channel CNBC Awaaz along with research organisation AC Nielsen ORG-MARG, shows that the difference in lifestyle expectations, finance matters, attitude to shopping and spending habits of those living in metros and non-metros is fast diminishing.

The research attempts to understand the consumer preferences and buying pattern as the Indian consumer gets flooded by MNC brands not only in consumer durables and cars, but also in categories like insurance, financial services, hospitality and soon even in the retail sector.

The research also notes the changing lifestyle of consumers as they embrace commodities like wheat flour, curd, and others as packaged products in the FMCG sector.

Spread across eight domains "" financial services, FMCG, travel/ hospitality, retail, paint, auto, telecom and consumer durables and over 36 categories in these domains, it is based on the responses of 10,000 consumers in 21 cities in 14 states.

With Delhi, Kolkata, Chennai, Pune, Hyderabad, Bangalore, Ahmedabad and Lucknow forming a part of the metros and Bhubhaneshwar, Kanpur, Nagpur, Indore, Jaipur, Bhopal, Coimbatore, Ludhiana, Baroda and Kochi forming the mini-metros, the research noted that while 56 per cent of respondents in both metros and non-metros are buying more brands, 37 per cent of metro respondents as against 19 per cent of non- metro respondents prefer foreign brands to Indian.

Explaining that the research would be useful for marketers to understand the Indian consumer, Sanjay Bhor of CNBC Awaz said, "The research had quite a few surprises in the travel, automobile and airline category as we understood the preferences of customers."

For instance high-end domestic airlines were preferred by the consumers rather than the low-cost ones. Also, consumers in South and West were seen as more liberal spenders than those in the North."

When it came to shopping and entertainment, again there was not much difference as 34 per cent of respondents in metros and 26 per cent in non-metros said they shop and eat more often at malls.

The rise in those watching more movies and going out more often also was similar, with metros slightly higher at 29 per cent compared to non-metros at 19 per cent.

The spending habits were similar, with 72 per cent consumers in metros saving for the future; just one per cent lower than that in the mini-metros.

Even when it came to taking loans the numbers at 34 per cent in metros and 23 per cent in mini-metros were close and only the use of credit cards for frequent purchases was observed at 16 per cent in metros, double of that in the mini-metros, which stood at eight per cent.

Another category that saw similar spending patterns was health and looks. If 57 per cent of those surveyed spent time on taking care of themselves now, the proportion for mini-metros was 52 per cent.

Forty three per cent in metros spent money in looking presentable, against 37 per cent in mini-metros, the findings reveal, while price consciousness for getting the best deals and saving money stood at 74 per cent for metros and 75 for mini-metros.

It is no surprise then that even the social values were almost the same for the two categories. About 26 per cent of metro respondents said friends were more important than family whereas 17 per cent in mini-metros felt the same way.

The only areas in which there was a wide gap between the two worlds was dependence on technology and television viewing. Forty three per cent metro respondents showed a dependence on technology while 31 per cent in mini metros said they depended on technology.

Sixty two per cent in metros preferred watching television to reading newspapers, the ratio was 47 per cent in mini-metros.

However, advertising influenced buying decisions of both, in metros (57 per cent) and mini-metros (46 per cent).