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<\/a><\/p>\n <\/p>\n <\/p>\n Where is the Indian consumer today compared to 10 years back?<\/strong><\/p>\n <\/p>\n <\/p>\n This segment is young, democratic in its thinking, and wants to \u201cfit in\u201d.<\/p>\n They will buy organic. They will also buy frozen for convenience.\u00a0 The frozen french fry at home costs Rs 10 \u2013 at McDonalds it costs Rs 30 \u2013 they see value in both formats.<\/p>\n Value for the customer of today is CONTEXTUAL. That\u2019s the single biggest change.<\/p>\n Is consumption in India de-growing?<\/strong><\/p>\n We are growing at 20%.\u00a0 Previously,\u00a0 growth rates of 30 to 40% were common. That does not mean de-growth.<\/p>\n In the last 5 years, countries such as Philippines, Thailand, China, Indonesia and India have seen similar growth rates in consumption.<\/p>\n In an Asia Pacific context \u2013 a 20% growth rate is good. Its very good.<\/p>\n Do you see the frozen french fry as competition?<\/strong><\/p>\n Our reference point is the QSR category.\u00a0 People in India still eat out less than 8 times a week \u2013 versus 28 in Thailand. So we see immense market potential.<\/p>\n <\/p>\n <\/p>\n <\/p>\n Are you surprised by the pace of consumption in India?<\/strong><\/p>\n \u201cI\u2019m a DND man\u201d \u2013 [DND = markets other than Americas, Western Europe and Japan]<\/p>\n None of the CPG categories are anywhere close to maturity.\u00a0 Take laundry. We went from cottage soaps to machine produced soaps, to whiteners and now to Comforters.<\/p>\n Different sub-markets in India are making this transition at different speeds.<\/p>\n Even where you have adoption, there is scope for growth from both penetration and from increasing the frequency of consumption.<\/p>\n Does government have a role to play in retail?<\/strong><\/p>\n The government\u2019s role is\u00a0 to encourage consumption.<\/p>\n This is only possible when they realize that<\/p>\n MORE Consumption = Good Development.<\/p>\n More consumption = More manufacturing = More Turnover = More Taxes = More Revenues = More Growth = More Consumer confidence = More Consumption.\u00a0 Governments role is to recognize this cycle.<\/p>\n Can you recall any legislation by the Government which catalyzed Consumption?<\/strong><\/p>\n Indians have superior commercial instincts, once they have a framework, they don\u2019t need the government to grow.<\/p>\n <\/p>\n <\/p>\n Is democracy a stumbling block to consumption?<\/strong><\/p>\n Between 2003 and 2013 \u2013 Indians increased their eating out from 3 times a week to 8 times a week. IN Thailand its 42 times a week.<\/p>\n In\u00a0 China we are opening 300 restaurants a year. In India \u2013 its 30 restaurants a year.<\/p>\n Democracy has nothing to do with it. Its about growth and \u201ctipping points\u201d.<\/p>\n <\/p>\n <\/p>\n What will drive growth in emerging markets?<\/strong><\/p>\n Market penetration in this category is low so you will see explosive growth.\u00a0 Markets like Thailand and Philippines consume 30x what India does in personal care \u2026. Tremendous headroom.<\/p>\n The most relevant channels for this are Modern Trade and E-tailing so these channels will see high growth.<\/p>\n What we look at when we review a market is population, money, growth and most importantly consumer confidence.\u00a0 In India, the slowdown has not impacted money in the wallet as much as it has confidence.<\/p>\n What categories will drive growth in your business?<\/strong><\/p>\n Other categories which see high growth are \u201coccasion wear\u201d and fast fashion.<\/p>\n <\/p>\n <\/p>\n <\/p>\n Non retail channels \u2013 example birthday parties, and social media to recommend experience.<\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n What\u2019s so big about BIG Data?<\/strong><\/p>\n Your ability to use \u201cconvergence\u201d technology and mass customize the brand experience is what creates consumer relevance.<\/p>\n Customers are INDIVIDUALS.\u00a0 The experience of AAP (Aam Aadmi Party) shows that they want to be treated as individuals.<\/p>\n For us, BIG Data helps enhance our ability to understand shopper mission and answer the question of \u201cwho is the shopper in the \u00bd km catchment\u201d \u2013 then target him with range, assortment\u00a0 and promotion.<\/p>\n Role of the small retailer<\/strong><\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n Advice to young retailers?<\/strong><\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n<\/a><\/strong><\/p>\n<\/a>Previously our addressable market was 30 crore Indians. In the last 10 years, another 15 crore new voters have come in.<\/p>\n<\/a>You need to contextualize this.\u00a0 McDonalds India,\u00a0 has the highest rate of Same Store Growth\u00a0 – globally.<\/p>\n<\/a>No. Anything which grows the category is good for the market.<\/p>\n<\/a>No.\u00a0 The shift of power from West to East has been clear for a while now.<\/p>\n<\/a>In some ways the government is struggling with the \u201cGandhian\u201d dynamic \u2013 that of non-consumption.<\/p>\n<\/a>The role of the government to enable. Without getting into FDI debates \u2013 they need to adopt a \u201cCompassionate Capitalism\u201d framework.<\/p>\n<\/a>At 7% GDP growth, the country see\u2019s prosperity.<\/p>\n<\/a>As people have more discretionary money to spend \u2013 personal care and beauty takes up some of the spend.<\/p>\n<\/a>Breakfast Foods,\u00a0 frozen foods, chocolates and yes personal care and beauty.<\/p>\n<\/a>For QSR it\u2019s the shift to online for home delivery, Mobile ordering.<\/p>\n<\/a>Gives you the ability to personalize marketing.\u00a0 It\u2019s granular marketing at its finest.<\/p>\n<\/a>The small retailer is the smart retailer.\u00a0 Modern retail will serve the top 30% of the consumption pyramid,\u00a0 the 300-500 SKU retailer will serve the rest.<\/p>\n<\/a>92% of retail is non-modern.\u00a0 To harness these, the key will lie with manufacturing. There is a need to focus on productivity and innovation in manufacturing to service this retailer \u2013 in the face of increasing cost of doing business.<\/p>\n<\/a>Use technology to personalize. Build brand relevance.\u00a0 Go long on Consumption.<\/p>\n<\/a>Tremendous potential to grow consumption. Surf the coming wave.<\/p>\n<\/a>Invest. It\u2019s the bottom of the cycle.<\/p>\n