Of household spending patterns

While the Chinese spending will take another step due to rise in income levels, the South Africans might still stick to food and clothes due to financial constraints. And the Indian eating habits for the wealthier might be changing to swifter, prepared cereals.
The collaborative work by Economist Intelligence Unit and Mintel on the consumer spending priorities in fast-growing emerging markets offers interesting insight about this giant-like segment to not only the readers but also the companies while devising their product or/and branding strategies.
While comparing the worlds fastest growing emerging markets with the developed world, some convergence amid various divergences have been shaping up as some products become more affordable worldwide. However, cultural factors, regulations, and marketing efforts continue to make the differences between markets stark.
The developed markets, as expected, are moving from the basic necessities like food towards higher end spending like fizzy drinks, eating out etc. However, the growth shall definitely be reined in by the recessionary strings.
Some of the clear shifts in the spending patterns amongst the emerging markets include how these markets are shifting towards packaged and prepared food. Whether it is for the people or the pets, it is especially true for Mexico, India and China due to rising affluence.
At the same time, household essentials and products is another category that has seen converging trends particularly in homecare and personal care subcategories in China, Turkey and India.
While clothing will remain slow due to depressed cotton prices, China, India, and South Africa will spur growth in this segment when and if the wages in textile countries begin to inch up.
While responding to BR Research’s question regarding the spending patterns in Pakistan in the coming years, the analysts for the Mintel and EIU collaboration demonstrated optimism for growth and consumption within the country.
Mainly, the primary consumption categories like food and household essentials like detergents and washing powders are expected to grow fastest even amid the all the challenges that the country is fighting.
However, the analysts also opine that the country still lags far behind the next generation of consumption and spending, as basic necessities account for a sizeable share of the country’s total expenditure, leaving very little room for other purchases of luxury, indulgence or even recreation.

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CONSUMER SPENDING PRIORITIES: EMERGING VS. DEVELOPED MARKETS

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China            India              Mexico          S. Africa               Turkey           USA             UK

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All tea          Cornflakes, but    Pet food and    Coffee and clothing,    Sun cream and    Fizzy water,    Chocolates and

and detergent    no dishwashers     snack food      via computer            appearance       fizzy wine      other cheap treats

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Source: Convergence with divergence, A special report from the EIU and Mintel.

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