The drivers of change in Indian consumer behaviour may seem familiar - rising incomes, increased product availability, shifting demographics, changing lifestyles - but their effects are becoming more fragmented as greater choice and new priorities lead to ever-increasing combinations of customer preferences. This growing diversity is reflected in the increasingly varied shopping baskets of grocery shoppers.
But with so many preferences being expressed in so many different ways, how can you spot the trends that your business can actually profit from? And, once you’ve identified a trend, how do you act upon it?
Take a 3-dimensional approach to segmentation
The first step in solving this complex puzzle of consumer behaviour is to identify those customers - or groups of customers - that really matter to you.
When identifying your target customer it is essential that you don’t group consumers solely by which of your products they buy and the amount that they spend. For example, a mithai brand that saw their high spending customers simply as buyers of premium Indian sweets is not likely to have anticipated the sharp switch to chocolates observed over the recent Diwali period. However, a chocolate marketer that regarded these same consumers as a group that primarily buys for gifting, that wants greater social status among their peers and therefore values things like international brand and quality packaging, would likely have spotted a lucrative and untapped market segment.
To spot these opportunities, companies should look at three dimensions of their customers when building up a profile of their target segment. These three dimensions include; the reason why they are shopping, the need they are seeking to satisfy and the things they value in a product.