Consumerism and Rise of Indian Middle Class

7/29/2019 Consumerism and Rise of Indian Middle Class

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Consumerism and Rise of Indian

Middle Class

Course: Business Government and Society

Saumya Ranjan Dash


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Consumerism

Consumerism is a wordwith two meanings:

A movementto promote the

rights and powers of

consumers in relation to

sellers.

A powerful ideologyin which

the pursuit of material goodsbeyond subsistence shapes

social conduct.

Consumer

A person who uses

products and services

in a commercial

economy.


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Consumerism as

an Ideology

Consumerism describes a society in which people definetheir identities by acquiring and displaying material goods

beyond what they need for subsistence.

Long way ahead from the Philosophy of invisible hand:

the self-regulating behavior of the marketplace (Adam

Smith, The Theory of Moral Sentiments, written in 1759. )

The full emergence of consumerism came as economic

changes interacted with cultural and social developments.

Declining influence of religion

The industrial revolution


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Consumerism in Perspective

Marketing research reveals a widespread, profoundeffort to find love, status, and individuality inproducts.

Materialism is an emphasis on material objects or

money that displaces spiritual, aesthetic, orphilosophical values.

Thorstein Veblen, in his bookThe Theory of the Leisure Class(1899), The Theory of Business

Enterprise (1904 challenged theconventional economic wisdomthat consumers bought goods fortheir functional utility.


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Glocalization, the Flat World and

Consumerism The term glocalization is a newly coined blend of globalization andlocalization refers to a concept to describe individual, group, organization,

product or service that reflects not only global standard but also local one.

A combination of the words "globalization" and "localization.

As one Indian executive told us: "Emerging nations used to aspire to have rich-

world products. Now they want rich-world quality in their own products. In theend, businesses that practice only glocalization will fail to exploit the full

emerging-market opportunityto the detriment of their bottom lines and the

economy as a whole. (By Vijay Govindarajan, How U.S. Businesses Can

Really Win in India November 16, 2010.

Reverse innovation.
http://www.businessweek.com/authors/2524-vijay-govindarajanhttp://www.businessweek.com/authors/2524-vijay-govindarajanhttp://www.businessweek.com/authors/2524-vijay-govindarajanhttp://www.businessweek.com/authors/2524-vijay-govindarajan


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Case To Case Basis? Thinking about the

Consumers

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The Global Rise of Consumerism

The ideology of consumerism has risen in Russia, Asia,Latin America, the Middle East, and even Africa.

It may be less a Western than a universal phenomenon,

coming with human nature, economic progress, andcultural change interact at a certain moment in a

modernizing society.

Once it takes hold, consumerism seems irrepressible,

but resistance continues.


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Consumerism and a Rise of Consumer Society

Spread of western consumerism.

High level of material consumption is are closely linked to

identities, aspirations and leisure activities.

Growth of Middle Class having surplus disposable income

So who counts as middle class?

According to organisations like the

United Nations and the Organisation for

Economic Co-operation and Development

(OECD), it's someone who earns or

spends $10 to $100 per day.

http://www.bbc.co.uk/news/business-22956470

The new wave of growth:

Emerging markets surge

Multi Technology Future

The resource economy


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Growth of Indian Middle Class

The base of high-spending middle-class consumers is still small.

The middle middle (spending $4 to $10 a day) and the uppermiddle (spending $10 to$20 a day) together make up just over 50 million people.

This group is essentially part of Indias elite, when contrasted with the rest of the

population, yet barely middle class by global standards.

Indias total household consumption is

expected to multiply four times in just twodecades, between 2005 to 2025, according to

the McKinsey Global Institute.

By its estimates, the countrys middle class

will be 583 million strong by 2025, making

India the worlds fifth-largest consumermarket.

By more optimistic projections, like one by

the World Bank economist Ejaz Ghani, India

will have more than a billion middle-class

citizens by 2025 that is about two-thirds

of its estimated 2025 population.


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Material Values Vs. Higher Values

Commoditization of all parts of life. Do happiness is a commodity?

Consumerism beyond practical needs for emotional reasonsencourage unproductive use of money.

Heavy consumerism worsens the environmental degradation. Can

consumer culture be disposable?

Materialism becomes new national ideology. Division of class in the society: have and have-nots.

It promotes having rather than being. Material goods to communicate

social rank.

Consumerism distorts our values. Vedic philosophy vs. modern daylife.

Consumerism is a pathology of corporate capitalism.


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Consumerism as a

Protective Movement

The idea of collective interest in protecting consumers. Consumer protection is today a major function of government.

Ethical Consumption

Ethical consumerism should be about using our purchasing powerto make the world a better place. Feeling pure will not help the

world's poor.What is not ethical consumerism, The Hindu, Aug 19, 2004.

Legal Structure:

The Consumer Protection Act, 1986

Monopolies and Restrictive Trade Practices Act, 1969

(With subsequent amendments)

Food and Drug Administration


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Concluding Observations

Consumerism is a word with two meanings: it refers

both to a kind ofsociety and to a protective movement.

Consumerism as a way of life is spreading around the

world because the conditions that support it are

becoming more common.

Consumers are now more protected from injury, fraud,

and other abuses than in the past because of stronger

government regulation and more consumer-friendlycommon law doctrines.

Documents

Consumerism and Rise of Indian Middle Class