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CUSTOMERS | Elites: Research identifies “Elite” households

 

They spend more on FMCG than others

 

Indian marketers rely on a Socio-Economic Classification (SEC) system to place households into a hierarchy that helps organize the market and facilitate planning. Households belong in one of five classifications (A to E plus subgroups) determined by the education level of the household head and the number of durable products owned.

 

A new report by WPP’s Kantar Worldpanel concludes that the expansion of wealth in India is outpacing the recently-revised SEC system. The report—Crystal Gazing: Did you see this coming? —

identifies a group of households with a significantly greater spending profile than highest SEC classification—A1.

 

The A1 households own least nine durable products and the head has more than a college education. In a comparison of FMCG purchase occasions and average FMCG categories purchased per trip, the report found no difference between A1 households and other relatively wealthy households that own somewhat fewer durable products and where the head may be less educated.

 

However, by adding a few more criteria to the A1 classification (owning a car and computer, and traveling abroad), the report identified a sub-classification of wealthy Indian households differentiated by its higher spending—an A1+ group. Labeled “Elites” by Kantar Worldpanel, these households spend significantly more on FMCG than other relatively wealthy Indian households.