Why She Buys (18 page)

T
HE
I
MPORTANCE OF
F
AMILY

Family is the most important aspect of Indian life, and this is reflected throughout Indian culture, including the thousand or so Indian films that are produced every year. The concept of a nuclear family is new to India and is being driven by the increasing wealth of the middle classes. Most people live in extended-family arrangements, but young people with “new” money and career women are establishing beachheads for the concept of living as a nuclear family.

Men are kings of the Indian family, and a baby boy is what every young woman wants and is often pressured by
her family to produce. Society tells women they should have sons, and the message is not so subtly conveyed in advertisements, on television, and in movie plots. In fact, the problem of aborting female fetuses is so widespread—especially among the most affluent classes—that the government of India passed a law that’s made it illegal for doctors to disclose the sex of a fetus to the parents during an ultrasound.
⁴¹

Men are accustomed to being waited on by their female family members, which is why it can be difficult for more traditional men to accept their wives going off to the workplace. Their parents also expect to be taken care of by their new daughters-in-law, so women have pressure coming from all sides. From the male perspective, men have little to gain when their wives go off to work. As magazine editor Vasudev puts it, “It’s hard for men to give up the crown.”

U
RBAN
V
ERSUS
R
URAL

A wealthy person in Mumbai has more in common with someone from New York than with someone from rural India. Something on the order of 30 percent of India’s citizens live on less than a dollar a day, while others live like royalty. The eight megacities of India where most Western companies have focused their efforts are Mumbai, Delhi, Kolkata, Hyderabad, Bangalore, Chennai, Ahmedabad, and Pune. However, there is new interest in smaller cities, which are full of people who may have more time on their hands than the busy folks in the big cities and who have plenty of aspirations. On conservative estimates, 379 million people will be added to India’s urban spaces over the next forty years—more than the entire population of the United States today.
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T
HE
M
ODERN
I
NDIAN
W
OMAN

From a commerce perspective, Indian women have been understudied, but things are changing, and old stereotypes are starting to give way to reality. “Indian women are seeking ‘space retrieval,’ which is their own individual space in the world, but not at the expense of someone else,” explains Santosh Desai, CEO of Future Brands and one of the country’s best-known advertising professionals. “Before, there was nothing left over for a woman; she was exhausted by all her duties,” he says. “Now there is something left over for herself. This is a change. There is a sense of confidence and self restraint that comes from being able to navigate the world.”

R
ETAIL IN
I
NDIA

Credit card penetration is low in India, and this impacts consumers’ ability to make large purchases on credit. Online shopping is not popular yet. For Indians, at least for now, shopping is a visceral experience, with people jostling elbow to elbow for the best bargains. Shopping in India is all about energy, crowds, and hubbub. Many Indians view Western retail as boring and passive. As Future Brands’ Desai puts it, “In India, we just don’t respond to the concept of retail as art installation.”

The bottom line is that with higher rates of female employment, dropping fertility rates, and a fast-rising middle class, the drivers are in place for women to play an even greater economic role in India. The challenge for international businesses will be to appeal to India’s strong sense of culture and pride. Mumbai-based, American-born Roopa Purushothaman, currently one of the rising young stars in the world of economics, explained a popular saying to me. “No one ever comes here and changes India,” she said. “You come here and get changed.”

60-
SECOND
OVERVIEW

T
HE
W
OMEN OF
C
HINA

M
odern China has placed an emphasis on gender equality that is unique among countries. Chinese women have been in the workforce ever since 1949, when Mao Zedong took power and declared, “Women hold up half the sky.” Mao established equality between the sexes (at least theoretically) under Communism. Nearly all women who wanted work found employment in state-run factories, which offered free schools and day care for workers’ children. Women found themselves with jobs in engineering, science, the military, and agricultural work.

In the 1950s and 1960s, when the stereotype of June Cleaver–style housewives was grabbing hold in the West, China could not have been more different. Its women marched off to work in gray Mao jackets and hats while singing songs in praise of the Party. Then the Cultural Revolution began in 1965, ushering in a tumultuous era of violence and fear. In 1979, the one-child policy was enacted to curb the population explosion. Then, ever so slowly, China started opening up its big red gates to the world.

Y
OUNG
W
OMEN
D
RIVE
C
ONSUMER
G
ROWTH

Fast-forward to today. Urban Chinese women are driving the consumer goods explosion in China. Walking through the streets of Shanghai, I felt an overwhelming need to increase my fashion sensibility just to keep up with all the trendy women rushing through the streets, talking animatedly on their cell phones. In particular, women ages thirty-one to forty are the most powerful force to be reckoned with. They outspend all others on beauty, entertainment, travel, cosmetics, clothing, and books.
⁴³
These women crave luxury products and brands, and dress themselves in status symbols to show the world they’re successful.

Their younger counterparts, the first generation of children raised after China’s one-child policy was enacted in 1979, are now spending money alongside them as they fill the ranks of the urban Chinese workforce. Chinese women are embracing the kind of self-expression that once was unimaginable in this country—from fashion, art, music, and blogging to writing openly about sex and money. There is a generational divide between women over forty, who lived through the deprivations of the Cultural Revolution, and the younger women who have come after them. The former are more apt to save money in case the bad times return; the latter want to spend it because they have only experienced good times.

A G
ENERATION OF
“L
ITTLE
E
MPERORS
”

Women born after 1979, who are now age thirty and younger, grew up in a different world than their older counterparts. Raised as only children, they’ve had the benefit of six adults—one set of parents and two sets of grandparents—involved in every aspect of their lives. Thus they are accustomed to being on the receiving end of adults’ attention and money. This generation of kids has been nicknamed the “little emperors” and is considered to be spoiled—especially the boys. Because they live with their parents until they get married, these young people often have proportionally more disposable income than their counterparts in other parts of the world, who have to pay for rent and food. The resulting explosion in young women’s spending has been characterized in the international media as the “pink yuan.”

With China’s vast aging population, however, it’s not
just the younger women who have the money. Empty-nester women are predicted to have U.S. $150 billion of purchasing power in 2015, while their younger counterparts will likely have U.S. $260 billion in spending power in the same time frame.
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The health and beauty industry is feeling the impact of all this spending because it’s the first point of entry for women who want to buy luxury brands. Very few companies are paying attention to the forty-plus market in China, and these women represent an enormous opportunity, as they do in Western countries.

W
OMEN
S
PEND THE
F
AMILY
M
ONEY

Like India, family is the axis upon which China revolves. People live in extended families with their parents and grandparents and feel a strong sense of responsibility for the well-being of their family’s older members. Like everywhere else in the world, women are the shoppers in Chinese families. An estimated 78 percent of married women make the decisions for grocery, apparel, and other essential purchases for their families, and 77 percent say their opinions are important when it comes to buying big-ticket items with their husbands.
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With the one-child policy still in place, families remain small, and women find it relatively easy to stay in the workforce after childbirth. (There is usually a grandparent around who can help with child care.) A study from the China Women’s Federation and the National Statistics Bureau shows that even if they had a husband with a high salary, 88 percent of women would choose to work.
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N
O
T
HANKS
; M
AYBE
L
ATER?

More and more urban Chinese women are postponing marriage and children. The average age of first marriage is twenty-six for women in the capital, Beijing—about two
years older than a decade ago.
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The country is facing a social time bomb in the years to come, since the preference of Chinese for male children means that young men now dramatically outnumber young women. There are currently 121 boys for every 100 girls.
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Along with delayed marriage comes the phenomenon of divorce, which is rising in Chinese cities. Many urban divorces are blamed on the rise of mistresses, who are called
ernai
. Mistresses have become a status symbol for successful Chinese businessmen. In fact, there are many who believe the “mistress economy”—the habit of buying gifts for one’s mistress—is the single biggest factor driving the adoption of luxury goods in China’s big cities.

In both China and India, middle-class women have latent needs—they don’t necessarily know what they want yet, because they haven’t been exposed to many of the products and services we take for granted in the West. Multinational companies are now skimming the top of the population for wealthy consumers, but the greatest opportunities for both countries are with the “smaller” cities (a relative term) and the rising middle class. The size of China’s burgeoning middle class is hotly debated, but by some estimates it’s predicted to reach a hundred million by 2016, up from thirty-five million today.
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Whether It’s Beijing or Baltimore, New Delhi or North Carolina, Women’s Consumer Domination Is Here for the Long Term

T
HE
global trends driving women’s educational attainment, workforce participation, and subsequent purchasing patterns mean that women are expected to dominate the consumer
economy for the next twenty-five years or longer. Studying the trends among women of all age groups will lead to a better understanding of how to deliver the goods and services that women want. As you begin the process of catering to the alpha consumer, keep in mind the new paradigm of the female consumer world order: