Unlike the middle child, who is often jokingly considered the ignored offspring, the middle class has always been of profound interest to economists and marketers alike. They are expected to be numerous and by the virtue of their size alone have become the backbone of the economy and the brands. They provide volumes, massive potential to be upgraded and upvalued, and have traditionally been thought of as conformists.
However, who or what is middle class in India specifically? How do you define them? Is it basis annual income? The definition then ranges from 3500K USD to 35000K USD, depending on who you are listening to. Is it basis ownerships? Is it basis the ability to spend on children’s education? Go on holidays? Or is it simply a mindset or values? Estimates peg middle class at 30% of the population but seen from the lens of shared values, almost everyone barring the top & bottom 5% would identify themselves with middle class.
What are the middle-class values? Simply put, prudence in everything so as to feel safe, secure and comfortable. Always aspirational but rarely overambitious.
This mindset or cohort, whichever way you like to think of it is perhaps becoming more inscrutable and not as easy to please as they perhaps have been in the past. This is led by that the middle class themselves are facing fundamental changes:
1. Nuclearization: Joint families were backbone of middle-class India in the last century. Multigenerational units where elders clearly held the reins, and the younger generations followed. With greater urbanization and aspiration for better lives, the migration of younger generations to bigger towns and metros in search of education, jobs and independence, joint families have broken up. As per Kantar World Panel, small households now form 50% of India, up from 37% in 2008. Their per capita spends and consumption are two times that of larger families.
2. Changing values: Middle class values are changing notably in different groups within the larger cohorts with aspiration changing shape, especially post-covid. Lalita ji is more likely to be found in a salon while the father maybe cooking pasta for his daughter without the mother in sight. Middle class GenZ is under similar influences as their global counter parts – K pop, K noodles and K skincare. But the realities of the small-town GenZ ambition differ greatly from the metro GenZ’s cynicism and endless experimentation.
3. Overinformed and overanxious: An ever-present anxiety, unlike the hope of the 90s, runs through the daily lives. Inflation, job scarcity is creating a middle class which has a strong exclusionary core. Messaging to this middle class has to be within the boundaries of “culture”. Conflicting, continuous messaging on social media and WhatsApp groups about what is healthy, ethical, fashionable, trending, profitable, career worthy, depressing is making decisions incredibly difficult and adding a constant fear of not just missing out but doing something unacceptable. When content like Netflix’s British series Adolescence comes along, the confused and over-informed Indian middle-class parent finds the possibility of an overstimulated thirteen-year-old boy killing a girl chillingly familiar.
4. Inequality and price-worthiness: The poorest 5% of India spend merely an average of Rs 46 daily in rural areas and Rs 67 in urban areas, as against the richest 5% whose daily consumption is Rs 350 in rural areas and Rs 700 in urban parts, indicating a huge inequality in incomes, as per the All-India Household Consumption Expenditure Survey 2022-23 that the Union government released. People in the middle are willing to spend more but on what they feel is worth the price and that is not equal to ‘cheap’. The growth of SUVs even at entry level, increasing the average selling price of cars in India, while CPG sector is struggling to grow at fast pace is the prime example of the ‘price-worthiness’ mindset. The famous ‘kitna deti hai’ (what’s the mileage) Maruti ad may well transform into ‘aur kya kya deti hai’ (what are the latest features it has), with the demand for sunroofs and smart entertainment screens in cars.
5. Spiritual consumerism: People are increasingly taking refuge in faith and religiosity to cope with uncertainty and worry. The combination of consumerism and public display of spirituality is what fuelled the Rs. 3L Crore revenue (as per government) generated by Maha Kumbh. There is greater protectiveness towards ‘culture and tradition’ of faith and nation. As a result, brands while intending well may still get their messaging wrong. Tanishq’s interfaith ad received backlash, with a section of conservative social media calling for brand boycott. Brands that are sensitive towards the evolving cultural expression codes are likely to thrive more than those who do not.
What does it mean for the marketer?
Consumption as aspiration
In the past, middle class consumption was safe and within the parameters of needs. Today’s middle India’s consumption is driven by want more than need.
Social media is exposing them to experiences that seemed distant and e commerce is bringing products home. Tips and tricks to experience luxury on budget abound on social media and so do the enviable hauls on this website and that. If weddings, festivals and religion were societal earlier, now they are the lifeblood of social media.
Meaningful and memorable experiences are craved in the new aspiration. Data from Kantar Global Monitor indicates that consumers are willing to spend on holidays abroad, trendy places to eat and drink, and spontaneous activities. Kantar’s India in Search report shows 45% YOY growth in Google search for experiences with 57M searches every month on average. Premium CPG categories have remained insulated from the slowdown, offering distinct value through elevated experiences, specialized benefits, or more convenience.
GenZ consumers whose parents are making more money than any generation of India till now are particularly aspirational, seeking trusted brands that resonate with their values and lifestyle. They are willing to pay a premium for ‘their’ brand. An example of this would be the booming Sneakerverse where Nike still rules but homegrown brands like Comet have become equally aspirational through high quality, smart and new age product, branding and marketing.
As per BCG-Snap report, Gen Z spends are likely to touch ~1800 bn USD by 2035.
Women OWN aspirations
Indian women are coming into their own, learning to feel less guilty, being more independent, and modern while also taking pride in traditions. They are finding time for themselves, with an increase in activities such as holidays, eating out, and attending live events. Women are mixing and matching values, lifestyles, and fashion, embodying multiple identities that shape their needs, desires, and choices.
More women are pursuing higher education and achieving financial independence. The percentage of women owning debit cards has increased from 14% in 2019 to 39% in 2024. Similarly, investments in mutual funds have seen a rise, indicating a growing sense of financial autonomy. The recent ad by Franklin Hamilton depicts this increasing confidence of women in making financial decision.
This financial autonomy means Vimla or Sheela may still bargain on a detergent or atta but are willing to splurge on themselves. E-commerce has given them the means to do so without leaving their house. Meesho, Flipkart have tapped into these emerging aspirations of small-town women, converting them to a powerful consumer group.
Tradition and modernity in Indian women’s choices used to be at loggerheads like old saas-bahu TV dramas of nineties but today they co-exist in the form of co-ord sets, saris with sneakers and solo trips. Acclaimed actor Shefali Shah expresses this best in an Instagram post on her own solo vacation.
Middle class man is recalibrating his desires
One of the striking category growth stories in recent history has been of SUVs, conventionally considered masculine. It is today close to 2/3rd of pax car sales vs less than 20% pre-Covid. Entry level SUVs have made the form more affordable but what about cars that are normally used for off roading makes it an urban middle class choice? Besides our bumpy roads, SUVs announce the owner loudly, desire for dominance etched in its masculine form. The owner was expected to be manly but that too is changing with Mahindra ad showing a woman off-roading with a man with confidence and daring. Masculinity is getting re-framed for the Indian middle-class man; mostly leaving them perplexed. The 2024 blockbuster Animal is an expression of this confusion.
Kantar’s Un-Stereotype metric that monitors progressive gender portrayals has found over the last 2-3 years, while female representation has improved, the roles still remain most gender specific.
Men are also a lot more conscious of how they perceive their bodies, evident in proliferation of gyms and growth in male grooming categories.
Middle class families are changing form
Covid shaped the middle-class families into independent units living within their screens in a connected home. The structure of family life and the routine of a middle-class day has changed permanently. All of them are digitally literate and consuming different content across different platforms. The idea of family viewing TV prime time has undergone a dramatic shift. Now, family TV time is a choice, exercised less often than before.
They mostly come together to watch cricket and order food in home. What they also likely have in common is declining consumption of print and the printed word. This has implication for messaging as the stereotypical middle-class family may not sit around the dining table to decide the next purchase. The cohort targeting therefore is critical.
In conclusion
Middle is a mindset and value system that is under churn. It is more diverse with higher aspirations and desires than ever before, making marketing to them more complex. It is a greater challenge for marketers who are looking to win by simplifying understanding through reductive cohorts (GenZ, Women, Middle India, Small Towns), discounting diversity of motivations within each and focussing on immediate connects and returns.
To be consistently successful, brands require a nuanced understanding of the shifts in socio-economic pyramids, trade-offs being made by consumers, and their evolving aspirations. Brands that can navigate these dynamics effectively will be better positioned to capture the attention and loyalty of this critical segment. Brands will need consumer led brand building and not just performance marketing.
This paper merely touches upon the shifting trends and motivations of Indian middle class. A savvy marketer or even CEO would dive much deeper, longer, strategizing and sizing this massive population that is demanding value – for its time, its attention and its money – more than ever.
The article was first published in WARC.
