Socio – Economic Classes

Dealing With India Is Like Dealing

With Many Small Markets At The
Same Time.
 India has a population of over 1 billion and 4
climatic zones 
 Dealing with India is like dealing with many
small markets at the same time.
  Several religious and personal beliefs, 15 official
languages, different social customs and food
habits characterize Indian consumer class.
 An attractive market opportunities: India is
different in culture if compared with other Asian
countries.
 What is SEC ?

 Universally referenced classification of consuming classes created in 1988.

 the classification of Indian consumers on the basis of two parameters :

Occupation and Education of the chief wage earner (Head) of the households.

 Used by most media researchers, marketers and brand managers to understand

the following of a household:
• The purchasing behavior
• The consumption pattern
• Effectively segmenting markets and targeting communication to core
consumers.

 This classification is more stable than one based on income alone and being
reflective of lifestyle is more relevant to the examination of consumption
behavior
 SCIO-ECONOMIC CLASS

B1& B2 18.5%
A large number consists of
shopkeepers. About 40% are
graduates, but most have a
secondary school degree.
A1 & a2 12%
Consists predominantly of
executives officers, professionals
& large businessman. More than
90% are graduates

C 22.9%
D 22%
Principally from the skilled
Occupations similar to C but
working class but a substantial
fewer clerical level workers,
number are employed in
unlike C’s D’s have school
clerical & field positions or are
leaving degrees
small traders

E1 & E2 24.7%
Primarily unskilled workers.
Most have little education and
nearly 50% are literate.
SOCIO – ECONOMIC CLASSIFICATION
i. The Urban Area Segmentation
ii. The Rural Area Segmentation
 The urban area is segregated into A1, A2, B1, B2, C, D,
E1, E2.
OCCU EDUCATION
 
Less than School
Illite- 4 yrs in 5-9 yrs of certificat Some Post-
rate school school e college Graduate graduate
Skilled E2 E1 D C C B2 B2
Unskilled E2 E2 E1 D D D D

Shop owner D D C B2 B2 A2 A2

Petty trader E2 D D C C B2 B2
Employer of-
Above 10
persons B1 B1 A2 A2 A1 A1 A1
Below 10
persons C B2 B2 B1 A2 A1 A1
 Source: Indian readership survey (IRS)
 OCCU
- PATION EDUCATION
  Less than
4 yrs in 5-9 yrs of School Some Post-
Illiterate school school certificate college Graduate graduate
Employer of-
None D C B2 B1 A2 A1 A1
Clerk D D D C B2 B1 B1
Super-
visor D D C C B2 B1 A2
Professio
nal D D D B2 B1 A2 A1
Senior
executive B1 B1 B1 B1 A2 A1 A1
Junior
executive C C C B2 B1 A2 A2

• Source: Indian readership survey (IRS)

 Sections A & B refer to
High-class- constitutes over a quarter of urban
population

 Sec C refers to
Middle-class-- constitutes 21% of the urban
population

 Sections D & E refer to

Low-class-- constitutes over half the urban population
 Sec C constitutes households whose Chief Wage Earners are
employed as :
Skilled workers 33%
Petty traders 12%
Clerk/Supervisor 37%
Shop owners 18%

 3/4th of them have studied till 10th or 12th class while the
remaining 1/4th have studied till 9th class.

 Less than half of the Chief Wage Earners of households belonging

to sections D & E are unskilled workers. Petty Traders are 18%,
while Skilled Workers are about 28%.
 More than 80% of the population of upper strata
consumers is living in the top 7 cities.
 Those top 7 cities are Mumbai, Kolkata, Delhi,
Chennai,
Ahmedabad, Bangalore, and Hyderabad.
 With increase in economic prosperity, this
population (upper strata consumers) is growing at
10 percent annually.
 The rural area is segregated in to: R1,
R2, R3, R4
EDUCATION OF
CHIEF WAGE
EARNER TYPE OF HOUSE
  Pucca Semi-pucca Kuchcha
Professional
degree R1 R2 R3

Graduation/ PG R1 R2 R3
College R1 R2 R3
SSC/HSC R2 R3 R3
Class 4-Class 9 R3 R3 R4
Up to class 4 R3 R3 R4
Self-learning R3 R4 R4
Illiterate R4 R4 R4
 Negatives of SEC
 Based on the assumption that higher education
leads to higher income thus higher consuming
potential.
 For Example :

A trader or a retailer with no qualification can

earn more income than a Post graduate executive,
but SEC will categorize the traders/retailers not
as SEC A1or A2.
 Remedy
 Market Research Users Council ( MRUC) devised another
classification called New Consumer Classification System (NCCS)
which calculates a Household Premiumness Index (HPI) which takes
parameters like ownership and consumption of media services and
products with other demographics.

 HPI considers a wide spectrum of categories from Durables, FMCGs,

Services, which are covered in IRS and scores are assigned in a
scientific and automated method to products owned, consumed/ used.

 In addition to product categories, HPI also takes into account the key
differentiating household demographics, such as, Highest Education
in the household, Number of working members, education of the
housewife, area occupied by the household vis-à-vis the number of
people residing etc.
 http://www.naukrihub.com/india/fmcg/consumer-
class/socio-economic/
 http://www.timm.indiatimes.com/timm/ecoclass.j
sp