How Are Consumers Spending Now?
What’s Down
- Air Travel: With companies leading the way, people are flying significantly less
- Grocery/personal care: Spending has taken a visible hit, slowdown evident
- Apparel/furniture: Discounts are deep but customers are using discretion
- Auto: Terrible sales. The silver lining is that small cars are selling better.
- Consumer goods: Loan growth is healthy, but driven again by deep discounts
What’s Stagnant
- Utilities & Fuel: Despite cheaper fuel, spending on utilities remains constant
- Entertainment: Multiplexes reporting no drop in footfalls, ticket prices up by 10 per cent
- Dining: Though restaurants look empty, overall spends on dining are being maintained
- Liquor: Sales in five-star hotels have been hit, but retail liquor sales have increased
What’s Up
- Mobile: While handset sales are down, connections continue to grow at a good clip
- Healthcare/education: Significant rise in costs as well as loans
- Pockets of affluence: Ultra-rich consumers are insulated from the slowdown
How Are Consumers Investing Now?
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Homes: Wait-and-watch attitude is hurting sales and prices
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Deposits: Shift towards deposits in savings pie. Also, towards public sector banks.
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Equity: Investments in equity, mutual funds down, people looking for safer options—like capital guarantee schemes and gold
Growing Debt Culture
(Personal loan growth between Aug '08 and Dec '08 in percentage)
Source: RBI
Where You Spend Your Money
Source: KSA Technopak, January 2009
Highest Spending On Credit Cards
Source: Industry; figures are % of total spends
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