I spent the better part of a Friday evening two weeks ago in the back of a Tata taking me from downtown Mumbai to the airport. The upside of the traffic was that it allowed me to hear the life-story of my charming cab driver: His father had come to the city with his family in 1950 as a young man and put down initial roots. His dad married below his caste, to the great disapproval of his family; but he didn’t care. He had a desire to do things differently, and he had brought up his son - my driver – with a certain radical mentality. He was a thoughtful soul my driver... He managed to get some education and at the age of 28, went to live and work in Yorkshire for the BBC for a couple of years where he had worked as a camera technician. He returned to Maharashtra state after a couple of years (didn’t like the cold much) and took up work as a taxi driver. He married soon after and his wife bore him six children over the years, the oldest of whom is now at University reading engineering. He lives with his family in a one room dwelling in the city. He works 14 hours a day, 7 days a week and hopes to put them all through university. “It’s not much, but it’s much better than nothing”, he kept saying, laughing raucously.

One of the most interesting things about him was his intense disliking of the caste system. Now, if you live in a culture where many of the major religions tell you that where you’re born and the economic status you’re born into is your lot and that that’s the way it should be, it doesn’t come all that naturally to want to get ahead.

In other words, your karma is what you get in this life...  

And yet my taxi driver, and millions of others, are saying ‘no... what I’ve got in life is not quite enough...’

Following his father’s example, my cab driver felt he

was entitled to aspire to a little more than what his karma suggested was his lot. And he was a Buddhist!

  Now, we’re seeing this kind of argument with destiny an awful lot in India as my colleague Akshay Mathur

from Flamingo Singapore discusses in this edition of FYI.

The Gautam Buddha tells us:  

“All Living Beings have actions (karma) as their own, their inheritance, their congenital

cause, their kinsman, their refuge, it is karma that differentiates beings into low

and high states.”

When we parted, we exchanged e-mail addresses – because, yes, these people are wired too – and he promised to take me on a tour of the Dharavi slums next time.

The Dharavi slums is the Arrival City of Slumdog Millionaire fame. It is on the outskirts of Mumbai, population – 5 million.

Despite appearances to the contrary from our perspective, places like Dharavi, which receive rural migrants, actually improve all of the key measures of quality of life for the people who arrive there.

Now, what is going on here? What is it about migration that gives people this springboard to more…?

…The world impoverishes itself much more through blocking international

migration than any other single class of international policy. A modest

relaxation of barriers to human mobility between countries would bring

more global economic prosperity than the total elimination of all remaining

policy barriers to goods trade - every tariff, every quota - plus the elimination

of every last restriction on the free movement of capital.

The reason migration packs such an economic punch is both simple and

mysterious: a worker's economic productivity depends much more on

location than skill. A taxi driver in Ethiopia's capital, no matter how talented

and industrious, cannot earn more than a few thousand dollars a year.

“The same person doing the same

job in New York City can easily earn

$35,000 a year. The reason people

will pay him that much is that his

driving adds more than $35,000 of

value to the New York economy,

more value than his actions can add

to the Ethiopian economy.” (Michael

A Clemens, Centre for Global

Development)

Migration, allowing the changing of

locations, adds value for individuals

and for economies. It provides

people the opportunity to join the

middle class.

Research Overview 1

Contextual Understanding – Skincare category in China & Japan 2

TVC – Overarching Themes 3

Evaluation of TVCs 4

Evaluation of Print / Outdoor / Online 5

Summary, Conclusions, and Recommendations 6

Appendix – full stimulus 7

THIS IS MY CABBIE’S HERO

Anna Hazare is a 73 year old Ghandian-

he started his hunger strike on August

16th

He demanded that the Indian

government pass strong legislation to

crack down on corruption. He came off

the strike on August 27th

His hunger strike has caught the

imagination of a whole generation of

people who are not prepared to

accept their karmic destiny – who want

a piece of India’s boom action, who are

sick of the huge corruption scandals

that are now common.

RESEARCH OVERVIEW

1 AND THIS ACTION OF THE ‘MIDDLE

CLASS’ ISN’T ONLY IN INDIA

Last month, a demonstration in China – the

biggest since Tiananmen Square, in the

northern city of Dallan

Middle class people demonstrating against

continued operation of a factory believed to

be leaking toxic chemicals.

RESEARCH OVERVIEW

1 MIDDLE CLASS REVOLT IS

HAPPENING ALL OVER CHINA

When this train crash happened and the

Government tried to bury the evidence, the

state-owned news channel protested – live on

air!

RESEARCH OVERVIEW

1

New President of Brazil, Dilma

Rousseff, has since June, fired

various of her most senior

ministers, including her chief of

staff. Some were arrested.

She had to respond to the

growing middle class that

demands that things be done

properly. The middle class has no

patience for corruption and

incompetence.

These are the people

changing the complexion

of the world.

So who are these middle

class people?

11

One definition of “The middle

class” is those earning between

$2 and $20 a day. Often these

are people only just out of

poverty.

According to the Economist, hey

account for ⅓ of Africa’s

population in 2008, ¾ of Latin

America’s, and 90% of China’s.

As growth in the US

and Europe falters,

there’s increasingly

more interest in the

middle class of Africa

and Asia and the

daily couple of

dollars they have to

spend.

That’s 2 billion people

to target.

So how are brands talking to them?

Cycle film For sure, there’s a little poetic licence

going on here...

But it’s a story that has caught the

imagination of middle class Indian TV

audiences and has achieved

tremendous tracking numbers

The hero of the ad is confident he

can get ahead – going places on his

bike.

The city holds all the possibility that

this boy’s story alludes to; the ad taps

into the new urban Zeitgeist.

The question, as the narrative so

cleverly exploits, is not about

where he’s come from it’s about

where he’s going.

Cycle film

Cycle film

Getting around town easily is highly important

to the new emergent city dweller.

You need easy transport in order to take

advantage of opportunities, to utilise your skills

where they are needed.

Now this one here only costs $675. The genius

of the Italika is not just that it’s cheaper

because it uses Chinese parts and is

assembled in Mexico to avoid import tariffs.

The really clever thing is that the whole sales

model is geared towards making it readily

available to the new urbanites.

Now, in our business, here in the West, we tend

to set a lot of store by imagery. But if we’re to

understand these people, we need to

understand far more than just their aspirations

and their views and their aesthetics... we need

to be a bit clever about their circumstances...

Cycle film These bikes can be purchased with weekly payments of 100 pesos – that’s 5 quid! New migrants have plans, aspirations, and a desire to put talents to work – but they’re not cash rich. Italika offers weakly payments spread over two years. Simple, yet brilliant. Here’s a company that has understood the particular circumstances of this emergent class of people. The really clever part: if you can’t get credit because you have no proof of income (which is common with the large informal sector) the finance company will visit your home to set up the deal. There is a competitor in Mexico – the Indian Bajaj – considered to be a better product, but it’s harder to get the finance. There’ve been a million Italikas sold in Mexico, and with expansion into Argentina, Peru and Central America already underway, Brazil is the next prize.

Cycle film

To China, where the life assurance category has grown from $10 billion to $88 billion in the space of 12 years... Most of those new to urban life were working class only a generation ago – they are only just becoming affluent enough to invest. For these people, insurance products - which offer a guaranteed 2.5% return – are attractive but what makes them compelling is that they are sold face-to-face by agents countrywide. (China life has over 700,000!) Neighbourhood salespeople who develop face to face relationships of trust with customers and their families and the referrals that follow. In a country where state social insurance is nowhere near as all-embracing as it once was, this means a huge new emerging market. Some are predicting annual growth of 20%. Getting into these communities and selling face to face, building relationships of trust, may be where brands are doing best.

Only three examples, from three corners of the world. Connecting with the new urbans by building imagery that taps into their needs and aspirations. Connecting by providing products that fit their needs at the right price. And connecting by finding channels for selling that suit their customers’ circumstances. Examples like these can be found all over the emergent world. We are seeing Body Lotion users in rapidly growing Jakarta coming face to face with a whole array of ethnicities and influences becoming much much more demanding of the efficacy of the products they use. We are seeing the growth of anti-bacterial personal care categories as consumers become increasingly aware of the need for hygiene in overcrowded urban environments. We are seeing the rapidly growing numbers of diabetics around the world taking control of their condition with cheap and accurate blood glucose monitors, not having to rely on dodgy clinics, sent by the local quack, who takes a cut for the privilege As growth falters in the developed world, marketers must be talking to these people – capturing their aspirations, understanding their roots, and learning where they are heading. What are the key rules for the road?

1.  The transit from rural to urban "Arrival

Cities" (the first stepping stones into urban life) will, for the most part, result in slowly rising living standards. It may not happen overnight but all the trends are there – there's huge growth potential for providers of goods and services who can meet their needs

2.  "Emerging middle class" doesn’t necessarily mean 2 cars, dishwasher and holidays in Tuscany.  There are millions whose transit to arrival cities around the world has lifted them just out of poverty such that they can aspire to various goods and services that their rural lives didn't permit them

3.  Mobile phones and network providers are those who have made the best early successes in tapping into the market for these people

4.  But the success of the Life Asssurance industry in China and brands like Italika in Latin America, who know how to get up close and personal with these targets, and find products and sales models that fit their needs give us clues as to success stories to come

5.  One example: As more women enter the workforce, there is likely to be a growth in fast food solutions and convenience foods

About the Author

James Parsons is Managing Director of Flamingo in Asia and is based

in Singapore. He joined Flamingo in 1993 and in that time has led research projects and developed our offer in categories as diverse as

automotive, IT, foods, personal care, alcoholic beverages and medical devices.  

In 2007, James set up Flamingo Tokyo from scratch and grew it to a thriving business.  In 2009 he took on the Asian regional role and this

year moved to Singapore closer to be closer to  the epicentre of the world's most dynamic region. He has a deep personal and

professional interest in the people and cultures of the great emerging economies and the growing opportunities for brands  there.

James.parsons@flamingo-international.com

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