Non-metro markets to propel India’s recovery: EY Survey

Non-metro markets to propel India’s recovery: EY Survey
Non-metro markets to propel India’s recovery: EY Survey

In the face of unprecedented economic disruption caused by the COVID-19 pandemic, non-metro markets are likely to recover faster than metro markets, an EY survey finds.

The EY report, titled ‘Will non-metro markets propel India’s recovery’, reveals that a higher percentage of respondents from non-metro markets expect to spend more than before on several categories compared to metro markets, indicating that when the lockdown ends, green shoots of recovery would probably sprout faster from the non-metro markets.

The survey covered a varied demographic mix of more than 4,000 respondents (2,000 each from metro and non-metro markets) to understand the potential impact of the pandemic from the consumer sentiment perspective. It covered key aspects linked to the current and expected attitudes, behaviours and spending trends of consumers as they adapt to the new reality.

Ashish Pherwani, Partner and Media & Entertainment Leader, EY India, remarked, “The COVID-19 pandemic has radically shifted our way of life. However, despite uncertain and challenging conditions, our research shows that non-metros express a higher degree of resilience and a resolve to bounce back quicker compared to the metros. We may see long-term and even permanent changes in consumption patterns.”

The survey results reveal that the pandemic and the ensuing social distancing measures put in place have led to fundamental changes in how Indians are consuming media, necessities, luxury productseducation and travel.

Some of the key insights from the survey include:

  • Health, hygiene and online services will continue to grow.
  • While COVID-19 has impacted overall consumption, categories like heath products, household products, hygiene products, vitamins and supplements and online services (gaming, home entertainment, online education, online banking) are expected to benefit.
  • Non-metro market recovery is expected to be faster than metro recovery.
  • Categories like consumer goods, travel, entertainment, automobiles and white goods are all expected to see increased and faster recovery of demand from non-metro markets post the lockdowns.
  • Increase in digital adoption: Digital trials increased significantly during the lockdown period. However, adoption was higher for metros vis-à-vis non-metros. Some of the obstacles stated by non-metro respondents included lack of technological knowledge, absence of smart phones and fewer language interfaces.
  • Newspapers remain the most trusted medium: The impact of coronavirus has unfolded at a dynamic rate, causing a sense of urgency to absorb information, increasing the consumption of news coverage at unprecedented levels. Newspapers continue to remain the most trusted news source. 42 per cent of the respondents in non-metro markets spend more than 20 minutes in reading a newspaper, compared to 36 per cent in the metros.

Along with these, the survey found that fraud and data theft continue to be the largest concerns across metros and non-metros, while limited knowledge of usage and lack of devices still impact non-metro markets.

COVID-19 could have some significant and even permanent change to consumption patterns. The study of alternative consumption options indicates that more people will consume in-home entertainment as compared to out of home entertainment options for some time to come, for example. Other interesting analyses include staples vis-a-vis luxury products, transportation options, etc.

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