UNLIKE the post-independence middle class that was defined by its major constituent of salaried employees of government, public sector and a few large private sector enterprises, and had a largely uniform approach to life and living, the so called new middle class is vastly heterogeneous. It is no longer a group of people that can be defined either by dominant occupations or education levels, or by their sensibilities or values and attitudes, or world views. While our mental model of the new middle class is that of a singular splendid exotic creature like never seen before, perhaps a phoenix, rapidly growing in size and resplendence, the fact is that it is actually a big unexceptional basket comprising electricians, carpenters, plumbers, doctors, IT types, bureaucrats, shopkeepers and traders, farmers, teachers, social activists and everyone else that you can find in India. The only thing they have in common is that they have the income and the aspiration to consume.

The aspiration to consume is not a distinctive trait of the middle class, but one that is common to all classes in India; and it is not some generally vague desire for a better life, but a rather specific and concrete wish list of long and short term things that need to be done/seen/acquired/planned for the next. With so many new things to experience and benefit from, both in terms of pleasure and purpose, and so many carriers, both digital and human, of such information, writing the script for a better life is a continuous activity. It isn’t something to be indulged in once in an idle while. It isn’t an individual, private activity either. It is very much part of the family and community discourse.

 

Not only is the middle class amorphous in terms of its constituents, but it is also elastic in terms of its boundaries, because where the threshold of being an active consumer starts to qualify for the middle class tag, is in the eyes of the beholder. It could include all those who shop at the big malls with brand name stores, and go to the many new night clubs or wine bars for entertainment, and those who are on cheap tickets to Bangkok, complete with elderly parents and babies, for a short break, and all of the second class travellers in any Shatabdi and extend all the way to those for whom haute couture is Chinese accessories available on well displayed roadside shops in most local markets, and pizza is a gourmet meal.

Even an attempt to anchor the middle class with clear income definitions doesn’t help. Well publicised research and consulting reports that claim to be able to define the middle class by income boundaries either end up with boundaries so broad that they may as well not be there, or with income definitions so high and resultant middle class population numbers that are so small, that they fly in the face of our everyday experience. This is partly because income measurements and calibration for a non-salaried self-employed class is not something that is fully understood yet; and because there are so many shades and grades and patterns of income that new income classifications need to be created.

However, at the end of the day, since the middle class is defined by its consumption alone, and since the thresholds of consumption are in the eyes of the beholder, perhaps it makes sense to rename the middle class as the consuming class and understand the broad themes that exist, not necessarily common to all, in the role, meaning and method of consumption of this consuming class, this mini India, that now has the income to buy what it wants and the unfettered supply of a variety of things to buy.

 

Does the consuming class define itself in terms of its consumption? Is its identity based on the fact that it consumes?

Some sociologists argue that the whole point of the new Indian middle class is that it is defined by its consumption and draws its identity from the fact that it has a certain kind of middle class lifestyle defined by media images. This, in effect, suggests that the middle class is a well defined culture class and not a bucket of people who happen to be very consumption friendly.

However, in reality the middle class does not think of itself as belonging to the middle class, nor see itself as belonging to a consumption or consumer club. Consumption does give it identity in terms of its not being poor, but this is no different or more intense than the age old concept of khaatey peetey log, or the gaadi hai, bangla hai qualification of a well off man. Ironically, it is the upper class that still likes to define its identity in terms of consumption, and that too in terms of limited or Spartan consumption. They define their values and outlook as being ‘middle class’. As an article in a netzine said, tongue in cheek, that the very rich in India are seriously very boring. Barring two or, at the most, three exceptions, the biggest of Indian business owners vie with each other on being more Spartan, more spiritual, more vegetarian, more hard working, and more family oriented of all.

 

Further, there is no uniform or unifying middle class lifestyle, or a few lifestyle templates that the so called middle class universally recognize and strive for. The yuppy working couple in Gurgaon whose lifestyle and consumption patterns resembles their counterparts anywhere in the world, and the bank clerk born and brought up in Tirunelvelli are both bona fide members of the middle class because of their ability to consume above a certain threshold, but their consumption basket and behaviour has very little in common. As for media imagery, it does appear both in terms of TV serials as well as advertising that they are reflecting what is already happening outside rather than leading it.

In fact, what is really missing in the market today is the shaping of consumption behaviour by marketers and retailers. Despite huge changes in the physical, social and work environment of India, which in turn has an impact on how the average Indian lives both at home and outside, both individually and as a family, there are no new rituals being constructed, no new ways of doing things being taught to him or her in a systematic ‘lead the consumer by the nose’ manner. What we have instead is an explosion of products and services, arranged like a mass menu with price tags, and the consuming class left to its own resources to figure out what they should order.

 

There are many value spaces that consumption occupies in the minds of the consuming class. One is that it is a reward for all the hard work that goes with the territory of working in a hyper growth economy with terrible infrastructure and awful weather. Striving and aspiring to get to the next level is pretty much a common feature across all Indians, whether rich or poor. There is a compulsion to be sharp and permanently on the watch to capture every available opportunity that comes ones way. This compulsion may not be intrinsic to ones nature, but society and family expect you to go after it.

The discourse of contentment has changed and is now seen to be for losers. The discourse of ‘too bad, if by fate, you aren’t born into money or don’t have readymade opportunities’ has changed to ‘if you have the talent, the grit, the coaching, the sleepless nights, the willingness to work very hard, the family support, and access to credit’, there are enough opportunities available that you can grasp.

A look at the popular role models of young people supports this view. Striving and slogging isn’t also just about doing better than you currently are. It is necessary to even stay where you are. The old middle class had enormous amounts of job security. Today’s middle class is mostly self-employed, and has no job security, and is buffeted by all possible environment winds. It thus has to work very hard and be very vigilant and diligent to even stay where it is, safely. For example, the owner of a truck and the owner of a dhaba on a trucking route could both be impacted by a range of events from the global recession weakening export oriented businesses to a realignment of manufacturing locations thanks to GST leading to a rise in fuel or onion prices.

A large part of the consuming class is micro and small entrepreneurs. A recent study shows that a liquidity crunch in the market makes big businesses delay payments first and foremost to these suppliers. A drop in the stock market makes the real estate broker’s customers postpone their activity and he in turn will postpone renovations to his home, thus impacting the home repair contractor, also a part of the consuming class. Therefore, for all this excruciatingly hard work, given the awful infrastructure, the reward is to buy yourself things that give you and your family pleasure. Otherwise what is the point of it all?

 

Even a salaried middle class sales executive who travels by train and plane doesn’t have an easy life – our infrastructure doesn’t work that way. To top it all, his company is on a relentless productivity improvement drive, aimed at continuous margin and profit growth to satisfy the stock market. So life is about head count freezes, sending data in real time from a PDA even while struggling with poor signals that make you struggle to get the job done. His reward too for all the hard work is the ability to buy himself and his family things that make for more pleasant and more interesting living, to make it all worthwhile. In some cases this could be a new two-wheeler, in others, a new car; yet others may opt for a larger house or for some it could be a large flat screen TV, a visit to an expensive multiplex, frequent eating out, new clothes, whatever. As the consuming class gets more time poor and money rich, we will see even more ‘I deserve it’ type of reward consumption.

 

Then we have the workmate consumption. It is needed because it either saves money or time or effort or helps earn more money. Enough has been said about cellphones and their role in saving time, effort and money. They also widen the footprint of operation, makes sure that you never miss a customer call because it shows up as a missed call, enable you to reach out to customers but not be intrusive again because you can leave them a missed call or send them an SMS, and so on.

The two-wheeler or car also has the same logic. If your job requires a lot of in-city travel, with the city transport infrastructure there is no way you can even accomplish a small fraction of what you could if you had your own transport. A personal home fitness trainer has to plan his route, based not on geography but on timings desired by his clients. With a cellphone and SMS, he can continuously adjust his schedules based on the ever-changing schedules of his clients, thus ensuring that no session is missed. The real estate broker offers the add-on service to his customers of ‘pick up and drop’ to ensure that they get to the viewing place on time, when keys are available. He needs a car for this, even if is a second-hand one, now easily available and with guarantees of quality. Hiring an SUV to take the entire family on an outing is the cheapest and only practical way of accomplishing this.

There is also utilitarian consumption that improves the basic quality of living and is essential because the quality of public goods is so shoddy. Inverters are a must because the power supply is patchy and one can no longer manage without enough electricity – for the mixer in the kitchen, the lights for the kids to study, for the air conditioner or fans in high summer. The mindset has changed from ‘it is the way it is’ to ‘there are solutions that are now available if you pay money.’ A television set is the cheapest form of entertainment for a family, because of lack of public spaces like playgrounds and parks and zoos and beaches with proper facilities for people of all ages to hang out in and do things cheaply.

 

As both incomes and cost of house-hold help rise, as they are doing now, driven by women who can earn more outside the house wanting to pay more for reliable household help, and also as the opportunity cost of time increases (opportunity cost could be monetary as in going out and earning money or a non-monetary one as in helping your child get more competitive to grab opportunities), the consumption of household gadgets increases. The more gadgets get innovated at various price performance points, the greater the consumption. A semi-automatic washing machine at a price point well below the automatic one, and which can cope with no running water supply, boosts utilitarian consumption. However, no matter how low cost the air conditioner, if it doesn’t deliver on low electricity consumption, it does not get bought. So we have a lot of cars with air conditioners owned by people who don’t have air conditioning at home.

The biggest categories of utilitarian consumption, necessitated by the failure of public goods, are education and healthcare. A lot has been said about the importance attached by all classes of Indians to education, and the consuming class is also an avid consumer of children’s education. Witness how many children go to Australia for vocational training related education, and how many middle class parents pay for all forms of coaching classes, be it for the SAT/GRE/GMAT exam to go to America or to the CAT and CET type exams to get into the limited seats for a halfway decent college or just for school fees and extra tuition and admission donation fees.

Even those segments of the consuming class who do not value formal education, as in getting a string of degrees, feel that kuch course karne se the child can earn more. So the home plumbing-painting-electricity-woodwork doing contractor’s son who has dropped out after school to help in dad’s business, is sent off to do a computer graphics course so that the package offered to customers – and the price – can be drastically improved. With it will come all the discretionary but essential purchases of a computer for the house, a laptop for customer sites, email, then a Blackberry and so the consumption cycle goes on.

Children’s education aids like computers also fall into the value space of utilitarian consumption. It isn’t about making a social statement that gets even lower middle income parents to buy computers for their kids. It just is the investment needed to get him into a higher orbit of earning and hence living well.

 

Given the self-employed nature of many of the constituents of the consuming class, healthcare is an important item of utilitarian consumption. As members of the consuming class will affirm, if you aren’t well, then you can’t work well, and you can’t earn. As the supply of private hospitals and surgeons increases rapidly, the middle class opts to spend more on breakdown maintenance of the body – so that it can be ready to strive more and aspire more and earn more. Of course, another reason for healthcare spends, especially for the elderly, as in the case of knee and hip replacements, is that if they aren’t up and about and able to take care of themselves, as well as help around the house when needed, then the opportunity cost for the earning members and the child prepping members is too much.

 

Using consumption as a means of signalling success, belonging to a new peer group as a result of upward social mobility, signalling social distance to those left behind is an important part of the consumer class’s consumption agenda. Its importance in the total consumption basket varies considerably within the group, especially for new entrants into the consuming class.

Take an immigrant from UP or Bihar to Bombay. What all he consumes or possesses is seen as a powerful signal of social mobility and success, both of which are the cherished goals of any Indian today. He typically works eighteen hours a day, lives in awful housing, does jobs that are far below his social status had he stayed on in the village, and goes back once a year bearing gifts for those left behind, displaying possessions that he couldn’t have had if he had not left. It’s a bit like the earlier generation of Indian immigrants to the UK. Belonging to the consuming class meant that you could buy things that your parents didn’t have and start life several notches higher in terms of your standard of living.

Salim, a 35 year old Muslim who is a personal fitness trainer to upper class folks in a large metro, works crazy hours and commutes several hundred kilometres in the course of a day’s work. His consumption basket is dominated by the need to signal upward mobility to the family and friends from the background he comes from, even though he continues to draw his identity from it. This means trading in a chawl for a small apartment in a nice neighbourhood, with a playground for his kid; while part of his immediate family still lives jointly with him, he signals upward mobility through having ‘privacy’ in the form of his own bedroom.

As with all other child obsessed Indians, he also gets to buy toys and clothes for his daughter, that signals belonging to a new social class that he has become a part of. He expresses a modern identity and signals social equality with those he trains through the recognizable brand name jeans and sweatshirt ensemble that he wears.

 

An average IIM grad also uses consumption as a signal of success. Perhaps social mobility is not as important to him, since he has already ‘arrived’ or at least is firmly on the road to arrival. But signalling success is an important part of the consumption agenda of most upper middle class Indians. The signals change constantly depending on what the peer group is doing – so it could be second homes, trips to Disneyland with the kids, home theatres, cars, spas, exotic holidays and so on. This is the value space that gets covered the most in media – whether it is the hopeless struggle for belonging of the wannabe leading him into debt that he can’t pay off, or the ceaseless expenditure of the ‘arrived’, also funded in part by debt, ever in search of props to signal ‘that I am doing better than you.’

The interesting thing though is that consumption as a means of self-expression isn’t a very major part of the consumption language of the middle consuming class in India – with the possible exception of ringtones, and choice of colours. That explains why brands have such a hard time commanding a premium based on non-functional attributes. The rich use brands to signal membership to an exclusive social set, but to the not so rich middle class consumers, it is the range and features of the things that are owned that count. Interestingly, in the pre-liberalization era, the brand personality and user imagery carried far more weight in consumption decisions than it does today. But today, as a rural consumer pointed out, the logic is, ‘Why should I buy a shampoo that is supposed to give me status when I can buy a refrigerator that everyone can see, and use soap to wash my hair – who is to know?’

The language of middle class consumption is still largely about functionality and pragmatism and utilitarianism, liberally laced with rewards and treats for a tough life and little family time, and social signalling. It will continue to be this way as we generate the next trillion dollars of GDP with an even more spectacular failure of public goods. Being a citizen gets you nothing, but being a consumer buying from private suppliers, be it even the use of super highways or electricity or garbage collection, makes life easier.

 

What consumption isn’t, though, is purely hedonistic or at the core of the identity of India’s consuming class. And when we berate the new middle class for not participating in social and national issues, let us remember that this is a consuming class defined by its consumption behaviour and not the middle class as it is traditionally understood. We still have to understand where India’s true middle class society lies. We know where India’s middle class economy lies, though.

 

* Rama Bijapurkar is the author of We Are Like That Only: Understanding the Logic of Consumer India (Penguin India).