<p>A young professional in Delhi, books himself on a holiday to Bali every year without much deliberation. He pays for Spotify, Netflix and a premium gym membership without a second thought and your columnist has seen him spend on a meal at a restaurant in Mehrauli that would make a CFO wince. Ask him where he buys his clothes and he will tell you, with some pride, that there is very little Sarojini Nagar cannot provide. Then there is a small business owner from Indore, a man who runs a modest trading operation and has built it carefully over a decade. He has strong views on food (where it comes from, how it is prepared, what it ought to cost) and spends accordingly. His drink of choice, at the end of any working day, is Old Monk. Whether that reflects preference or habit, he has never felt the need to examine the question.</p><p>These two men would be classified identically by most standard segmentation exercises: urban-adjacent, male, mid-income, aspirational. A marketing brief written around either of them would, in all likelihood, describe both. That is precisely the problem. India's consumer market has been fragmenting consistently for years, not along the lines that segmentation models track, but along something harder to classify. Consequently , it is harder for firms to determine which categories deserve serious money and which do not. The Delhi professional has decided that experience and convenience are worth paying for; fabric is not. The Indore businessman has decided that what goes into his body warrants care; what goes into his glass is a different matter entirely. Neither is being irrational.</p><p>The tools the industry has used to make sense of Indian consumers have always struggled to keep pace with this complexity. The original Socio-Economic Classification, introduced in 1988, sorted households by the occupation and education of the chief wage earner. It was replaced by New Consumer Classification System (NCCS), which used consumer durables as its proxy. NCCS was itself retired earlier this year, when the Market Research Society of India launched Indian Socio-Economic Classification (ISEC), a twelve-tier system intended to be more stable and more discriminating than its predecessor. Each iteration has been a reasonable attempt to fix what the previous one got wrong. What none of them has addressed is the more fundamental difficulty, the fact that India is too plural, too fast-moving and too internally contradictory for any standardised classification to hold for long. A country where a household in Indore can be simultaneously premium on groceries and indifferent to alcohol, where a Delhi professional allocates serious money to experiences and none to apparel, does not sort neatly into tiers.</p><p>The reason these frameworks have persisted is that the broader industry infrastructure runs on them. Media gets bought in standardised cohorts, agencies are briefed in demographic cuts and campaign performance is evaluated against tier-based targets. The classification has become an organisational grammar, and grammars are difficult to revise even when everyone privately suspects they are inadequate. The result is that briefs get written for a consumer who, in the form described, does not quite exist and messages are crafted for an average Joe that the market has long since abandoned.</p><p>What the data that companies already hold would reveal, if interrogated differently, is that the more useful unit of analysis is not a demographic cohort but a behavioural cluster formed by a group of people who have arrived, by different routes, at the same conclusion about what a category is worth. The signals are available through purchase patterns, basket composition, frequency of transaction, the categories where a consumer trades up and the ones where they consciously do not. A CMO who maps those signals will find a target group that is smaller than the one the old frameworks suggested, and considerably sharper. The message that speaks to someone who has already decided your category matters will always outperform the one designed for a tier. India's consumers have known for some time what they value and what they do not. The segmentation systems the industry relies upon are still trying to catch up.</p>
<p>A young professional in Delhi, books himself on a holiday to Bali every year without much deliberation. He pays for Spotify, Netflix and a premium gym membership without a second thought and your columnist has seen him spend on a meal at a restaurant in Mehrauli that would make a CFO wince. Ask him where he buys his clothes and he will tell you, with some pride, that there is very little Sarojini Nagar cannot provide. Then there is a small business owner from Indore, a man who runs a modest trading operation and has built it carefully over a decade. He has strong views on food (where it comes from, how it is prepared, what it ought to cost) and spends accordingly. His drink of choice, at the end of any working day, is Old Monk. Whether that reflects preference or habit, he has never felt the need to examine the question.</p><p>These two men would be classified identically by most standard segmentation exercises: urban-adjacent, male, mid-income, aspirational. A marketing brief written around either of them would, in all likelihood, describe both. That is precisely the problem. India's consumer market has been fragmenting consistently for years, not along the lines that segmentation models track, but along something harder to classify. Consequently , it is harder for firms to determine which categories deserve serious money and which do not. The Delhi professional has decided that experience and convenience are worth paying for; fabric is not. The Indore businessman has decided that what goes into his body warrants care; what goes into his glass is a different matter entirely. Neither is being irrational.</p><p>The tools the industry has used to make sense of Indian consumers have always struggled to keep pace with this complexity. The original Socio-Economic Classification, introduced in 1988, sorted households by the occupation and education of the chief wage earner. It was replaced by New Consumer Classification System (NCCS), which used consumer durables as its proxy. NCCS was itself retired earlier this year, when the Market Research Society of India launched Indian Socio-Economic Classification (ISEC), a twelve-tier system intended to be more stable and more discriminating than its predecessor. Each iteration has been a reasonable attempt to fix what the previous one got wrong. What none of them has addressed is the more fundamental difficulty, the fact that India is too plural, too fast-moving and too internally contradictory for any standardised classification to hold for long. A country where a household in Indore can be simultaneously premium on groceries and indifferent to alcohol, where a Delhi professional allocates serious money to experiences and none to apparel, does not sort neatly into tiers.</p><p>The reason these frameworks have persisted is that the broader industry infrastructure runs on them. Media gets bought in standardised cohorts, agencies are briefed in demographic cuts and campaign performance is evaluated against tier-based targets. The classification has become an organisational grammar, and grammars are difficult to revise even when everyone privately suspects they are inadequate. The result is that briefs get written for a consumer who, in the form described, does not quite exist and messages are crafted for an average Joe that the market has long since abandoned.</p><p>What the data that companies already hold would reveal, if interrogated differently, is that the more useful unit of analysis is not a demographic cohort but a behavioural cluster formed by a group of people who have arrived, by different routes, at the same conclusion about what a category is worth. The signals are available through purchase patterns, basket composition, frequency of transaction, the categories where a consumer trades up and the ones where they consciously do not. A CMO who maps those signals will find a target group that is smaller than the one the old frameworks suggested, and considerably sharper. The message that speaks to someone who has already decided your category matters will always outperform the one designed for a tier. India's consumers have known for some time what they value and what they do not. The segmentation systems the industry relies upon are still trying to catch up.</p>
