India, like the rest of the world, is facing unprecedented times as the battle against COVID-19 continues and people look to emergence and recovery. The Dainik Bhaskar Group has seen that India’s non-metro areas, the villages and smaller cities that make up the Bharat hinterland, have been much more resilient and are leading that growth.
In an INMA South Asia Webinar on Thursday, Dainik Bhaskar Director and Promoter Girish Agarwal discussed with members why Bharat is leading the recovery ahead of the metropolitan areas of India.
The first signs of recovery from COVID-19 lockdown came from a handful of reputable industry reports, such as Deloitte, Ernst & Young, and BCG, Agarwal said.
“In India, the revival is happening,” he told INMA members.
Metro vs. non-metro recovery
Referencing the Ernst & Young report, Agarwal said non-metropolitan markets have shown higher resilience than metro markets, and the percentage of study respondents who expected to spend more money was much higher in non-metros. In fact, 34% of non-metro respondents were going out shopping, compared to 25% in the metros.
Consumers in non-metropolitan markets are also spending more on fast-moving consumer durables, as the slide below demonstrates:
“All these aspects clearly says that the real growth in terms of sales is coming back from the non-metros,” Agarwal said.
In transport and travel categories, spends are also higher:
- Cars: 25% of non-metros vs. 14% of metros.
- Scooters/bikes: 24% of non-metros vs. 15% of metros.
- Public transport: 19% of non-metros vs. 2% of metros.
- Business travel: 22% of non-metros vs. 2% of metros.
“Not many people in Indian metros are travelling between metros,” Agarwal added. In the smaller cities and towns, however, people are travelling between them in cars or using public transport.
Similarly, non-metro consumers are also expected to lead in the consumption of other lifestyle categories:
- Apparel: 18% of non-metros vs. 7% of metros.
- Cosmetics: 17% of non-metros vs. 7% of metros.
- Beauty parlours/spas: 21% of non-metros vs. 9% of metros.
- Shopping malls: 20% of non-metros vs. 2% of metros.
- Restaurants: 22% of non-metros vs. 4% of metros.
- Vacations: 20% of non-metros vs. 2% of metros.
“It clearly indicates that the resilience [of the non-metros] is much helping the country,” Agarwal said.
One country, but uniquely different
The metro areas of India and the non-metro Bharat areas are completely different.
“Different from perspective, different from the way we live,” Agarwal said.
People in the metropolitan areas generally live in large high-rise buildings, are still working from home, are more isolated and self-distanced, and are dependent on public transport for mobility. They are faced with a scarcity of time and information overload.
People in smaller non-metros, on the other hand, live in smaller buildings or individual houses, have personal mobility, and look to their family and friends for happiness. As far as work and going out, Bharat re-opened within 21 days of the nationwide lockdown, and residents are able to go out and visit with one another.
“Your life is not restricted at all,” Agarwal said of non-metro citizens. He added that non-metro residents are largely self-employed, so the loss of jobs and cutbacks that affected people in the metros did not affect them as much.
“So you see, we are one country, but the lifestyle pattern of non-metro has worked in their favour. That is why they are still happily consuming, while those in metros are still sitting at home.”
Changes in the market
“This pandemic changed the whole market prioritisation,” Agarwal said. “It took this pandemic for people to realise that currently, almost 60-70% of India’s consumption is happening in Bharat.”
COVID-19 upended the traditional market prioritisation in India:
- The two/three/four tier cities of Bharat opened up from lockdown faster, and emerged as centres of demand and consumption.
- India’s metros, the traditional first-priority markets, remained clamped down long into the pandemic.
- Fifty-three million people went back to their native towns and villages from the metropolitan areas, causing a massive displacement of demand and consumption.
“I think the whole traditional approach of the market prioritisation that was happening earlier, this pandemic has changed that — totally,” Agarwal said.
Bharat drives demand in various categories
When it comes to celebrating India’s festivals, the non-metro markets have driven that demand for the entire country. In response to this, there were mega-issues of newspapers during the pre-festive season to herald the restoration of print circulation and boost advertiser confidence. Dainik Bhaskar (DB) produced seven mega-issues ranging from 66-144 pages.
Auto, retail, e-commerce, durables, jewelry, and real estate have all showed a strong resurgence in the Hindi and Indian language markets. Dainik Bhaskar has registered close to normal levels of growth as compared to last year in all of these categories except for real estate, which has grown by double digits. Among the top seven advertising brands five were auto brands, reflecting auto makers’ massive growth.
“Bharat started consuming, and Bharat held them in terms of demand and consumption,” Agarwal said.
Strong signs of recovery
The All-India GST (Goods and Services Tax) Collection for September 2020 stood at 95,480 crore, accounting for a 3.9% growth year-over-year.
In the Dainik Bhaskar footprint, Bharat markets registered phenomenal growth compared to other markets and India’s overall growth.
Agarwal shared a slide that showed a breakdown of that GST growth by state, comparing September 2020 to September 2019.
He said that the metro areas were actually declining, while Bharat was growing: “This indicates that in the economic scenario, the Indian economy is supported by Bharat.”