The emerging middle class is growing. Fast. We touched upon this trend in our very first infographic, and our very first blog post. This is a trend that is, for the most part, driving almost every other emerging market trend we have mentioned. The global middle class currently sits at right around 2 billion, although this number varies depending on what measurement you use. By 2020, this number is expected to rise to over 3.2 billion, and by 2030, could reach nearly 5 billion. The vast majority of this growth, nearly 85%, will come from Asia. China and India alone will account for one billion middle class consumers by 2020.
As these billions upon billions of emerging market consumers enter the middle class, their income passes a certain point, at which demand for consumer goods surges. Several global brands have taken note of this eminent trend, and have sought to position themselves at the forefront of consumers’ minds. At Jana, we have worked with brands like Danone, Ponds, Unilever, and others to help familiarize the emerging middle class with their products, establishing brand loyalty early.
Many other brands have sought to expand their emerging market presence now, in hopes of even greater benefit in the future. Various fast food companies have prioritized developing Asia for new restaurant locations. Yum! Brands, owner of KFC and Pizza Hut, has already opened outlets in 720 different Chinese cities. Other consumer brands like PepsiCo and Kraft have completely redesigned their offerings to appeal to local tastes. For example, in China, consumers can finish off chicken flavored chips with a sleeve of green tea Oreos. The trend is not limited to inexpensive food brands, luxury brands like Hermes and Louis Vuitton have worked to position themselves for the eventual upper class growth as well. Regardless of the brand or the product being sold, the emerging middle class is poised to consume, and global companies would be wise to take notice.
Which brands do you see emerging victorious in the battle for the emerging middle class? Let us know on Twitter: @Jana
Published January 11, 2013