How quickly should a category or brand grow to avoid standing still? It depends on how fast the relevant part of the population is growing. We updated (May 2015) our popular analysis and it now covers 2015-2025. India, Bangladesh, Viet Nam, Pakistan, Indonesia are the top 5 countries. Only the higher (non-poor) socioeconomic classes can afford branded consumer goods. Thus, one can easily see—using C-GIDD data—how quickly a category should grow based only on socio-demographic changes.
In the graphs below, we quantified the growth of the “branded consumer goods class” of working age people between 2015 and 2025 for the 40 largest economies in the world. If a category grows at this rate, it is steady and holds its own. If it grows slower, the category is in relative decline. If it grows faster it is gaining share relative to other categories. The hurdle is what we call intrinsic growth.
The numbers may come as a surprise: “I’m growing my category at 10% a year in Bangladesh, and you’re telling me I’m in decline!” “Yes, you are slowly declining in per capita consumption among relevant consumers”.
Of course, many other factors help determine category or competitive success in FMCG and retail. But this is one useful metric that helps explain if, e.g., achieving 6% annual growth in the Philippines is easier than 2% growth in Australia (it is). It also points to the massive opportunities in premium categories.
The mainstream intrinsic growth rate is based on the growth of lower middle class and above (D+, C, C+, AB). The premium intrinsic growth rate is based on upper middle class and above (C+, AB).