With more than five billion people living in cities by 2030, urban consumers will make up most of the global consumption and are drivers of major consumer trends. Identifying the target urban consumer segment as well as knowing and adapting to their evolving demographics, incomes and spending preferences are, therefore, becoming vital for businesses.
Based on size and income expansion through to 2030, the following four urban consumer groups are identified as having growing importance for business:
Newly-Urban consumers in developing countries
Developing and emerging markets will see an increase of 892 million urban population between 2019 and 2030, bringing their total number of urban consumers to 4.2 billion by the end of the period. This will be driven not only by births in existing cities but also by the creation of new cities and ongoing rural-urban migration. Having improved access to infrastructure and rising incomes, newly-urban consumers in developing countries offer great opportunities for new penetration of household appliances, communications, and transport vehicles.
Source: Euromonitor International from national statistics/UN
Note: Data for 2030 are forecasts
The elderly urban consumers in developed markets
By 2030, 261 million consumers in developed countries will be aged over 65, and most of them live in urban areas. With relatively high-income levels and positive attitudes towards ageing, these urban consumers tend to enjoy their lives and are keen on health and wellness products and services, as well as entertainment and travelling.
Working-Age consumers in emerging market cities
Backed by solid economic growth, urban consumers aged 15-64-years in emerging markets will see significant rises in their income and spending power. For example, per capita, disposable income in Beijing (China) and Delhi (India) is expected to increase by 78.2% and 93.1% in real terms between 2018-2030, respectively.
With their evolving lifestyles, this increasingly affluent group will be more willing to spend on high-quality products and services, as well as those that help them to save time and enjoy their lives.
The urban solo-dwellers
Single-person homes will account for almost one-fifth of the global households to reach 478 million by 2030, with most of them living in cities. Though solo city dwellers are relatively budget-conscious (given the disproportionate share of earnings they must allocate to housing), they often seek experiences to celebrate their independent lifestyles, while urban living conditions also allow them to do so.
Overall, migration, population ageing and changing lifestyles are driving rapid changes in the profile of the global urban consumer worldwide. Cities across the globe are witnessing a rise in population diversity, a growing number of elderly consumers and smaller households, and a gradual shift of consumption patterns towards more services. Companies that can navigate through the increasingly diverse and complex consumer landscape will be likely to garner greater success in the future.