World Economic Journal Issue 43 September 2024 | Page 69

WORLD ECONOMIC JOURNAL

Saad Hasan is Principal at Sturgeon Capital . He has a decade of experience in both emerging and developed markets . From 2017 to 2019 , he co-founded and scaled Jrop , a North- American Mappingas-a-Service company . His career includes roles at HBL , Pakistan ’ s largest bank , Morgan Stanley , Qatar Airways and JLL . people fall in the country , with the likes of Daraz and Bykea targeting households in the upper quartile of this range . This market is expected to experience the greatest level of upward mobility over the next 10 years , with average income per capita rising at least 25 % and up to 40 %. This is the long-tail of the Pakistani consumer market .

• GROUP 3 – A small fraction ( 3.8 %) of households generate an income between Rs . 200,000 to Rs . 600,000 per month . These households range from price-sensitive to very price-sensitive and partially time-sensitive to very time-sensitive . This can also be called the upper middle class of Pakistan , which has part-time drivers and maids , but focuses their spending on education , investments and travel . They are also discount-driven and careful with their spending , yet typically have at least two working members in the household , which necessitates a high level of convenience . This group often shops at more upscale grocery stores and prefers branded products . They tend to be more private but also aspirational , frequently timing their online purchases to coincide with sales , though they rarely participate in group buying . This is the core market for Bykea , Daraz , FoodPanda and formerly Airlift . A medium-term opportunity with this group lies in engaging the Gen Z segment , which is more social and drawn to gamification and non-monetary incentives .

• GROUP 4 – Accounting for just 1 %, wealthy households generate an income between Rs . 600,000 to Rs . 1,200,000 per month . These households range from partially price-sensitive to price-sensitive and time-sensitive to very time-sensitive .

A summary of consumption by household segments in Pakistan

Sources : Pakistan Bureau of Statistics ( Household Size , 2023 ; Household Integrated Economic Survey , 2018-19 ), Reall ( Understanding Household Incomes , Dec . 2022 ), with some adjustments for inflation , depreciation and changes in wages .

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