SOCIO-ECONOMIC CLASSIFICATION

Introduction

Earlier, market researchers in India used income as the basis of classifying households. It was a system that never satisfied the needs of either the research practitioner or the user. The Market Research Society of India (MRSI), therefore adopted as its first task: to search for an alternative to income.

Why did we wish to move away from income?

o The widespread underreporting of income makes the category difficult to interpret
o Non-response on income, especially in the larger cities
o The income question is 'unsuitable at the doorstep' as an opening question
o Finally, income based data has a high rate of obsolescence, which the industry just cannot afford

What is the SEC Study all about?

In the SEC Study, we have gone to 5781 households at eight locations - metros and Class II towns - and obtained information on a number of indicators - occupation, education, ownership and use of a number of products

This database has been used to construct and compare alternatives to income. The alternatives tested include systems based on:

o Income
o Household Expenditure
o Occupation
o Education
o Ownership

What was the winning system?

The winning system uses information on occupation and education of the Chief Wage Earner to classify households on an eight-point scale.

Harmonization of Demographics

The benefits of harmonizing demographic data are apparent. Having uniform classification data in market surveys helps in:

o Comparing findings of market studies carried out by different research agencies
o Comparing studies carried out at different points of time
o Building up a database through large scale national projects to enable weighting and projection of survey data

This guide is the outcome of a collective deliberation of MRSI members, both research agencies and users. Research agencies, which are members of the MRSI, have agreed to collect standard classification data as presented in this guide. The inclusion of classification items in this guide does not mean that they should appear on all questionnaires; nor does it mean that these items should be the only ones that should be included. However, it does imply that when any of these items are included in the questionnaire, they should be treated in this standard manner. The researcher has an option, however, of using a more concise list of items by clubbing into wider groups. For a fuller description and definition of the categories, write to the MRSI for a copy of "Harmonization of Demographics: A Manual for Research Agencies and Users". Do also write to us if you have any questions.

Classification Data: A Checklist

The Socio Economic Classification (SEC) given below is based on the education and occupation of the Chief Wage Earner in India. This is a widely followed classification system.