Santiago the Segmented

I’m noticing this odd phenomenon about social classes here in Chile. There is a weird obsession over them that reaches every corner of this country. Further, there seems to be a constant need to identify which class people fall into.

…or maybe it’s because I’m studying Marketing and for all types of reasons, marketers need to segment the population at large…Ok, I won’t discard that this might be the reason why figuring out where people are “located” in the social class hierarchy seems to be a national past time for those who immediately surround me.

There are several factors that determine what socioeconomic class people fall under here in Chile and one of those factors in Santiago is the “comuna” or neighborhood you live in. Note the map below for a quick glimpse of the comunas that make up Santiago:

I first became aware of this chasm between classes when I visited some cousins in Chile for a three-month period back in 1998. My cousins, aunt and uncle live in a three bedroom house in Puente Alto. I didn’t personally see anything “different” about them or how they lived since they had all the things I had at home … in fact, I’d argue that they lived far better than we did back then because they certainly always had a good amount of food readily available for a quick asado (bbq). They had cars, tvs, phones, mircowaves, fridges, etc, etc. It wasn’t until THEY said to me “Vamos a ir al barrio alto” that I even had a notion that a “higher neighborhood” (as in upper class neighborhood) even existed in such a manner that it had it’s own nickname. See, to them, going past the Ñuñoa neighborhood is like venturing into a completely different country. Anything from the Providencia neighborhood and on, is mostly foreign to them. In fact, a couple of weeks after the earthquake, another cousin of mine who happens to live beyond Providencia, mentioned that she had gone to the mall, Parque Arauco, for a one-time job and she was FLOORED that people were shopping and eating out. She literally said “It’s like another world up there.” Up there being the Las Condes neighborhood.

Aside from neighborhoods, another factor in determining what class you fall into are what the Census calls “Good” (or “Bienes.”) Does the family or household have a tv, a land line, a refrigerator, a car, a microwave, a shower (yes, you read that correctly. They want to know if you have a shower)? There are about 10-15 items that are considered to be basic and depending on whether a family has them or not, helps determine where in the social class spectrum they will ultimately fall. The higher class will obviously have 100% of all items, in multiple quantities, whereas a lower class household may have certain things, but definitely not 100% of them.

Finally, another important factor that helps determine where a household falls is the level of education reached by the head (or heads) of household. Those in the upper sections of the spectrum will have totaled an average of AT LEAST 16.2 years of schooling and most have certainly graduated college and further, hold a Graduate degree from a known institution.

So then, how are classes “classified?” Not in the typical fashion we hear about in the U.S. – Upper Class, Upper Middle Class, Middle Class, Lower Middle Class, Upper Lower Class, etc, etc until you get to the standard Lower Class title. In Chile, each class has a letter or series of letters assigned to them as follows:

ABC1: These are college graduates who hold executive level jobs or otherwise “prestigious” jobs. Likewise, these individuals hold powerful positions within their companies and they live in the best and most exclusive neighborhoods of Santiago. Their monthly income is calculated at about $3.5 million pesos (about USD$7000) a month or more. These individuals make up about 10% of Santiago’s population. They own two or more cars, all or most luxury makes and models, and the cars are less than 5 years old. Usually the “AB” segement is grouped together with the C1 segment because the AB alone would only make up about 2.5% of the population (incidentally, this segment alone would be quite difficult to analyze since they are the ones who will have most of their “goods” completely guarded and all info on them would be heavily shrouded.)

C2: This is considered to be the “most typical” middle class of the city and make up less than 20% of the population of Santiago. They tend to live in more traditional neighborhoods of the city, sometimes further away from the downtown areas and with clean, well maintained homes,streets and sidewalks. The heads of households are generally also college graduates with executive-type jobs or are heads of departments in their companies. Their income is an average $1 million pesos a month (about US#2,000) and they own at least one car (sometimes two). Unfortunately in this group, savings is not a reality for the most part.

C3: Middle class noted mainly for its simplicity. This group tends to live amongst the C1 group and the D group, typically found in the more traditional, sometimes older neighborhoods of Santiago. Socially speaking an interesting point about this group is that in their neighborhoods, one can note an elevated level of domestic activity on the streets (i.e. housewives sweeping, children playing, etc). This group is said to make up 25% of the population of Santiago. The average household income is $600 thousand pesos (about US$1,200) and they tend to not have cars but might instead own very old, handed down trucks. Only 10% of this group has a land line in their homes.

D: This is the lower class group that makes up approximately a reported 35% of the population of Santiago. They have an average monthly income of $300 thousand pesos (about US$600) and they tend to live in smaller, older, mainly deteriorated homes. It’s reported that these households rely on only one revenue earning member. That being said, because there are so many individuals who fall in this category, they are notable for business purposes as they are a force as consumers due to amount of people in this group. Those in this group tend to not have steady jobs but rather will work seasonal or non-contractual jobs (i.e. parking lot attendants). They live in very populated ares of the city, generally on streets that don’t necessarily contain pavement.

E: This group is considered to be at almost poverty, if not poverty, level and they make up 10% of the population in Santiago. Their average household income is $90 thousand pesos (about US$180) and this income is either very sporadic income or money granted to them by the government. This group cannot afford to cover the most basic of necessities and generally rely on third party assistance (i.e. the government in many cases). Due to their lack of purchasing power, unfortunately they are rarely regarded in consumer studies.

Why did I feel the need to write about this? First of all, on a selfish note, I really needed to understand how consumers are segmented in Chile. For obvious reasons, businesses and companies in general, focus on the ABC1 and C2 groups mostly because of their purchasing power. After all, these are the people who have the money to spend on goods and services. Logical of course.

I also wanted to understand, in depth, how one group differs from another because Chile really is a segmented culture. In fact, this study I explored done by AIM (Chilean Association of Market Studies) in 2008 contains 38 pages of information. Information that is so detailed, it even tells you how each group DECORATES THEIR HOMES!! Crazy.

I think that Chileans segment themselves and they do this because this is how it’s been all their lives. This is certainly not known as the “land of opportunity” and I wonder how many D class individuals ever make it to the sphere of ABC1 or even C2! Is that even possible here? I take a look at my own family members (ones I wouldn’t even dare classify!) and wonder why they never go out in other areas of the city, why they don’t have friends who live in other areas and why they only move around in their neighborhoods. The same goes for those who live in Las Condes and beyond – do they ever go to Puente Alto to have a beer or a quick bite to eat? My guess is no.

It’s interesting how my graduate studies have made me look at people and wonder how their socioeconomic class, as dictated by Chile and themselves personally, makes them tick and motivates them one way or another.

Is it possible to make leaps and bounds in such a segmented culture (and city)? Discuss.

Sources: AIM Chile, Novomerc Study, CERC.

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7 thoughts on “Santiago the Segmented

  1. Really interesting. The different groups in Chilean society tend to separate themselves and "self regenerate" with minimum interaction with other groups. I use the word group instead of social class because this happens on every level, not just in the economical classes.
    If you look some Chilean TV, you´ll see that the new host of a show, happens to be the daughter of another well known host, or that the "new" senator is the son of a former president, or even that two opposing political candidates went to the same school, and etc.
    Social networks here in Chile tend to form and interact inside those groups, and rarely get pass them, so all people live their lives feeling they know everyone near them (they went to the same schools, they went to the same parties, the same places in summer, and so on), even if they live in a city with millions of people.
    An ABC1 will never buy something in a department store that aims at C2 or C3, and the C2 or C3 people rarely will go to an ABC1 place.
    Finally this kind of behaviour is heavier in Santiago, other smaller cities also have this segmented culture, but people tend to blend more, at least in Temuco, we do 🙂

  2. Now I can comment! Maybe it was the layout? Anyway, this one's prettier 🙂

    Ok, now for my comment.

    I'm obsessed with things like this. It fascinates me. I wrote my thesis on inequality in the educational system here in Chile, so for hours I poured over the Novomerc study and similar data. It's super interesting, because based on salary alone I'd be in C3, but because I'm foreign and because where I live, I probably interact most with C2s or even C1s. Probably people who see me assume I'm ABC1 because of the way I look.

    I think one of the reasons this all fascinates me is because it's so foreign and different from the way I viewed the world growing up. Obviously in school you could more or less tell who had more money or less money, but we all interacted, we shopped in the same stores, we went to the same restaurants, etc.

    I don't really like the judgment here in Chile about where you live. I don't like it when I tell people I live in Providencia and for that simple fact they make 1000 assumptions about who I am. I think maybe I'll start saying I live in Cerro Navia or something.

    Oh, also (sorry for the super long comment) when I was doing my research I found a map of Santiago by ABC1, C2, etc. It was really interesting. I'll see if I can find it again.

  3. It's possible, albeit very tricky, to move up from C3 and below but there's definitely been a lot of movement from C2 to C1 and B in recent years. I certainly noticed it a lot with my ex-girlf's family and friends…lots of nouveau-riche around. And I have a friend who's moved up from C3 to probably B through sheer hard work and an obsession with 'bettering' himself. He's very impressive in how he's managed to study and work himself out of where he came from and also really quite pathetic with how he acts around 'natural' ABC1s- too much sucking up, too much trying to imitate them.

    Part of the problem with the social classes here are that they're often very much linked to the colour of your skin and the shape of your eyes…so even if someone makes a tonne of money, they'll never be accepted by the upper-middle and upper classes if they don't look like them. And this is why foreigners are automatically assumed to be wealthy ABC1s. It's a huge advantage for me the way I look and I'm happy to play on the ridiculous class system here and take advantage of it. I've met people on a social and business level in this country that I'd never have a hope of getting close to in the US and Europe.

    Coming from England, where the structured class system is still a part of society (although it's been hugely broken down over the past 50-60 years) I think I find understanding the concept of that aspect of the culture easier than most Americans.

  4. Marmo: yes, definitely quite a good point you have about where people shop … though again, perhaps it's just me, or maybe it's the same for all foreigners, but I really don't see the difference between Falabella, Ripley and Paris. To me, they target they same people: ABC1 and C2. La Polar and Johnsons, ok, I get that they are lower than the first three, but again, between the two, what's the difference?

    Abby: It's interesting because as I was top-line researching for this blog post, I too would pinpoint how G and I might be in one class bc of salary, but in another bc of our cars or even another bc of where we live! In that case, do we add all and divide by "n" to get an average class we can fall into comfortably? :o)

    Matt: Definitely much harder for Americans to adapt to the way classes are so divided here. It's subtle, yet not. And it's insane how almost like a mouse in a labyrinth, everyone sticks to their own route and doesn't deviate. Interesting to hear that in England it's (or has been) very similar to Chile. I actually never heard or even considered that!

  5. Very interesting topic, especially for those new to Chile. Having been born and raised in Chile I have spent most of my life in the U.S. and Canada.
    Here is my non-scientific, non-academic view of Chilean multiple classes.

    To me, there are only four groups. Group one consists of those born in “barrio alto”. They have attended the best schools, have higher incomes and broadly speaking are a fairly racist and prejudicial bunch. In order to belong to their group one must meet a long list of requirements such as; having a good family last name, be physically attractive, have a higher than average income, vacation abroad, have all the toys and whistles ever devised, be members of the right clubs, etc, etc.

    The next group going down the ladder is the middle class. They do not live in barrio alto and have attended public schools. They have an OK income, and are not as "good looking" as the previous group.

    The third societal group in Chile are the poor. They have no looks, no education, no job, and not much of anything according to many in Chilean society.

    Last but not least, are the farmers and all those who live in the country outside of Santiago. Generally a much nicer group of people to be with.

    I grew up in a well-to-do family that qualified to be at the top this list according to most of the "barrio alto” criteria, except for one fact.
    My father owned a manufacturing company and we lived in a suburb south of Santiago.

    Personally, I hated the Chilean classist and prejudicial system and was fortunate enough to have my family pay for part of my education at an a University in Ohio.

    If my description sounds a bit harsh about Chileans and their society groups, I can only say that based on what I have been reading in many of these Expat blogs, I see that in this regard little has changed.
    I am an eternal optimist and hope that some of these noxious attitudes change.

    When that happens I will be the first to celebrate.

    Viva Chile, have a scrumptious empanada and a tall glass of great Chilean wine.
    Salud!

  6. I wonder how much this changes being outside of Santiago. It must, somewhat.

    I like abby was kinda pondering the way being a foreigner influences this. I also should be a C2 or C3 but am seen as above that (haha as long as they're not invited to my house) just because of the foreigner thing and because of certain things and clothes that I decide to splurge on.

    seeing actual estimates and qualities really made me think about my social circles, plural, which are quite divided between ABC1 (work and foreign contacts), and D (my social contacts). Most everyone I know that is in the D and E category will not move up beyond that, they have absolutely no resources to do so, nor the time, effort, and understanding to figure out a plan that will pull them out. Their background has been rough enough that even if given the opportunity (I've considered trying to sponsor someone in education or something) they might struggle too much just because they arent entering on par with the rest.

    Consumer segmentation was a huge part of one of the degrees I studied too, so this is really interesting because I've never seen it for the Chilean population, and its super different than the devisions we use in the US. great post!

  7. Again, I am very late to this post, but what you've said is very intriguing.

    When I lived in Chile, I lived with an upper middle class family that had nanas and German last names. This was in Temuco, and it seemed that although not everyone was super rich, they really looked down on a lot of other people. They were all very nice people, but they were mostly the U of C group of kids.

    Meanwhile, I grew close with our nana (we shared the same birthday and spent hours talking in the kitchen), and I could see how much she struggled to provide her daughter with a better life.

    When I lived in Santiago, I lived in Las Condes, and we also had a nana from Peru. The things I heard about immigrants from Peru really angered me. Everyone just seemed so heartless and refused to look at these Peruvians as actual people.

    My point is, there was no way for my nana, no matter how hard she tried, to move her daughter up from being poor to being middle class. No matter how hard our Peruvian nana scrubbed the floors, she wouldn't be able to earn enough to get her kids into the good schools.

    I can relate to them very much, but I believe that it is easier to move up and change your situation if you come from the United States.

    I grew up poor. What made my life a little awkward, was that me and my siblings were the children of a (divorced) wealthy man and a poor woman.

    While we were living in the ghetto, our grandparents, cousins, etc. owned large homes and land in well-to-do neighborhoods; and our cousins all had a lot more than we did.

    Of course, we were looked down on, but were still allowed to enter the social circles of the "higher class" because of our name and our academics.

    I don't strive to be part of the social circle that looks down on other people because of wealth, skin color or national status, etc., but I hope to create my own space of friends and colleagues who don't care about social stations or classes.

    I hope this makes sense!

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