Almost 15 per cent of rural consumers use the Internet to research products, purchase a product, or register satisfaction or dissatisfaction with a product after the purchase is made, compared with 30 per cent of urban consumers according to a report, The rising connected consumer in rural India by Boston Consulting Group (BCG) that looked at, among other things, the differences between rural and urban Internet users that marketers must take into account.
The amount of actual online commerce in rural India is still small, but it is picking up according to the report. From 2015 to 2016, the penetration of online purchasing in these areas doubled from four to eight per cent. Convenience and discounts are the key reasons that rural consumers buy online. The degree of digital influence is as high in rural areas as it is in cities the report found. Today, the purchases of four out of five rural Internet users are digitally influenced, which suggests that as Internet penetration rises in rural areas, so will the influence of digital.
The report said that the primary activity of the Internet-connected rural youth (18-30 years) was to access social networks, play games and listen to music or watch videos. Mature users, between the age of 18-50 who have had access to the Internet for over three years, also used their phones for e-mail, behaviour almost mirrored by urban mature users. "The habits of the rural and urban youth might be similar but the time spent is different. They will all use, say, Facebook and WhatsApp but the rural youth will spend time on the Internet in short bursts while their urban counterpart may spend all day.
There are also shopping habits, availability of products and the price points, that are all markedly different," said Harish HV, partner at Grant Thornton.
The report believes that India's Internet economy could triple in size to $200 billion by 2020 and a big part of that growth will come from rural markets. What must companies do to ensure that they reach the rural users? For one, companies must develop a segmented view of the market and stop painting all rural consumers with the same brush. Secondly they must not try and use the 'one size fits all' approach and develop new models. Companies must also focus on creating an experience with the rural consumer in mind, a consumer who uses smaller devices and where connections are slower. Up to 300 million Indian consumers are expected to be online by 2020 and most of them will be from rural India, the report said.
