India continues to be the world’s second-largest internet market after China. But it also happens to be the largest untapped internet market in the globe. With close to 900 million people without internet connectivity, internet access is expected to bring more than 1 billion people online. There’s little doubt that the opportunity for Next Billion Users is going to come from India’s Tier-2 & 3 cities.
According to a Nielsen report, 2/3rd of internet users in India are in the age group of 12-29 years. And this age group corresponds to more than 70 percent of internet users in non-urban areas. India’s tier 2 and 3 cities commonly referred to as ‘Bharat’ have become the Holy Grail for startups. With better infrastructure, cheaper data plans, and affordable smartphones, Bharat’s citizens are all set to go fully digital in the next few years. The potential of ‘Digital Bharat’ hasn’t gone unnoticed by startups and they are building customized solutions keeping these audiences in mind.
The Indian start-up ecosystem is at an extremely exciting stage. The pandemic created a lot of challenges but it also gave way for new business models to rise. India has a couple of unique factors at play, apart from being a highly dynamic market it also has a varied set of audiences. Being a country of myriad cultures, languages, and influences, there is no one rule to map the consumer persona. Startups that have the agility to cater to the changing needs of users both in metros and non-metros are the ones set up for success. To reach the last mile consumer in Bharat, no one ‘Indianised’ umbrella app can work. The demands and behavior of consumers in smaller cities vary vastly from those in metros. Consumers in ‘Bharat’ display an affinity towards their regional language and culture. Apps that have received great user reception and success in Tier-2 & 3 cities are built on the foundation of hyperlocal, regional, and customized.
One such example of this regional custom-built model is the success of the dating app Aisle. The #2 most downloaded dating app in India, and the leader in high intent dating, Aisle is the perfect app for people looking for serious relationships. As an app that understands the dating needs of India’s young population, Aisle wanted to go a step further in delivering a customized regional dating experience. This led to the launch of ‘Arike’, India’s first-ever vernacular dating app. Within a span of 5 months, Aisle has launched ‘Arike’, an online dating platform for the Malayalam-speaking audience, and ‘Anbe’ which focuses on the Tamil community. Aisle is just one example of how a focus on regional influences plays a key role in delivering to non-metro consumers.
India is a large regional language consumption-driven market and has had a long history of regional FM channels, movies, and theatre. India’s familiarity with radio both in metros & non-metros led people to jump on the podcast bandwagon. There’s been a rise in regional podcasting with people covering topics including spirituality, education, government exams, etc. Regional language self-publishing platform Pratilipi recently acquired IVM Podcasts to tap deeper into the Tier-2 &3 audiences. Pratilipi has over 3.5 lakh (0.35 million) writers and has published over 4.5 million stories in ten Indian languages. The company also has other products including Pratilipi literature, Pratilipi comics, and Pratilipi FM. The comics and FM categories have over 8 lakh and 3 lakh active users, respectively.
Second, to podcasts, vlogging saw exponential growth during the pandemic. The rise of micro-influencers in Tier 2 & 3 cities led to the rise of influencer-led marketing on social media channels. Trell, started as a lifestyle-centric video blogging platform and has now evolved to a regional language-based social commerce platform. The platform sells lifestyle products and almost 60 percent of Trell’s users come from Tier- 2 & 3 cities including Lucknow and Jaipur. The company is also building a video commerce platform where a customer can purchase products based on video content generated by content creators.
The market to build for Bharat is massive and is mostly still untapped. With metro markets becoming saturated, the need is for startups to create compelling solutions for consumers in small cities. There are vast white spaces that are perfectly positioned for custom-made products, but the focus needs to shift to ‘what products will work better in Indore or Jaipur as compared to Delhi or Mumbai.’