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The availability and affordability of smartphones with access to cheap internet data coupled with the rise in disposable income is fuelling the growth of digital penetration. Reach of e-retail channel – In next 3-4 years, more than half of India’s incremental Internet growth is expected to come from rural India. Additionally, the digital user demographic is expected to expand beyond the traditional stereotype, with a significant growth in female and older Internet users by 2020. This will result in a larger market size across different geographies, age and genders and not just a small targeted group. The diversity in the Internet users will facilitate an opportunity for online retailers to expand their product portfolio as per the increasing customer base. Impact of digital age – Though, Internet has penetrated to 400 million users today, but they are different in usage behaviour and needs. 60 percent of rural Internet users go online using Internet enabled phones and not smartphones. The major use of Internet in rural consumers is limited to entertainment, education and social networking. The online purchase behaviour is best predicted by the ‘digital age’ (years spent online), and not by demographics. With an increase in digital age, the internet users even from rural areas are expected to use e-retail for making their purchase decisions.
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