Is India ready for the big boom?

I have recently returned from a 10-day work trip to India. As a global registrar, we value the opportunity to travel and learn about how business is done in different parts of the world. We don’t write about these trips as often as we should, but I felt compelled to share my experience in India, as it was unlike any other experience I have had.

I can’t help but start describing India from a personal viewpoint: it’s sensory overload. The sounds, the sights, the tastes, the smells, the textures put your mind and creativity into high gear. It requires an abundant dose of open-mindedness, to be fair, but I loved every minute of the experience (maybe I did not love the Mumbai traffic jams that much).

From a business standpoint, it’s also very different from any other country I have visited. We had the privilege of attending 25 meetings in 2 cities over the course of 5 days. We spent a lot of time with our resellers trying to understand the current landscape and trends. Our reseller network in India is varied: hosting companies, website building companies, and even Telcos. The insight we gathered from these meetings was invaluable, and the level of energy and passion was contagious. As I was sitting on the plane, processing all my notes from the meetings, I started to see some very clear trends. And these trends led to a question: is India finally ready for a digital boom? Before we answer that, let’s look at some of the trends we have uncovered:

Data is now incredibly cheap

On our first day of the trip, we asked Sanjeev, our India-based sales representative, to take us somewhere where we could buy SIM cards. Sanjeev’s answer was: “You don’t need a SIM card. I can create a hotspot for you. I have 1GB of data a day and I pay the equivalent of $1.50 a month.” Say that again, Sanjeev? 30GB of data a month for $1.50? As a Canadian used to paying $100 a month for 6GB of data, I started crying on the inside. Data is now cheaply available, and millions of people who have never before had access to the Internet are now online. This is a recent and fundamental shift that may change the Internet game in India.

The opportunity is real (and huge)

The numbers people quoted during meetings made my head spin. The population of India is 1.3 billion people and there are approximately 50 million SMBs in the country. However, there are only 5 million domains registered (mostly .COM and .IN), which represents a miniscule 0.38% of the total population. The Internet market is massively underdeveloped.

A younger generation is taking over the business world

More than 50% of India’s population is below the age of 25, and more than 65% is below the age of 35. By 2020, the average age of an Indian will be 29 years old. A new generation is taking over the business world and getting online is a top priority. This is a rapid change that can be seen everywhere. Across all sectors, the conversation is shifting from “why do I need a website?” to “we need to be online as soon as possible”.

The India of today is not the India of 5 years ago

Truth be told, we heard horror stories before we left for India. To our surprise, the country we saw was far from the supposed reality of which we had been warned. It made a much more positive impression. When asking the locals about recent changes, they all said the same thing: life in most areas is improving at a very rapid pace. A few years ago, going online was not considered a top priority but, as the quality of life improves and basic necessities are met, the thought of being online becomes real.

There is no doubt in my mind that the opportunity is real, but there are also important barriers for the country to overcome before it can be launched into the digital era:

India is not a Do-It-Yourself country

Generally speaking, the concept of paying for DIY solutions hasn’t been embraced by Indian culture. There is a clear expectation that someone else will build that website. Service is part of the culture, and it’s no different when it comes to building an online presence. As one might expect, the companies that are seeing the most success are the ones that offer web design services alongside their core offering (hosting, website builder or eCommerce). Trying to succeed in India with a DIY offering will require more than just marketing dollars; it will require a large-scale behavioral change among consumers.

Facebook is the platform of choice for most users

Being on Facebook is obviously being online, but in the eyes of hosting providers, website builders, and domain registrars, the platform serves as a competitor/alternative choice, rather than a gateway to using their services. Facebook is easy to setup and maintain, and it comes with an audience. Convincing users that they need more than Facebook is difficult and, in all honesty, Facebook may indeed be all users need in a lot of instances. When we asked our resellers who they saw as their biggest competition, the answer was almost unanimously, Facebook.

Resistance to new gTLDs

The vast majority of the domains registered in India are .COM and .IN. Awareness of new gTLDs is extremely low, and when the customer is presented with the option, the suggestion is met with a high degree of skepticism. It may be a while before customers are ready to embrace less obvious TLD choices.

Lack of coordinated effort

In many ways, it’s the wild west. Everyone is trying to figure it out. Everyone is building their own solutions and partnerships seem to be limited. Without coordinated effort, things are more difficult, and they end up taking a lot longer and costing a lot more.

So, is India ready for a digital boom?

In my opinion, India is going to start growing at a much faster pace in the next 12-24 months. Maybe it won’t be a fast-and-furious boom. We may see a faster-than-normal growth rate for a few years. A lot of the building blocks seem to be in place, but companies looking to provide website or domain solutions to this emerging market will need to figure out how to overcome the barriers. A bigger question that comes to mind is: are companies ready to benefit from the growth? Some are, but most aren’t. Being ready means making a concerted effort to understand the people and the culture. Going in with a one-size-fits-all approach will inevitably culminate in failure. More importantly, if you are starting to think about India now, you may be way too late.