HOW MOBILE INTERNET HELPED E COMMERCE COMPANIES PENETRATE RURAL INDIA

The retail sector in India has undergone a significant transformation in recent years, thanks to a surge in Internet penetration and the rise in mobile phone users. The buying capacity of India is also changing from the urban to the rural. The introduction of technology and the internet in rural areas has increased connectivity manifold. Hence, the audience is now seeking out better options when it comes to purchasing. Therefore, we are now seeing a majority of them seeking out e-commerce players. Here’s an in-depth look at how mobile internet has helped e-commerce companies in rural India.
 
Accessibility Grows
Thanks to e-commerce companies, people living in tier 3 and tier 4 towns now have access to more products than ever before. The introduction and spread of mobile internet have made it easier for e-commerce companies to spread in rural India. Also, such facilities have made it easier for them to set up distribution centers in and around the control. Such centers facilitate smooth delivery in rural areas, which is something that was lacking before. The introduction of COD options everywhere has also made it easier for the rural population to buy products online.
 
Rise of Mobile Internet Penetration
More than 60% of the population in urban India have access to high-speed mobile internet. Therefore, mobile internet penetration will now make ripples through rural India. While certain areas in India have only 18% of mobile internet penetration, we will see a 15% growth in the years to come. Most of the people who make use of these facilities are 25 years old or younger. This change in penetration will most likely result in changes in the buying trends of this population. Studies say that by the end of 2021, the market will reach a value of $12 billion. Also, more than 536 million users will have access to the internet, with penetration hitting 45% by 2021. Therefore, retailers will need to have tie-ups with e-commerce platforms if they wish to make it big in the future.
 
Lifestyle growth in rural India
Rural India has undergone several changes in the near past, and the use of e-commerce companies has risen significantly. The main reason being the increased availability of options thanks to the internet. Another critical factor is the increase in income. With a substantial portion of the young, rural population migrating to urban areas, they have more money than before.
Similarly, they are also more used to buying from online stores. A huge problem that rural buyers faced in the past was not being aware of the options available to them. Also, a fear of e-commerce platforms and the failure to understand how they worked prevented them from ordering online. 
 
However, since many works in urban areas and know how things work, this has changed. Over the last few years, more and more buyers have started ordering from such platforms thanks to their confidence in online portals. Diversification has helped the rural population move towards non-agricultural income sources leading to higher revenue generation. As per Ernst & Young, the rural population contributes 57% of retail marketing, amounting to $359 billion.
 
Localization and Choice
Hence, there is an increase in demand, and more people are entering the workstream to meet the demand. While the rural market is mostly untapped, e-commerce companies are trying to improve their logistics in rural e-commerce. The biggest challenges they face is the localization and providing the right mix of products for their rural customers. The rural population has little use for a large number of more high-end products, and require more earthy and affordable products. Therefore, online retailers must provide them with the correct mix of branded and unbranded products.
 
Using the right technology
Technology will play an essential role in serving this rural e-commerce market. With digital literacy increasing like never before, we will soon be able to reach out to this populace with ease. In urban areas, e-commerce companies are making use of modern technologies such as AI, VR, and AR. While this might not make an appearance in rural India soon, they will play an essential role in attracting rural customers in the future.
Similarly, the usage of drones for delivery is picking up in countries around the world. In the years to come, we can expect this technology too to have an impact on the Indian ecosystem. While the rural market segment will take more time to adopt such changes and handle challenges such as lack of digital addresses, we will soon overcome these issues.
 
Looking forward to 2020, we can rest assured that the market is trying in every way to capitalize on the rural market. With internet penetration likely to grow to 45% by 2021, the CAGR for rural e-commerce will hit $10-12 billion. Since 88% of this population does not speak English, more e-commerce platforms will switch to regional languages to get accepted in this market. Research shows that in 2021, more than 85% of the 300 million new users will be from rural areas in India. Effective supply chain planning, building more cost-effective marketing, and making use of alternate delivery models will help e-commerce companies significantly.