New Report Encourages Innovation for the Next Half Billion in India
Omidyar Network releases report to help entrepreneurs profitably serve the next 500 million Indians who will come online in the next five years
MUMBAI, India, Dec. 19, 2017 /PRNewswire/ -- Based on insights from 10 years of funding purpose-driven entrepreneurs in India, Omidyar Network today released a report, Innovating for the Next Half Billion, detailing how innovators can effectively reach the next wave of Indians coming online via their mobile phones over the next five years. Called the "next half billion," these low- to lower-middle income Indians have very different income profiles, education levels, language skills, and social and cultural milieus compared to the initial Indian internet users.
Economic progress, increasing mobile penetration, and the rapid decline in data costs have enabled a growing number of Indians to become mobile internet users. Three in four adults now have a mobile phone, while almost 300 million have smartphones. All of this means that populations that businesses couldn't reach before are now easily accessible, leading to a new wave of entrepreneurship. These entrepreneurs are looking to provide products and services that will improve the lives of the next half billion, a segment that was previously underserved and disempowered.
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However, the next half billion use the internet differently and face seven unique barriers in their digital journey, which entrepreneurs will need to address:
- High data service costs
- Lack of indigenous apps for social media and communication
- Paucity of local language content on the internet
- User interfaces and experiences not adapted to the next half billion's social/cultural context
- Lack of confidence to transact online
- Reticence in using the internet by women, a key customer segment
- Lower purchasing power of the next half billion, which underscores need for frugal innovation
Entrepreneurs will need to understand and directly address these barriers in order to profitably serve this population. Localization will be key, particularly in respect to India's variety of languages, but also in breaking in to spaces in social and communication currently dominated by U.S.-based platforms. Social and cultural perceptions are also hindering use of online services; for example, this population has not been exposed to the self-service shopping experience, so icons like shopping carts and language like "checking out" can be foreign and intimidating. Additionally, many in this population perceive the internet as a "bad influence" that will damage marriages, leading to limited or restricted online access for women, a key consumer demographic in the next half billion. Finally, this is a frugal population that will require highly affordable data services and innovative approaches to building businesses that can both earn their trust and address their needs in a cost-effective way.
"The next half billion represent an incredible opportunity for entrepreneurs," said Roopa Kudva, partner and managing director, India at Omidyar Network. "But for these startups to be successful, they need to truly understand their users – the barriers they face and how they can be addressed. We believe home-grown Indian entrepreneurs are particularly well-positioned to leverage this understanding into both social impact and financial success."
About Omidyar Network
Omidyar Network is a philanthropic investment firm, established in 2004 by eBay founder Pierre Omidyar and his wife Pam. We create opportunity for people to improve their lives by investing in market-based efforts that catalyze economic and social change. In India, Omidyar Network focuses on helping the hundreds of millions of Indians in low-income and lower-middle-income populations, which we define as ranging from the poorest among us to the existing middle class.
Omidyar Network has committed more than $1 billion through equity investments in for-profit companies and grants to nonprofit organizations that foster economic advancement and encourage individual participation across multiple areas, including Digital Identify, Education, Emerging Tech, Financial Inclusion, Governance & Citizen Engagement, and Property Rights.
To learn more, visit www.omidyar.com and follow on Twitter @omidyarnetwork #PositiveReturns
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