Women, villages and the less affluent drive internet growth in rural India

The message from Nielsen's latest India Internet Report is that media planners need to get out of the reach game and get more creative to leverage the new type of audiences coming online

Women, rural India and lower-income homes are among the fastest-growing cohorts of internet users in India. Nearly half of rural India is online and usage here went up by 40 per cent in 2022 over 2021. In the same period usage went up by 35 per cent among women and by 30 per cent among NCCS D, E audiences (those at the lower end of the income and education spectrum). Across India smartphone sharing is high. And digital payment is among the fastest-growing applications. It grew 43 per cent in 2022 over 2021.

These are the key takeaways from Nielsen’s India Internet Report 2023. It reinforces the ubiquity of the internet in our lives. But more importantly, it indicates that media firms and advertisers need to start thinking differently about how they are using it, reckons Dolly Jha, managing director, Nielsen India. “The profile of audiences coming online will require a more focussed effort on creative and measurement,” she said. For instance, vernacular platforms are rising in reach. The number of platforms across short video, music or social media is multiplying. “Advertisers will need to experiment with other platforms,” says Jha.

This could be a challenge. Going by Comscore data, YouTube had 463 million unique visitors. Meta (Facebook, WhatsApp and Instagram) has between 300 million and 500 million users depending on which app is being used. The dominating reach of this duo means that they take away almost 80 per cent of the Rs 24,600 crore that went to digital advertising in 2021.

In its second year now, the Nielsen study is based on a random sample across state and population strata of 33,000 Indians. Some of the findings are obvious and some not so much.

The internet is used by 720 million Indians over the age of 2 years, according to the study. More than half, about 425 million, are from rural India. Urban India, with its 295 million users, saw growth at about 14 per cent, less than half of rural India’s. Though urban India is a high-value market, rural India has more headroom for volume growth, reckon analysts. Nearly 90 per cent of internet users are daily users. The urban and rural gap in daily usage has narrowed compared to last year, with 93 per cent and 86 per cent daily users respectively.

Almost a third of Indians are using the net for banking and payments. But this application shows a marked skew toward urban males in the age group of 20-39 years.

The most startling finding is the multiplication of the audience due to sharing of devices. About 85 million users (39 per cent) in rural India watch videos or attend online classes with others. This culture of shared media harks back to a time somewhere in the nineties, when every copy of an Indian language paper was shared by anywhere between four and 11 readers. As per capita income rose, newspaper sharing has become almost negligible.

That, it seems, is what is happening with smartphones. Nielsen says it does not capture the number of people sharing a smartphone on an average. But it confirms that smartphone sharing is higher among lower-price band handset owners and less affluent homes. Overall, smartphone sharing is 36 per cent. Amongst smartphone owners of handsets that cost Rs 10,000 or less, it is 44 per cent, says the Nielsen report.

This ties in with a trend this newspaper reported earlier this year. As their prices hit the roof, smartphone adoption at the middle and lower end has stalled and therefore the internet’s growth stalled in 2021 and most of 2022. Many of the people who have been left out of the march of the internet are now joining in through shared devices. That explains why usage or time spent continues to grow.

What does it all mean? It means that the next round of advertising on the internet has to go way beyond the obvious big-reach brands such as YouTube and Meta. For example, if you want to reach females in, say, NCCS A homes, how do you decide where to advertise? “Which platform is available? Within those platforms how is their (ad) inventory graded? Publications will have to do a sharper job of categorising their inventory,” said Jha. Again much of this finds resonance in the interest shown by investors in hyperlocal apps such as Public and Way2News that do not play the reach game. That is where the growth in online advertising should come from in the future.