0203 696 0980

India's demographics

Overview

There are a lot of people in India: 1,266 million of them1. Not all of them are potential customers for your ecommerce offer. To start with, not all of them are literate in any language, let alone English (Figure 1):

Literacy levels are higher amongst the young, a demographic much more likely to be online: 83% of 20-24 year olds are literate, compared to only 43% of 65-69 year olds.

Indian demographics, including its national census, almost always make the distinction between urban and rural populations – it really is almost two separate countries in terms of lifestyle. Roughly one third of the population is defined as urban, which is currently where internet usage is concentrated.

Economics

Measured in GDP per head, India is not a wealthy country (Figure 2), and you might perhaps wonder why you might target it at all. GDP growth is forecast to be 7.6% in the next couple of years, but although this is a rate we’d probably be very happy with at home, it isn’t going to transform India into a highly developed economy in the near future. Per head averages, however, are not the best way to look at India.

Even if they are literate, only a small proportion of its population can realistically afford what you are likely to be selling. Over half of all households have an annual income of less than £2,000 per year, and even the most optimistic forecasts predict less than 5% will have an income equivalent to the UK average (approximately £26,5004) by 2020 (Figure 3).

Realistically, you are probably targeting just the top two income groups, roughly 6% of the overall population. But… 6% of India’s population is still equivalent to a country the size of Germany. Moreover, that 6% are almost all literate in English which in turn gives them a global perspective and an appetite for global brands.

Seasonality

India is big enough to encompass multiple climate zones. From a practical perspective, there are (sort of) four seasons, but if your trading calendar is based on an Autumn-Winter (cold and wet) and Spring-Summer (warm and dry) seasonality then it’s probably going to need some modification for India. The key factor is the monsoon, which affects most of the key population centres, and happens in what in the UK we would think of as summer. For most of the rest of the year, much of India is rather dry.

Summary

• There are a lot of people in India! Based on average statistics such as GDP/head, they are rather poor, with literacy levels of only c65% in key age groups such as 30-40 year olds

• However, general “average” statistics about India are unhelpful when considering it as a cross-border ecommerce prospect. There is significant inequality of wealth distribution, with around 6% of the population – about 80M people – likely to be plausible targets

• The plausibly addressable market is comparable in size to Germany and in wealth to Poland, and is growing steadily as India grows wealthier

• Seasonality in India should be borne in mind. Promoting your spring-summer catalogue just when the monsoon starts to pour down is unlikely to be an optimal trading calendar

 

 

 

India's retail landscape

Connectivity and internet usage in India

Marketing in India

India's legal framework

Payment methods in India

Logistics in India