Indrani Sen: Digital India: A Reality Check

08 May,2017

By Indrani Sen

Last week, GroupM released ‘Interactions_2017’, an insightful and interesting report on global overview of digital marketing.  In the report there is no specific mention of how digital interactions are tracking in India, though along with many other countries of the world, India has also been covered. It is a must-read for Advertisers and Agencies in India, who can use it as a crystal ball for gazing into our digital future.

The report contains from highlights of countrywise data along with a snapshot of interesting developments of interactions in that country and Appendices with data on E-commerce, Interactions Ad Investment, Adult Internet Users, etc. I have used the data for BRICS countries to do a reality check on Digital India, which shows that we still have a long way to travel to reach the top of the table among the five countries.

Smartphone penetration as % of phone users

2014

2015

2016

2017e

Brazil

42

62

75

89

Russia

42

45

50

58

India

21

26

30

33

China

45

56

71

77

South Africa

85

85

85

90

Source: Intercations_2017

In spite of having one of the highest growth rates of mobile penetration, India is still at the bottom of the table with 33% of smartphone penetration as percentage of phone users.

Adult media usage percentage 2014

Online

TV

Print

Radio

Total

Brazil

22

44

10

24

100

Russia

31

38

4

27

100

India

23

59

6

11

100

China

45

33

8

14

100

South Africa

32

31

10

27

100

Source: Interactions_2017

The dominance of TV in adult media usage was highest in India in 2014, when comparative data for all five countries were available. ‘Interactions-2017’ has shown the statistics for the other four countries apart from India from 2015 to 2017 (estimated) where figures from India have been shown as not available. Globally, on a population-weighted average, the media day grew by 9 minutes in 2016, riding on a 14 minute rise in online. It is expected that similar changes have also happened in India.

Total E-Commerce in USD Billion E-Commerce per user USD

2014

2015

2016f

2017f

2014

2015

2016

2017e

Brazil

12

13

14

16

120

114

116

115

Russia

18

23

26

30

413

499

460

509

India

16

21

26

33

63

61

61

66

China

413

579

742

920

844

1107

1325

1533

South Africa

0.4

0.4

1

1

26

26

33

33

Source: Interactions_2017

The total value of e-commerce has doubled in India from 2014 to 2017 (estimated). However, a comparison of e-commerce per user shows that India is at the bottom of the table among the four original BRIC countries. This is due to the huge rise in the number of adult internet users in India which has almost doubled from 2014 to 2017 (estimated) as shown in the next table.

Adult internet users

2014

2017e Growth%
Brazil

102,387

137,700

34.4

Russia (U)

44,691

58,347

30.5

India

260,000

503,000

93.4

China

489,806

600,000

22.5

South Africa

16,705

18,400

10.1

Source: Interactions_2017

The huge number of users is pulling down India’s performance when it comes to advertising investments in digital media/ interactions per user and is again pushing India to the bottom of the table with only 3 USD per user against 82 USD per user of China.

Interaction Ad Invest. USD million Interaction Ad Invest. Per User USD

2014

2015

2016f

2017f

2014

2015

2016f

2017f

Brazil

847

1,524

994

915

8

13

8

7

Russia

1,359

1,558

1,895

2,210

30

34

33

38

India

510

742

1,096

1,423

2

2

3

3

China

22,787

31,368

40,628

49382

47

60

73

82

South Africa

111

152

214

268

n/a

n/a

n/a

n/a

Source: This Year Next Year 2016 / Interactions_2017

What is encouraging for India is the share of digital interactions of all media investments has doubled from 2014 to 2017 (estimated). We need to invest in an accelerated rate in this area to improve our performance among the BRICS countries as apart from Brazil, all other countries have much higher share of digital interactions in all media investments. China, which leads the table, is estimated to have 57% (estimated) interaction share of all media investments against our share of 14.9% (estimated) in 2017.

Interaction Share % of All Media Investments

2014

2015

2016f

2017f

Brazil

4.3

7.3

4.8

4.3

Russia

24.9

31.5

35

37.2

India

7.8

9.9

12.9

14.9

China

33.1

42.3

50.8

57.2

South Africa

8.7

11.7

16.6

20.7

Source: Interactions_2017

 

To sum up, it is evident from the statistics reported by ‘Interaction_2017’ that demonetisation has not been able to give the desired boost to digitising India. I think we may have to wait for another decade before we can even start dreaming of rising to the top of the digital interaction tables of the BRICS countries.

 

Indrani Sen is a veteran media agency and marketing services professional. She is currently an Independent Consultant and Adjunct Professor, Media Management at Symbiosis Institute of Media & Communication, Pune. The views expressed here are her own.

 

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