The 2018 edition of Mary Meeker’s eagerly anticipated Internet Trends report is out and provides one of the most comprehensive insights into the global digital landscape. This year, the report covered a wide range of important themes from mobile usage and the rise of cryptocurrency to work patterns and immigration. One of the most important topics covered was the rise of China’s technological growth and how it will very likely overtake the US in terms of innovation and advancements.
While the 2018 report hasn’t covered India in depth, it is still an excellent barometer by which we can understand how the digital landscape here compares to the rest of the world. India’s internet growth has followed a very different path due to several factors that are unique to the country. While the US and China are already massive established markets, India’s strength lies in the fact that this is still an emerging market. This presents a huge potential waiting to be tapped into.
Here are a few key takeaways from the Mary Meeker Internet Trends Report 2018 and how India compares.
2018 records the highest number of people on the internet. Almost half of the global population, around 3.6 billion, are now connected via the internet. One of the reasons for this is the growth of WiFi networks across the world. Today there are around 450 million WiFi networks globally, as compared to five years ago when there were only around 100 million.
In India, however, it is not so much WiFi that is spearheading the growth of the internet, but mobile data. Drastic reductions in the price of mobile data have made the internet more accessible to all sections of the population. One of the catalysts for this development was the launch of Jio. Of the 150 crore GB of mobile data consumed by Indians, 100 crore GB was through just the Jio network. Google has made some strides with its Rail Wire initiative and there is free WiFi available in over 370 railway stations. They recently reported 7.5 million users consumed 7,100 terabytes across these stations. Additionally, 80% of all enquiries come in through mobiles. Because of this, mobile platforms are becoming increasingly important for brands. Speed and convenience are two of the most-valued features in Indian markets. This is why brands here are beginning to adopt a ‘mobile-first’ approach and utilise AMP-implemented landing pages to improve a user’s experience and generate higher leads.
Global internet adoption rates are growing slower than they ever have. In 2017, internet user growth stood at only 7% as compared to 12% the previous year. This could be because since most people are already connected to the internet, there are fewer new users to be added.
In India, however, a completely different scenario is unfolding. Up until 2016, Indian internet users were growing at an incredible 28% annually. Mobile data, cheaper smartphones and growth of vernacular content online has played a pivotal role in expanding the internet beyond just urban areas, into tier 2 and 3 cities and towns. Most significantly of all, internet penetration in India stands at only 27%. This shows that there is a huge opportunity for brands to take advantage of as internet adoption in the country continues to rise.
While the total time spent on mobile devices is increasing, 2017 marked the first year where smartphone shipments showed no growth. Again, this could be because the number of smartphone users around the world has more or less plateaued. The year also witnessed a paradox, wherein despite some of the most expensive phones such as the iPhone X and Samsung Galaxy Note releasing, global average smartphone prices are falling.
As a fast-growing market, India’s smartphone sales figures were markedly different. Counterpoint revealed that India recorded an incredible 48% YoY growth in Q1 of 2018. The demand was for affordable smartphones which still provided a wide range of features. It comes as no surprise, therefore, that Chinese phone brands known for providing just this dominated the market. Of the 10 top selling phone brands in 2017, 6 of them were by Chinese manufacturers.
While consumers in the US are spending more time than ever on their smartphones, mobile advertising budgets are not reflecting this. An average adult in the US spent around 5.9 hours on their mobile phone each day in 2017 as compared to 5.6 hours in 2016. But while advertisers are slowly branching out into mobile advertising instead of just traditional advertising, this shift isn’t happening fast enough. While 29% of time is spent on mobile, only 26% of advertising budgets are used for mobile platforms. This has resulted in a $7 billion gap that brands need to take advantage of.
In India, this potential might be far greater. As the country begins to benefit from cheaper mobile data and smartphones, higher digital literacy and greater access to digital content online, the number of hours spent on their phones will also increase. Currently, Indians spend 89% of their total online time on mobile data, far greater than the US average of 29%. Because of this, a study by Nielsen and BCG identified a $100 billion opportunity for digital consumer spending in India. One of the biggest contributing factors for this was the growth of mobile internet in the country.
One of the biggest trends in 2017 was the advancements made in voice technology. Google’s Machine Learning technology achieved a 95% accuracy, which is the same as that of a human. Amazon Echo’s sales also skyrocketed to 30 million in 2017 as compared to 10 million the year before. Consumers today are more willing to use voice search as accuracy and convenience of the technology improves.
As Google’s Indian language voice search accuracy improves, more Indians are beginning to use it as well. 28% of all searches on Google in India are voice searches. There has also been a 400% growth in Hindi voice search, indicating the willingness of users to perform voice searches in vernacular languages. The Google India Search Insights 2017 also showed that there was a 63% jump in data/voice usage. Moreover, 7% of all travel-related queries were through voice. Google Home and Amazon Echo were also launched in India recently, however, they do not support Hindi as yet. It remains to be seen how the lack of Indian language recognition will impact their adoption in India.
Amazon is by far the biggest player in US e-commerce sales. In 2017, it had a 28% share of the e-commerce market, with $129 billion in Gross Merchandise Volume (GMV). To put this into perspective, it had only a 20% share of the market in 2013, with a GMV of $52 billion. The report also showed that most product searches today happen directly on Amazon. While 36% of product searches are conducted on a search engine, 49% of them are started on Amazon. But while Amazon is the biggest e-commerce player in the US, at $701 billion, Chinese e-commerce giant Alibaba has a much higher GMV.
Back in India as well, Amazon is growing at a breakneck pace. In FY2017, Amazon announced that it had grown in its revenue by 105% in India. The number of app downloads for Amazon crossed 100 million by November 2017, with around 4.8% users visiting the app every single day. In the five years since its launch, Amazon has overtaken homegrown e-commerce companies like Flipkart and Snapdeal. The only competition for Amazon India could be Alibaba who has also announced plans to expand into Indian markets.
These findings prove that India’s rapidly expanding market presents a huge opportunity that brands cannot afford to ignore. As more Indians continue to come online, India will soon become an important player on the global digital stage.