India is quickly becoming a hot export market for American entrepreneurs. On top of its rapid population growth, India’s tech sector is booming. Even better, its rising, young, and often English-fluent middleclass is hungry for American brands.
India is the second most populous country in the world, with over 1.27 billion people — or 17.5% of the world’s population — residing within its borders. It is expected to surpass China as the world’s most populous country by 2025, with its population exceeding 1.6 billion by 2050. It is a young nation, with a median age of 25, and a middle class that is expected to grow tenfold by 2025.
Alongside its population and overall economic growth, India’s tech sector has garnered a lot of attention in recent years. In 1998, tech was responsible for 1.2% of India’s overall GDP, a percentage that increased to 7.5% by 2012. According to reports from NASSCOM, tech is expected to aggregate revenues of $147 billion (USD) in 2015, while export revenue makes $99 billion, and domestic makes $48 billion.
Mobile is the new Ambassador
The increasing availability of smartphone technology has undoubtedly played a huge factor in the country’s tech-evolution, and it remains a strong conduit for e-Commerce in the region. India has seen rapid growth in its mobile usage, and is expected to soon become the second largest smartphone market worldwide. According to Yahoo’s Flurry Analytics, India’s app usage is growing at a rate of 131% year-on-year, outpacing global growth. Phone and tablet growth in India is outpacing growth in the US, and the country is expected to have 236 million mobile internet users by 2016,with the number reaching 314 million by 2017.
This means mobile compatibility should be a key focus for eCommerce hopefuls looking to export to India. As much as 50% of the $7-billion e-Commerce business is mobile-based; a number that will undoubtedly grow. The ubiquity of mobile commerce has caused some drastic marketing moves: online fashion retailer Myntra went ‘app only’ in May, with talks that its parent company Flipkart might follow suit.
Most experts agree that a mobile-only approach is a little extreme — even in India, desktop computing is still strong, and preferred by many — but every business should at least have a mobile counterpart to their online store. Many of us know the annoyance of trying to use our smartphone to navigate a web page designed for a computer screen with ten-times the display size; fidgeting with dropdown menus and side-bars, and using our fingers to click links designed for a mouse cursor. Plus, Google’s recent updates to its algorithm favor mobile-friendly sites for searches performed from a smartphone.
An attractive destination for US brands
India’s growing buying power and openness to eCommerce have made it a hotbed for international trade. A 2014 report from CBRE India, entitled “Expanding Horizons of Global Retailers in India,” says that about 60% of all global retailers currently have a market presence in India. However, the United States is already a clear frontrunner, with US brands controlling 30% of the market for international brand-name merchandise throughout the country, trailed by Italy and the UK.
The CBRE India report goes into more detail, explaining that, “fashion accessories, F&B, and beauty and cosmetics happen to be the most penetrated retail segments in terms of the presence of global brands in India; while hypermarkets are the least penetrated, largely due to the legislative barriers imposed on the category.”
While there’s clearly a demand for a plethora of American exports in India, it can be a bit more of an intimidating market than the UK or Canada. Trade tariffs are more complex, and while English is on the rise, there are numerous cultural considerations that should be considered when marketing and advertising in the country. An experienced eCommerce expert from Iffel International can help transform your brand to appeal to Indian consumers, create a mobile-optimized online store, and help you start reaping the benefits of trading with an exploding economic world power.
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