Special Address at The Economic Times Masterclass on Rural Marketing. December 16, 2015

Technology Transformation:Impact & Implications

Prakash Bagri

@prbagri

What I hope to cover…

• Understanding Technology– Why? Relevant?

• Implications for Rural Marketplace

– And marketers

• Some experiences & thoughts

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• 25 years ago

• 15 years ago

• Today

• Rural India is one market

• The Rural consumer seeks to ape the urban consumer

• To succeed, a cheaper product at a lower price-point will do the trick

• We need to develop scalable models

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Myths then… and now

Myths then… and now• Rural India is one market

– ~10K urban agglomerates & 600K villages

– Different & how!

• The Rural consumer seeks to ape the urban consumer– S/he has a solid mind of her own.

– And a world-view beyond their urban brethren

• To succeed, a cheaper product at a lower price-point will do the trick– Within two year, 1 out of 3 smartphones sold will be in rural

• We need to develop scalable models– Scalability is a myth. Where lies the trick?

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WHAT DROVE THIS CHANGE?

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The Malabar Fisherman, 1997

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The Digital Provide: Information (technology), market performance and welfare in the South Indian fisheries sector”, by Robert Jensen. Quarterly Journal of Economics, August 2007

Fishermen's profits 8% ↑, Consumer prices 4%↓ Payback 2 months!“Information makes markets work, and markets improve welfare”

Not just price discovery, but price determination

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What changed?

• The hierarchy of adoption does not hold, any

longer

– No trickle down effect, adoption almost instantaneous

• Rural consumers don’t blindly ape urban

– Form unique usage models, and might even be trend

setters

• Their opinion leaders are changing

– Physical presence is no longer a prerogative

• Their field of reference is changing

– “The world is my oyster”

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WHAT DROVE THIS CHANGE?

I will come back to it..

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UNDERSTANDING

TECHNOLOGY

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Technology’s Transformational Impact

Technology = τέχνη, λογία

techne: activities, skills, art

People, materials, equipment, processes, tools

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Technology’s Transformational Impact

“Created creates creator!” PJ Bonhiem (1935)

An active, not passive force! An enabler

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Technology and Moore’s Law

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Nielson’s & Edholm’s Law

The Great Disruptor!

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Internet’s Disruptive Force

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Information, Reach, Convenience & Economics

From I= HW x SW

Proliferation of Devices

Computing Growth Drivers

1960-2020 (Device/ MM Users)Source: Morgan Stanley Mobile Internet Report (12/09)

Avalanche of Applications

Mobile Application Download &

Revenue Forecast 2010-14Source: Gartner

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From I= HW x SW to 𝒊=𝟏𝒏 𝒉𝒘𝒊 𝒔𝒘𝒊

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The App-ification of the World!

Democratization of Innovation

• Knowledge

• Creation

• Funding

• Incubation

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The Implications

• Technology: An active force

• The domain of technology expands

• Increasing access, leading to ubiquity

• A network of connections on which innovation

will continue to build

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RURAL MARKETS

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What changed?

• The hierarchy of adoption does not hold, any longer– No trickle down effect, adoption almost instantaneous

• Rural consumers don’t blindly ape urban– Form unique usage models, and might even be trend

setters

• Their opinion leaders are changing– Physical presence is no longer a prerogative

• Their field of reference is changing– “The world is my oyster”

The models to reach and engage need to adopt to the technologies of the future

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Perspectives on Rural Markets

• Just like Markets ≠ ΣConsumers,

• Rural Markets =

ΣConsumers + ΣBusinesses + ΣEntrepreneurs +

ΣCommunities + ΣObservers +⋯

• Rural Markets = B2C + B2B + G2C + C2C

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Scalability: The Holy Grail

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Don’t get caught in the search of scalability. It’s elusive.There will be multiple models. Seek replicability

Perspectives on Rural Markets

• Rural Consumers = Poor Consumers?

– Paisa packets and sachets

• Rural Consumers ≠ Poor Consumers?

• Seek value. Always did.

– Value then was availability

– Today it is much more.

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Rural Consumers Leapfrog Technologies

• PCs to Laptops

• Landline to mobile

• Feature phone to smartphone

• Compact to Sedan to SUV

• SMS to MMS to OTT Apps (WhatsApp)

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“Less is More”

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IMPLICATIONS

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The Changing Paradigms

• Products & Services

• Platforms

• Partnerships & Communities

• “Profits”: the three dimensions

What remains the same:

Problem Solving

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The rural consumer will make bigger

leaps moving forward….

…… technology will be a bigger

driver

We need to ensure that they don’t

leapfrog our proposition!

™ [email protected]

Thank you!

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