As India’s booming internet market matures and business models change with the latest technologies, the Kantar India Digital Team identifies the seven key trends that will define the subcontinent’s digital ecosystem in 2025.
The internet has made striking advances in the last few years. It now penetrates all aspects of our life, from leisure and education to business, across demographics and geographies.
While the internet is widely accessible, thanks to affordable data packages and mobile devices, the vision of a digitally hyperconnected India remains in its nascency. But in the very near future, this vision will materialise and present a new world of opportunities and challenges for India’s businesses and marketers.
Kantar forecasts that internet users in India will grow at a CAGR of 10% over the next four years to reach over 900 million users by 2025. With urban India already a hotbed of internet use, rural India will be the major contributor to this growth. By 2025, India will witness a surge in the maturity of internet usage and changing business models incorporating new-age technologies.
With the combination of internet user growth and advanced usage, Kantar has identified seven key trends that will define the Indian digital ecosystem in 2025.
Trend 1: By 2025, more than half of online shoppers will also buy products from social platforms.
Shopping on social media platforms with live video selling offers consumers a personalised shopping experience that was lacking in the traditional e-commerce model. It has garnered the attention of shoppers, with 27% of online shoppers having experienced social commerce since 2021. It is expected that by 2025, more than half of all shoppers will also buy products through social commerce.
Apart from offering significant convenience to buyers, this will lead to the proliferation of entrepreneurs and homepreneurs who have thus far not been able to expand their reach. Therefore, their business remains small and largely bound by geographical constraints.
Trend 2: Online health and wellness will become the second largest online shopping category by users.
Online healthcare includes services like the purchase of medicines and healthcare equipment, booking a doctor’s appointment or pathology test, attending a virtual consultation, and getting information on ailments and medicines. At present, online medicine and healthcare equipment shopping is the third largest online commerce category by number of users, in both urban and rural India.
By 2025, it will become the second largest, trailing online fashion shopping. Online health and wellness services offer the scope to provide last mile delivery of easily accessible and affordable medical services, while also potentially reducing the burden on hospitals by limiting hospital visits to serious medical issues only.
Trend 3: Half of the urban households will have at least one smart device in addition to the smartphone.
Devices like the smart TV, smart streaming stick, smart speaker, smart lighting and other smart appliances have become popular in recent years. Indian households are also adopting smart security solutions for their homes. They are also increasingly accessing the internet through non-traditional methods.
In the coming years, the use of IOT-based devices will spread to small towns and rural India as well. A key factor driving the adoption of smart devices beyond metro cities will be the incorporation of a voice-based interface available in multiple regional languages.
With 5G being rolled out, India will have the necessary infrastructure to support a hyperconnected ecosystem.
Trend 4: Online education will touch the lives of 50% of Indian students by 2025 and help bridge the gender gap in supplementary education.
Edtech has witnessed tremendous growth over the years, especially during the pandemic. It will continue to remain relevant in India and develop further as immersive technologies become mainstream.
While providing supplementary education remains the prime service area for edtech firms, it is also gaining prominence among non-students for skill-building courses and relearning. Currently, 40% of edtech users are non-students.
Edtech will also play a key role in bridging the gender gap in education, with one out of every two users being female by 2025.
Trend 5: E-governance will gain popularity and become universal by 2025.
Currently, 62 million individuals use e-governance services (excluding bill payment services), with the majority hailing from urban India. In rural India, most of the services are assisted e-governance because such services are state-driven with low adoption rates in northern and eastern areas.
This is expected to change with higher adoption and growth of e-governance in states that currently have lower penetrations. With higher internet use in rural India in the coming years and the development of the digital payments infrastructure in rural India, e-governance will see higher adoption.
Trend 6: Agritech will be defined by public-private partnerships, digital agriculture apps and drone technology.
Agritech is an upcoming facet under e-governance, with public-private partnerships expanding the reach of digital services to farmers.
Agriculture apps that cover aspects – such as tracking prices, providing access to online marketplaces, online advisory services, access to finance and insurance online, and advice related to farming tips and methods – are expected to grow in prominence.
These apps will not only be relevant to farmers who are currently online but will also motivate current offline farmers to move online.
Trend 7: One in every three microbusinesses in urban India will spend on online commercial transactions.
Digital will not only benefit the end consumer but also India’s micro businesses. Micro businesses are expected to make a lot more commercial transactions online, be it buying online, selling online or advertising online.
As per Kantar’s ITOPS Business study, by 2025, one out of every three micro businesses will be doing some form of commercial transaction online. This will be a significant shift from the current status where it is less than 15%.
Going forward, the consumer and business landscape will evolve rapidly, enabled by digital. The emerging trends will have several implications for businesses and marketers.
- The internet will no longer remain a mobile-only phenomenon. The use of smart and interconnected devices to access the internet will become common. This means that marketers will need to diversify their targeting strategies to capture market share through multiple digital mediums.
- Consumers will seek more personalisation and customisation of products and services. Localised customisation of products with tailor-made designs for a specific region will gain prominence. These products and services will start competing with products from established companies. Influencer marketing will play a key role in the promotion of these localised products and services and influencers will no longer need to be celebrities but be local opinion leaders.
- The consumer set will evolve to include Gen Z users, individuals from small towns and rural India. The incorporation of voice and Indic languages in the user interface will help capture and retain these new consumers. With the inclusion of immersive media, whether it is AR/VR or the metaverse, the user interface will become even more engaging. Brands will have to expand their capabilities to connect with consumers through these new platforms.
The digital world view of 2025 is an exciting one as it will herald newer experiences and opportunities for both consumers and businesses. However, it is important for all marketers to be ready to draw the best out of this evolving digital ecosystem. Marketers, specifically those who use the internet as a driver for their business, will need to constantly focus on adopting cutting-edge solutions, like AR/VR, the metaverse, etc, that will help them stay ahead of this digital curve and continue to engage their customers.
At the same time, they have to be aware of a vast majority of Indian users who will need basic services and thus tailor their offerings for them through localised content, vernacular and voice-based communication and commerce services.
Therefore, marketers will need to balance between bringing in the most evolved digital solutions while ensuring that their offer remains relevant to the masses. Kantar’s seven key trends for the digital landscape will help marketers remain focused on things that really matter to their customers.