Gather round kids, thread time! I want to share an interesting finding on how fast internet usage habits are changing in middle-class India.
First, a story. When @rchowdhri, @alokgoyal1971 and I were starting Stellaris, we read an interesting BCG report on Indian online users (what do I say, we didn't have much to do those days). One concept that caught our eye was how internet usage changes with "digital age".
Take my mother: when she first started using the internet, she only used Whatsapp and Facebook. Over time she started reading the news, then watching videos online. Then came online research on what to buy, where to travel, what to eat.
Then the first tentative bill payment, the first train ticket booked on IRCTC. And then, hallelujah, the first physical product - a book from Flipkart, strictly cash on delivery.
This "digital coming of age" is a journey most Indian users take over 4-5 years. In BCG parlance, "propensity to buy online is highly correlated with digital age" - the longer you've been online, the more likely you are to buy something. Check out this chart: 
Why was this interesting? In 2016, 3/4th of India's internet users had come online in the previous 4 years. As those users traversed their "digital coming of age" journeys, there was an almost predictable windfall waiting for transaction-oriented internet companies around 2020.
Now comes the interesting bit: Turns out the journey is *accelerating*. Clearly, the transition from social media to content consumption was spurred on by cheap bandwidth. But to my surprise, these new users are already doing deep online research on products and services.
We recently conducted due diligence on a healthcare company, and found that local language users from small towns are researching symptoms, diagnoses and surgical options online, and clicking through to providers' websites.
User after user said the first thing they do after speaking to the doctor is "check on google". These users are ready, willing and able to spend on healthcare services, and they are now online.
Compare that to our interviews with a similar user base in early 2016, when a majority of users didn't know they could do Google search on the phone. One respondent memorably asked, "Google? Uske liye to cyber cafe jaana padega na?"
If consumers are researching surgeries online, they are almost certainly researching insurance, mutual funds, cars and every other complex purchase online. This has two implications:
1. Very soon we should see a major shift in ad dollars towards digital advertising. Indians already spend more time on their smartphones than others. Now a huge portion of the consuming class is spending that time researching purchase decisions. Advertisers are bound to take note
2. There is an opportunity to disrupt the leaders in all these categories. There is a new user base to be targeted with a new value prop, new UX and new languages. The leaders who were once startups are now slow-moving bureaucracies, waiting to be challenged by new startups.
If you're building a company that helps the user with a complex purchase decision, or provides a complex service online, know that a new kind of user is already online. Build for her. Then come talk to us. :-)
