Vernacularization of Digital india: Key Takeaways

“If you talk to a man in a language he understands, that goes to his head. If you talk to him in his language, that goes to his heart.” – Nelson Mandela.

India is a country of over a billion people that speak 22 languages and 720+ dialects. As digital connectivity starts reaching the deepest corners of the nation, it is but natural that our local languages will define the next wave of India’s internet. With this theme in mind we recently hosted an interactive session with industry veterans, Umang Bedi, Miten Sampat and Nav Agrawal to discuss ‘The Vernacularization of Digital India; India internet’s next big opportunity”. Highlights from the session below:

From L-R: Vikram Vaidyanathan (MD, Matrix India), Sanjot Malhi (VP, Matrix India), Umang Bedi (President, Dailyhunt), Nav Agrawal (Co-Founder & CEO, Clip) &. Miten Sampat (VP, Corporate Development, Times Internet)

Snapshot of the Indian macro environment + China learnings:

• A potentially unconstrained market – 800M+ internet user base by 2021
• Vernacular audience: 9 of 10 users coming online are non-English speakers and will make up 80% of the audience in 2021
• Endless supply of data: 5GB+ per capita consumption in India already compared with <4GB in China
• Looking back on learnings from China
  • Phase 1: First set of companies were clones of US companies
  • Phase 2: The biggest horizontal Chinese content companies were created in 2010, under market dynamics similar to those of India today
  • Phase 3: Verticalization and highly specialized niche plays
• Due to rapid growth on the back of Jio, India is already seeing leapfrogging and signs of both Phase 2 and 3 are showing
• Several verticals remain untapped: Only horizontals tapped in India so far
• Multi-player category: several players with slightly varying propositions and target segments; room for several players to co-exist (as seen in China)
• Customers are hungry for fresh & unique content which has enabled higher engagement & virality
• Initial signs of monetization

Know what problem to solve

Indian users want to create content and contribute to the digital world but on a platform that has a like-minded community. Instagram, Twitter, Facebook or Whatsapp are closed communities with limited access to a larger audience, and thus limiting the extent of gratification, which is the holy grail of content. For instance, social gatherings have now transformed into Whatsapp groups, instead of wishing and greeting people in person, all communication now transpires on group chats. Similarly, people previously had access to limited content on TV, and now have complete control over the content they consume. While Facebook, Instagram, and Twitter are solving for the English speaking audience, the gap continues to remain for regional users. Nav commented, “At Clip we receive almost hundred fifty thousand video clips on a daily basis on our platform from the user. They are not using Clip to create the video, its created somewhere else and posted here. And the reason for that is because they found a like-minded community on Clip. They don’t go to say, Instagram or Twitter or Facebook and post it there. Even Whatsapp for that matter, being a closed network, it doesn’t give them enough gratification and thus isn’t used to circulate content either. They come to Clip in the morning, they download good morning content and they share it on their Whatsapp groups and maybe in the afternoon, they look for devotional content. We see it as our daily use case, for example they come to Clip on Tuesday and specifically look for Hanuman ji ka video, everyday there is a different thought process. We have multiple profiles who have got a million followers by uploading say Good morning content or devotional content, or say Bollywood content or politics content. So, people are creating content but we need to give them a platform where they can showcase their talent or showcase whatever they feel like contributing to this digital world. Users in India want to contribute to the digital world but the right platform is hard to find and that’s where we come in.”

Content can be broadly classified into OGC (originally generated content), UGC (user generated content) and PGC (professionally generated content). For UGCthe prime objective is instant gratification and is shared with a network of people, friends, family, to build a social following. With PGCthere is no dearth of its supply, however the issue lies within discoverability, finding the right kind of content is not easy and the content creators often suffer as a result of this. Another by-product of the surplus supply is the dipping levels of the quality of the content being put out. Miten commented, “The reason certain things are easy to do and create is because the product lets you do it. Instagram is very easy to create content right? And for example today I think there is enough and more people creating interesting content. The question is, where is it happening? And whether those products get enough organic pull from the next set of audience. It comes back to how easy it is to create on your app right? I think some products make it much easier than others. So, the product has to be good, people have to feel like they want to come there and create content and why does somebody want to create content? Let’s go back to the fundamentals of that. Why does a person create content? Because they want to hear from an audience.” The learning here is to create a product that gives users a seamless experience, whether your provide it through an ad or a landing page, the other is the ability to build a transactional system basis that experience, which then directly impacts your click through rates and conversions. As an entrepreneur in this industry the crucial questions to ask yourself would be: What problem are you solving for the user, what is your single ‘hero’ use case, can your platform have scale, does it have the ability to enable mass discoverability, can you give the user instant gratification, etc.

Monetization & models:

Following a monetization first approach is paramount in this business. This doesn’t mean there needs to be monetization from day 1, but there needs to be a directional path to monetization and a deep underlying understanding of what gets you there. The internet post Jio pivoted, opening up the market to 70% of India, which was otherwise untapped. With regional consumers becoming the dominating factor, the rise of vernacular languages became inevitable, and thus the birth of multi linguistic social apps. “A strategy that is often mistakenly used to penetrate the market early on in the content business is publishing/curating pornographic content, which is technically a user acquisition strategy not a monetization one. What I would like to emphasize on is pure monetization, and the only way to do it is to start thinking about how you can build a unified platform or an alliance or a network, one that is at par with the global giants if not better. At Dailyhunt we aspire to create India’s largest indic platform. Sinceinception we have focused our attention to provide superior quality and varied vernacular content for our trusted consumers. We believe that focus on user growth, user engagement and deeper monetization via licensed content from reputable partners are quintessential factors of success. The game plan to achieve this in two ways.The first, includes ramping up Dailyhunt as a local language Indian-digital-media platform by adding more users & the second factor is to develop deep familiarity with each user’s tastes, using machine learning and AI, with a special focus on video.More importantly, it is crucial for us to ensure significant effort towards executing an effective user acquisition strategy leading to better monetization. The only way to ensure this is to build a unified platform one that is not only at par with the global giants but if not better. We are extremely thankful to Matrix Partners India for believing in us and having faith in our vision for close to a decade now. We are certainly well on course for becoming India’s largest indic platform catering to India’s heartland or Bharat”, commented Umang.

“Revenue in the media business, is not a leading indicator, it is a trailing indicator, but an integral one, nonetheless”, said Miten. Creating and putting out the right kind of content is no longer the trick, but knowing how to monetize it, is. Miten further added, “It’s gotten progressively tougher for publishers, with the integration of Ad-tech with content platforms to derive a source of revenue for themselves, and monetization through a dynamic and customized model is key. From a scaling perspective, as a publisher or creator of content the only way towards accelerating growth is to build moats over time. We have gone full stack in some places, where, we have built everything from the content to the app to the monetization, in some cases, we become the aggregator also. I think in the next eighteen months the OTT ecosystem put together is going to spend between four to five hundred million dollars commissioning content. Now if that isn’t monetization I don’t know what is.” Monetization further needs to be sliced into performance vs. pure brand, ascertaining how much share is coming from performance is key. The way to look at this is to visualise an ecosystem at a global stage, try to understand it fundamentally, and build something unique, that can withstand the macro changes.

Social media 2.0

If you have two hours to spare, you go to platforms like Amazon prime, Netflix or Hotstar, but if you have 5 mins to spare you would look for a platform that has bite sized and snackable content, for which machine learning or tech assistance to serve the right content to the right audience is required. Creators will go where they think they will get an audience and an opportunity to monetize their work, and the Indian user will choose the best product in the world, regardless of where it’s made from. Umang concluded, “Why did Chinese companies do so well? They banned Google and Facebook. Now, I am not saying go ban Google and Facebook. But what are we doing at an India level? I think a lot of those companies have divided and conquered. It’s digital colonization happening, whether I look at the top of the pyramid or I look way at the bottom of the pyramid, and that’s the elephant in the room. So, somebody, whether it's bureaucracy, whether it’s government, whether it's folks like us in the ecosystem, the elephant needs to be addressed for a change to be brought about”.

To truly tap into and empower Digital India, leveraging the diversity and honing in on the wealth of vernacular content, is the only way for forward for social networking platforms to unlock the real potential and grow beyond the boundaries of language.

If you are building a company in this space or have a point of view on this, please write to us at mediasocial@matrixpartners.in