__p When 360 Magazine published the results of its first Emerging Market Census (EMC) last year, it was the first time that a census of this magnitude was carried out. Partners in over 100 hinterland cities were surveyed to get a realistic reflection of the penetration level of IT in India’s heartland. And the findings were enlightening.
p____p This year the survey results revealed the changing business environment of non-metro markets. As IT awareness in these cities grew, so did the concerns. While service-related issues continue to plague partners in these cities, its factor of importance was rated lower than the unhealthy trade practices that have crept into the channel business. Partners voiced concern that the growing menace of short-term operators will destroy the trade for serious players.
p____p As partners in these cities are still learning the nuances of big business, it’s essential to ensure at the onset itself that the channel adopts transparent trade practices, in the interest of the majority. Or else these markets, with their limited entry barriers, could become lucrative looting grounds for traders with a short-term view.
p____p Buyers in emerging markets are still in the nascent stage of IT awareness, one bad experience could very well scare them away from the market, a situation that no partner would want to encounter. Associations that operate in the interiors need to become more active and double-check the credibility of a new partner.
p____p EMC 2004 also indicated interesting trends in PC penetration. While the number of PCs sold in B & C class cities has increased impressively, it is heartening to note that the number of system integrators who sold more than 50 PCs a month increased in percentage terms. Some sub-distributors do business of over Rs 100 crore in these markets.
p____p But the most significant finding of EMC 2004 was that the hinterland markets continue to grow at a vibrant and rapid rate. Unlike other revenue opportunities that have proved to be over-hyped, the quest for IT products remains undeterred in the heartland of India.