The title for this book is borrowed from Gulliver’s Travels, an eighteen-century classic by Jonathan Swift, describing Gulliver’s adventures in the imaginary Land of Lilliput. While many higher-order and nuanced interpretations of this novel exist, I have always loved the straightforward, literal story of a land of small-sized people together overpower the giant Gulliver, who is so many times bigger than any one of them. It has always seemed to me a perfect, albeit simple, metaphor for India.

When the BRICS report from Goldman Sachs first came out in 2001, I was struck by the point it made that in future, the world’s largest economies may not be the world’s richest economies. And that exactly describes India, which today has the global clout of being the world’s fifth largest economy, on track to becoming the world’s third largest economy by 2030. Yet, today, it ranks well below 100 in the world in terms of per capita GDP, an indicator of how rich each Indian is. Even with the kinder metric of Purchasing Power Parity (PPP), India’s rank improves only slightly.

As a corollary, India’s mega consumption story, one of the largest and most exciting in the world, has Lilliput-like characteristics too. It is a story of lots and lots of small consumers earning and spending just a little bit each that adds up to an enormous amount. They are served by millions of small suppliers, oozing innovation, agility and customer intimacy that is the envy of large companies. The whole ecosystem is powered by an unparalleled digital infrastructure that seamlessly supports billions of small transactions every day.

All this results in a very challenging business economics made tougher by India’s heterogeneity and geographical scatter, further compounded by the fact 4 that ‘modest income’ and ‘small’ consumers do not mean ‘un-evolved’ or willing to settle for the suboptimal. Quite the contrary. Over the years, large companies have felt the pain of serving this Lilliput Consumer India—high on expectations, low on income, with mostly small ticket sizes. Except for a handful, many companies have retreated to serving only consumers at the top of the income pyramid, thus playing in a tiny fraction of the total opportunity. These consumers too have Lilliputian incomes compared to even the average income in developed markets. ‘Lilliput Land’ has given many an MNC ‘Gulliver’ a run for its money.

What’s changed in recent times is the advent of digitally led, new-economy business models in other parts of the world. Businesses like Alibaba, Amazon, PayPal, DoorDash, AirBnB, Uber, Instagram and several others, particularly in services sectors like education, healthcare, logistics have provided clues of how to profitably play in the Indian market. They have inspired a flurry of vibrant Indian start-ups, the common thread being the digital business model capable of building profitable scale by bringing together the small – scaling up supply by aggregating small suppliers, scaling up demand by aggregating small consumers and scaling up the addressable market by enabling sharing of high-value products and services by lots of small users. This is the future of competition in Lilliput Land. Large platforms comprising myriads of small consumers and suppliers, digitally yoked together, will drive the future of India’s mega consumption story.

The title Lilliput Land: How Small Is Driving India’s Mega Consumption Story and this book are both dedicated to India’s small consumers, small suppliers and small transaction digital warriors who have together built and will continue to build the world’s most watched and least understood mega consumer markets. Let’s stop waiting for the coming of age of India’s consumer markets. That happened a while ago.