Why tier 2, 3 and 4 cities are becoming hot markets for edtech

If there is one industry sector that was pushed several years ahead in its journey during the COVID 19 induced pandemic – it was edtech. Although it can be argued that all tech got a boost from the COVID-19 induced lockdown – I can still say it with considerable confidence that edtech was put on steroids like no other.

In fact, I want to highlight here that the primary boost came not from big tier A cities – it was ushered in by cities in tier 2,3 and 4

This has been another unique characteristic of edtech and has been so for some years. Business plans get made on assumptions on tractions that the product would have in usual top 10-20 cities/geographies but some months down the road it’s the next 20-30 that start to spring surprises and the top 5 usually disappoint. And one wonders – why is this so.

Reasons are not that hard to fathom and let’s look at them in the sequence:

1. Promise of quality

While the situation in conventional schooling and teaching remains a lot to be desired everywhere, the quality problem is far more pronounced and urgent as we go down the tiers.

Parents in these cities, aspire as any other of being able to provide the best possible education to their children, see the deliverance in quality that edtech promises.

Content from the best possible sources can be available ensuring quality and delivery standards equal to or exceeding what is available in the big cities.

2. Affordability

This is one thing that technology is inherently good at, driving down costs and ensuring affordability, and Venture Capital funded technology is many times better at it.

While the big city folks also have the means to evaluate and procure other costly options, affordable quality content/services delivered on cheap internet to the people who don’t have too many options, is just what they have been waiting for.

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3. Promise of in-step with everyone

The cutting-edge nature of technology-based learning is perhaps another big draw for people who are fearful of letting their children into a world they are not prepared for. This message is exaggerated and amplified by every channel of sales and marketing.

Just because it appears new and futuristic many people in lower tiers cities also see that as an opportunity to bridge the perceived gaps that may or may not exist.

This rapid acceleration has however, and with some justification, prompted some questions if edtech is indeed delivering its much-hyped value especially in 2,3, 4^th rung cities or are consumers being fleeced without getting much in return. This concern is serious enough to have prompted legislative discussion and call for action.

In my opinion, some of these concerns are justified and there should be more oversight, preferably by an independent and progressive regulator into what gets dished out in the name of education.

However, in a nation such as ours with all the advantages of a very large and young population eager to learn and become productive and all disadvantages of low overall quality of schools, all other child development, sports, vocational and continuing education delivery mechanism – rapidly expanding edtech footprint is the one and the only plausible way to develop as fast as possible.

And all the reasons for which parents are opting for edtech in 2,3 and 4^th tier cities are real. Also, the technology components to realise that dream of quality delivered in quantity while still being customized for individual needs are available and mature.

What is required from edtech companies is innovation and real intent and not some maddening rush for numbers solely for valuation – which would come anyway if you had a great product. What is also required is more information, advice and education be made available to parents and students so that they can make informed choices.

A combination of consumers who have all the information with them to make appropriate decisions with EdTech companies that have great products that deliver value will surely go a long way in putting nation on path of development not yet seen.