Monetising the demonetisation decision: The Paytm story

The past few weeks have had non-stop coverage of the demonetisation of currency and demonisation of mistry. The jury is still out on both these controversial decisions. Particularly, the demonetisation drive has split public opinion like never before. If I look at my close circle of friends, I've never seen them split to take up two diametrically opposite sides of an issue like this ever before - one camp owning up the decision and actively preaching its benefits, while the other is getting its claws out and sparing no opportunity to go on a full rampage.

This post is not my attempt to step into this minefield. This is an observation from the sidelines on how some people have seized the moment and capitalised on this historic decision.

While its true that this move gave a natural boost to offerings of financial institutions and financial service providers, none had the speed of response and temerity as Paytm. While pretty much everyone was caught unawares on 8th Nov when the decision was announced, a few were able to recover and respond in order to capitalize on the move.

Paytm brought out full-page print ads congratulating the Prime Minister, with a word play on its tagline ‘Ab ATM nahin, #Paytm karo.’ They did not stop there, but followed it up with marketing to keep the buzz on, while also working on the app to simplify usage for new users, and adding features that helped work around the cash crunch.

Not surprisingly, the bold move was met with staunch criticism & they briefly were caught in the political cross-fire. Paytm's Vijay Shekhar Sharma deftly avoided some of these direct volleys and also took swift steps to recover from few of the moves that turned controversial. Like all controversies, these also added to the brand recall and eventually worked in their favour by adding to the kitty.

It was surprising to see neighbourhood stores and roadside vendors accept cash on paytm in barely a couple of days after the decision. While there are plenty of e-wallet players in India, many who have existed for much longer and few with deep pockets like Airtel, Paytm has managed to stay high on recall and captured the imagination of people. 

Consequently, they have emerged a winner in round one. As the moves towards a cashless society get stronger, there is a lot more action to watch out for in this space.

Facebook's misstep on data privacy with Whatsapp

Facebook received bad press yet again last week, after its internet.org fiasco in India, several months back. You might have got a notification on your Whatsapp that the 'terms and conditions' had changed and you'd need to 'accept' them to continue using the services. One of the key changes in this was the user's implicit permission to let FB use their Whatsapp profile info to sell more targeted ads on your Facebook account. 

Image source: Techcrunch

And, this created considerable outrage, with a lot of messages going viral (within whatsapp!). There were talks of privacy breaches and how Facebook has started invading more spheres of our private lives. The messages also educated users with a simple set of steps on how to turn this setting 'off' in Whatsapp.

If for a moment you take a dispassionate look at the whole thing, it doesn't appear to be so alarming. Here is a parent company (Facebook) trying to cross-leverage its presence and services with a subsidiary (Whatsapp, which it bought for a bomb of $20 Billion), to better monetize the user base. The users were anyway getting both the services for free. And the new terms clearly stated that only the whatsapp user profile details would be used and none of the chats, groups or other interests would be shared.

Then why the outrage? Its not new in the B2C space for companies to cross-leverage or cross-sell services across their spectrum of products or subsidiaries. Take Google for instance, who has systematically achieved deep integration amongst their wide gamut of products, wherein consumer intelligence from one product enriches the others. But, the fundamental difference here is that the features for the user have always come in first and hence have been well received (though not without its share of suspicion); like the smart Google Now that simplifies your life. Facebook has erred by putting the carriage before the horse, and attempted to monetize first without linking the two for user's gain.

This apart, a side issue has been the perceived dishonesty or malicious intent in the way users have seen FB roll this out. The nature of an implicit, hidden agreement that kicks in when a user 'accepts' T&C certainly didn't help. When you try checking-off the box to disagree on usage of your profile info for ads, the prompt checks 'Are you sure you want to do this? You'll never be able to change this ever again'. Why should this sound like a once-in-a-lifetime favor that FB is doing you. After all, its a user preference and one might be okay to go back and enable the link when they see some benefits coming their way.

Finally, another undercurrent for all of this is the extremely accurate and targeted nature of the ads on Facebook, which has put off a lot of people. Actually this is one area FB must be congratulated for the accuracy they've managed with their algorithms! Unfortunately, the market at large doesn't see it that way. The advances in analytics have been exponential in a brief span of time in an unregulated market, that unpeople haven't been able to fathom it yet. 

A personalized recommendation is not seen as a smart salesperson suggesting just-the-right product, but rather like an intruder who has not only got into your house without permission, but has setup a canopy right in your living room to sell stuff by overhearing what you talk to your family!

M-commerce: Are we ready?

'Move over e-commerce, the time of m-commerce has come..', or so claim the technology gurus. The past month I've been receiving a series of promo messages on my mobile. Some of them go like this:

"Download BookMyShow's mobile application. Use the following pin and get Rs. 100 off on your movie tickets."
"Kotak Mtrade Contest: Enable MTrade application and login atleast 5 times & win exciting prizes."
"Book your air tickets between 15 to 20 March through our mobile application and get a flat discount on all tickets booked in this period."

There is a great deal of push from companies cutting across services to get the customers accustomed to m-commerce. This seems to make business sense given the fact that all these companies stand to gain from a medium that is much more closer to the customer and literally at his/her fingertips. After all, the mobile gaming and mobile application markets are touted as the next big thing in India. So, GPRS services and mobile-commerce are the logical next steps.

However, in a stage where even Internet commerce is not fool-proof and hasn't got the complete buy-in from the Indian customer, will m-commerce cut ice with the targetted segment? When one looks at the percentage of GPRS-compatible mobile phones sold in the market and the maturity of GPRS services, it becomes obvious that this clearly is a market with a long gestation period. In my opinion, m-commerce needs more customer-education and assurance at this stage, for the small base segment thats existent today, before one can jump onto the promos bandwagon.