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Demonetisation drive comes as windfall for e-wallets

While citizens are trying to recover from the note ban bomb, there are a set of people who are not bothered by the snaking queues outside banks and ATMs. As e-wallets and online transaction become the new buzz words, BestMediaInfo finds out what's in store for these players

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Demonetisation drive comes as windfall for e-wallets

Demonetisation drive comes as windfall for e-wallets

While citizens are trying to recover from the note ban bomb, there are a set of people who are not bothered by the snaking queues outside banks and ATMs. As e-wallets and online transaction become the new buzz words, BestMediaInfo finds out what's in store for these players

Roshni Nair | Mumbai | December 6, 2016

E-Wallet-DIgital-Wallet

When Prime Minister Narendra Modi announced late on November 8 that Rs 500 and 1,000 notes will no longer be considered legal tender, the country was thrown into a tizzy. As confusion and speculation spread far and wide, a set of people got busy soon. On November 9 morning, a leading English daily hit the newsstands with three full page ads, one after the other, on e-wallet services.

FreeCharge, Paytm and Ola Money capitalised on the demonetisation bomb the PM had dropped on unsuspecting citizens. In the days to come, people were disgruntled because of shortage of cash and businesses were hit too, that is, barring e-wallet service providers. Being a country that traditionally believed in cash transactions, Modi's move came as a shot in the arm of e-wallet players. There was no way to turn but go digital.

Not only have these platforms seen an unprecedented increase in number of users, they are also reaching out to consumers in every way possible. Be it newspapers, billboards or the internet, e-wallets are everywhere.

“We have definitely increased our ad spends to reach out to our markets. The increase is almost four to five times of what we used to spend earlier. Helping people is our stand right now and we also don't want to lose out on the opportunity. So, yes the ad spends have increased many folds for us and so has the traction from users,” said Akash Gupta, Vice-President, Marketing, MobiKwik.

MobiKwik, which was at a base point of 32.5 million users on November 8, today boasts of 40 million users. It is gunning to cross the 50 million mark by December end.

While people may now be looking at e-transactions with growing interest, it is not an easy category to create communication for. People are still not comfortable with going online with details of their finance due to lack of awareness. Lack of internet penetration plays a part in making this a difficult category to market.

Deven Dharamdasani Deven Dharamdasani

“The biggest challenge is to create communication that changes the 'mindset' of the audience and to do that these platforms need to find the trigger that will push the audience to use these platforms on a daily basis. Considering the fact that Indians are used to use cash, it will be a draconian task for these platforms to make people believe that the transaction they are doing is safe, can be executed from anywhere, no need to depend on a physical ATM, and that data privacy is taken care of. In the era of a fight between telecoms for data, it is these kinds of platforms that will reap the real benefit and pass on the same to the user,” said Deven Dharamdasani, COO, SVG Mobile.

Gupta feels this is the bane of every tech-oriented platform.

“It is true for any tech-oriented start-up or tech-oriented platform. Yes, I agree that it is not very easy for us to coin the right communication but at the same time it was a great opportunity for us to crack something that had to be so simple that even a normal Indian could also understand it and in fact that is exactly what we have done. For example, we launched this new product a few days back called MobiKwik Light. All the user has to do is give us a missed call and the app will be downloaded automatically on his/her phone. Now this too communication was a challenge. So we coined this line 'Mobile number do, paise lo'. That is the communication that we shortlisted and people are understanding it,” added Gupta.

Ankur Saxena Ankur Saxena

On the other hand Ankur Saxena, CEO, Oxigen Wallet, feels that with demonetisation half the battle is already won. “Although I agree that India as a whole is a very cash subject economy I think with demonetisation, half the battle is already won. The topic of e-transactions is already out there in everyone's mind, if anything, it is easier to sell to either the consumer or the merchant now. So, when we advertise they immediately connect with the solution and what we are able to provide, so we have really not faced any challenges around this,” said Saxena.

When asked about the best medium to advertise for such a platform, both Gupta and Saxena vouch for the reach that radio provides.

“When I was making the marketing plan for MobiKwik I was wondering how to reach the common man who might be walking on the street or sitting inside a shop in Chandni Chowk. We did a few studies and research and understood that such an audience is very radio-savvy. They listen to FM a lot. We have picked up FM as a big medium to reach out to the market. Our FM spots are very easy to understand and are running in 30 to 35 cities. Apart from that we have picked up high-impact digital mediums like Facebook, YouTube and others to communicate about MobiKwik. Print has also worked tremendously well for us, especially the regional language newspapers,” elaborated Gupta.

Apart from tapping radio and print, Saxena is also leveraging India and its love for movies to bring Oxigen to the minds of the masses. “Indians love watching movies and that is why cinema is a good medium to advertise on. While the PVRs of the world are there, there are also single screen cinemas where advertising can get some good traction,” said Saxena.

Are cashbacks and offers a good way to lure customers in with so much competition in the category?

“Cashbacks are something that used to be the talk of the town. Six to eight months ago they used to be the driver. But right now it is not a driver, it could be a simple enabler in some cases. The world is very competitive and our competition is very strongly giving a lot of cashbacks offers and although we are not going really aggressive, we are trying to match.”

Saxena on the other hand thinks cashbacks are a slippery slope, “Our position has always been that cashbacks are a slippery slope and you can't really buy loyalty with cashbacks. Keep giving cashbacks and my wallet will have plenty but what happens after is a different game altogether. I won't subscribe to that, we do give little here and there but it is almost like loyalty points. We strongly feel that providing the right user interface and the right customer experience drives much more loyalty than cashbacks in the long run.”

But while the advertising spends of e-wallet platforms have increased, they themselves have emerged as lucrative platforms to advertise on.

“Yes, more and more clients are looking to advertise with such platforms. There has been a sudden growth in e-wallets and that means a surge in traffic which makes it an interesting proposition to advertise on,” said Sanjeev Jasani, Head, Digital, Cheil India.

“Clients are definitely keen to advertise with these platforms. However, these platforms right now are focussing on activating new users and reactivating the dormant ones. The wallet platforms are already witnessing a huge surge in daily active users (DAUs) and the biggest challenge for them is to retain them. Looking at the impact of demonetisation, the DAUs will only go up for the next six months. All the wallet platforms are now getting to enter or penetrate tier 2 and tier 3 markets, which is where they will get the real growth. Once all the hullabaloo settles down in six months, that's when is the right time for advertisers to explore these platforms and reach out to relevant audience,” explained Dharamdasani.

Even with all the frenzy surrounding e-wallets, one can't deny that Indians were grossly unprepared to adapt to e-transactions. Are Indians as a people and as consumers ready to embrace this change now?

“Over the past six to 12 months, we had seen a gradual increase in the acceptance of e-transactions by consumers and merchants. More and more people had started using plastic and new products like e-wallets, albeit slowly. The recent move by the government will be a shot in the arm for e-payments, as is evident over the past two weeks. There has been a massive increase in card transactions, which have grown by 150 per cent. The adoption may be a little slower in rural areas but more people armed with smartphones and Aadhaar-linked debit cards will help them try and adopt e-transactions quickly,” said Deepak Chandnani, CEO, South Asia and Middle East, Worldline.

“If you asked this question a year ago or even six months ago the answer would have been that unless you are incentivising the customer it was lot harder to get them to transact electronically, given a lot of handicaps like internet penetration and fear of doing transaction online but now slowly people are in one way or another trying e-transactions and are finding that it is a very convenient. So I think there is a change and anyway smartphone and data penetration is growing at a rapid rate with some of the newer players coming in and dropping the prices, which is helping the whole scenario quite a bit. So we only see a good upward trend,” said Saxena

Highlighting the role that e-wallet platforms play in easing Indians into online transactions, Dharamdasani said, “Whether Indians are ready for e-transactions or not is a question that everyone is looking for and hoping at the same time that Indian consumer will easily adapt to e-transactions. However, the onus lies with all these platforms that how much trust are they able to build among users in terms of (a) ease of transaction (b) safety (c) tactical offers, because as Indians we all love freebies and all these freebies changes our mindset from being a conservative consumer to a value driven consumer.”

Jasani like many believes that e-transactions are the future, “The recent demonetisation problem has shown us how today even our milkman is ready to accept payment through an e-wallet like Paytm. I feel the adoption rate has improved with time. I for one am completely convinced that this is the future.”

But is the entire buzz around e-wallets a passing phase or is it here to stay?

“Well all this frenzy and buzz around e-wallets is here to stay, however the larger challenge is how many wallet platforms are able to encash and sustain this opportunity. The frenzy will only go up when from April '17 onwards you will see one of the largest e-wallet and one of the largest telco player getting in private banking. That will begin the era of Fintech in India and that's where there is another sea of opportunities lying for someone to go and encash. The best thing is the Fintech ecosystem will be supported by the Government,” said Dharamdasani.

Giving the example of mobile prepaid cards, Jasani said, “I feel the buzz will last for sure. People initially thought that mobile prepaid cards were a frenzy and wouldn't last. It not only lasted but flourished as well. E-wallets will definitely last the test of time and will flourish through new innovations coming in as well in this space.”

Chandnani forewarns of a 'plateau' in digital transaction after the initial spike, “Currently, 86 per cent of the country's cash has been rendered illegal and there is an unexpected rise in the demand of all digital payment products, be it cards, POS terminals, wallets or IMPS. In order to manage and sustain this demand, there will have to be relaxations in certain norms to make it less cumbersome for service providers. Easing or tweaking some regulations is needed in order to smoothen the supply of things like terminals and cards. As is natural, there will be a sharp rise in digital transactions for the next few months after which we will see it plateau, especially once there is more liquidity in the system. It is important that customers become habituated to making easy cashless payments so that they continue to do so in the future.”

Info@BestMediaInfo.com

Info@BestMediaInfo.com

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