A winning combination

The service industry is going through a phase of massive transitions. With digitization, there is a huge leap in scalability that is now possible for the dissemination of services. However, so far the needle has typically swung towards extremes—either there is digitization without adequate service, as in the case of online shopping or service institutions with not enough digitization, like teaching.

The way of the future is to use the power of digitization with the complexity that only the human touch can lend. With that you have the dissemination of the service over the digital platform but the service itself is done by people specially trained to deliver it. For instance, patent filing or media planning. In fact, even something like transcription. Companies like TutorVista (which has tutors in India using the internet to deliver one-on-one tutoring to students across the world), CastingWords (which sends off audio files to members to transcribe and revert over the net), Samasource (which distributes computer-based work to poor people around the world) are all examples of creating value at a global scale using a combination of digital and human.

To the service industry, this adds a layer of innovation—creating services that were otherwise not even possible. The example of TutorVista stands out. Personalized tutoring that goes beyond your neighborhood or city is something no tutor had thought of. And now you can sit at home and earn by tutoring students in the US or UK, where these services are exorbitant.

And in terms of adding value to the digital platform, this goes beyond just dumping content on to a server and forgetting about it. There is a growing trend, for instance, of content aggregators. They may deliver it to you impeccably, but who is going to tell you what it means? Who will give you the analysis?

The power of the internet and the digital platforms is not lost on anybody. And given the fact that labour costs are rising every day, there is only that much that one can scale up in terms of human resource. In places like India, where labour costs are still manageable and some level of skill development in place, the potential for such services is high. We just need to identify the right pain points and address them.

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The mind of the Indian youth

Anywhere in the world, whenever there is a mention of the Indian economy and market, people often talk about the demographic advantage this country enjoys. It is a youthful country with high disposable incomes, they say. The oasis for marketing companies across the world! But there are few studies available that give insight into the attitude, behaviour and perceptions of this huge consumer base.

Blyk, which is a youth-focused brand addressing consumers in the age group of 16-29 years, reached out to its 1.68 million members to understand them better. There are three observations that I particularly wanted to share from this study. These observations are key to understanding today’s Indian youth, because it looks at the essential parameters that make them tick.

What comes out very strongly is that the Indian youth is trying very hard to balance modern and progressive outlook with the rootedness in culture and family. They are faced with contradictions of behaviour and mores. It was interesting to note that while 46 per cent admitted to cheating in a relationship, 61 per cent youth thought it was un-cool to be rude!
They are to a great degree driven by perception and are highly aspirational. For example, 3 out of the 4 youth that we spoke to wanted to change the way they look in some way or the other. And there is a significant proportion of young people in India who own more than 5 pair of shoes, use cosmetic products on a daily basis and want to sport branded clothes. Image is everything and they take good care to build a good image.

And finally, the gadget closest to their heart—no prizes for guessing this—is the mobile phone! The youth spend the most time on it. It is the most stated object of desire and used most extensively, which highlights the growing importance of the third screen as a vehicle to reach out to this group.

Having shared these observations, I would still say that this is a very dynamic group. For any brand marketing to them, there has to be a finger on the pulse at all times.

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Time to move on.

Dear reader,

I have today resigned from Blyk , a company I co-founded late in 2005. My time in Blyk has been very successful and exciting, but now is the right time for me to move on.

Social media and rapidly developing mobile services combined create totally new markets for media, brands, operators, service providers and e-business as a whole. I want to explore this new emerging opportunity further.

The future of internet is mobile, said Google. Many other major companies have banked their hopes on mobile. And they have done so for a good reason. Nearly 3 out of 4 humans on this planet have a mobile phone, and the number is growing. And at the same time the computing powers of mobile phones are exploding. What a smartphone was 4-5 years ago, any feature phone today most likely exceeds it. The new Nokia dual SIM C2 retailing around 2700 rupees ($50) in India connects you to Facebook, Orkut, Twitter, Google, internet, has email, music player, radio, camera…well, you get the picture.

At the same time more operators are moving into All-IP network structures reducing complexity and enabling a much faster adoption of new services and solutions.

Our social behaviour fuelled by social network sites has created social media frenzy and media landscape is changing faster than ever. Earned & owned and not just bought media exposures change the way brands communicate with their audience. And now all this will be powered with mobility opening a completely new chapter in media business. Mobile internet statistics from US (already over a year ago) confirmed that majority of the traffic went to social networks. And it has only increased since.

And mobile is much more than just internet on mobile. Deals, coupons and other m-commerce solutions are finally breaking through and my prediction is that they will eventually create the biggest marketplace in the world. After all, mobile is your personal connector to the world and commercial solutions have just been waiting the right moment and maturity.

Mobile as a medium is coming to age, and as said many times by the great mobile expert Tomi Ahonen, it is the 7th mass medium. Although media buying and planning in mobile is a complex task given the vastness of the market and diversity of the players in mobile, brands have realized the importance of establishing solid strategy and execution for mobile media. At its best, it can become the ultimate tool for loyalty creation for brands, services and operators. It is instantaneous and interactive, something extremely important when fighting for loyalty.

Mobile is personal, direct, interactive and always-on channel to 75% of the worlds’ population. That’s an incredible opportunity to communicate and do business with the entire world.

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Happy Birthday to us!

It’s time to pop the bubbly—Blyk turns 1 in India! Time sure flies when you’re having fun. And the year gone by has been nothing if not fun. From launching our services to having a subscriber base of 1.68 million opt-in profile members, the journey has been extremely thrilling.

Take a moment to absorb that number: 1,680,000 young (16 to 29 years old) people in India have voluntarily chosen Blyk and given it permission to send them marketing messages from the brands we have tied up with.

Since they have voluntarily given permission to be contacted and have shared their basic information, it makes for a very potent mix for advertisers. Our formula is simple: Basic Targeting + Behavioural Targeting (based on responses) = Relevant Content + Relevant Ads. The result—an impressive 25 percent response rate.

For the consumers, it is a no-fuss service where they get to enjoy deals, information and more in the areas they want—and only in the areas they want. At a time when SMS spam is driving people up the wall, here is a service that only sends them relevant information that they asked for. It never crosses the line between permission-based marketing and spam. Never. And this is why we are able to add 3500-4000 members every day.

In the one year of our existence in India, we have acquired deep insights into the mind of the Indian youth. We have been able to bridge brands with their consumers and built a successful three-way relationship.

In the coming years, I have no doubt we will increase our subscriber base and our client base exponentially. Our ambition, however, is to continue to enhance the user experience—both for the consumers and for the brands. Cheers!

Posted in Indian Youth, marketing, mobile advertising, social media | 1 Comment

Ask nicely, and I will

The title doesn’t refer to my willingness to please. In fact, it refers to people who are the most difficult to please—consumers. In my last post, I talked about a study brought out by the Mobile Marketing Association (MMA) on permission-based mobile marketing. The premise it works on is that if you get a buy-in from consumers, your marketing efforts can become more targeted and yield higher return on investment.

The study says that permission based mobile marketing helps marketers in a big way by helping them send out focused messaging to only those consumers who would be more interested in that message. It helps them break away from the clutter and avoid sending out spam-like broad-based messages that ultimately don’t result in much value against the advertising investment.

Over time, this becomes a much richer way of segmenting customer bases, offering even more value to consumers and producing a better return on investment. Because you are asking the consumers for their preferences, the likelihood on them responding to the target message is higher.

It also helps create a more long-term, engaging relationship between a brand and its consumers. The intangible benefit that brands and marketers draw from this is that consumers are also more likely to trust a brand or service that values them. This develops into a more sustained engagement, rather than a one-off interaction. And over time, this engagement makes for brand loyalists and ultimately ambassadors for the brand.

Relationships based on mutual respect and trust last the longest. With permission based mobile marketing, brands can develop exactly this kind of relationship.

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With your permission

If I asked you nicely and gave you deals, discounts and gifts against things you wanted to buy anyway, would you allow me to share my marketing message with you? That is the premise that permission-based mobile marketing works on. It is marketing that has a buy-in from the target audience. It is not just about transactions, but about building a dialog between the consumer and the brand.

The Mobile Marketing Association (MMA) recently came out with a white paper detailing case studies from around the world on permission-based mobile marketing. Supplied by the MMA Task Force, of which Blyk was a part, the case studies illustrate what I have long held—if you get a consumer buy-in with customised and targeted marketing, instead of blind mass-dissemination, you have a consumer for life.

The basic premise of permission-based mobile marketing is simple—it is about value exchange. It is a tacit agreement between the consumer and the brand. In exchange for their contact information and personal preferences, consumers expect the brand to respect their privacy even as it offers them value in tangibles like coupons, offers, deals, samples, or intangibles like apps and content.

It is essentially a four-step process. You start with giving the consumers the chance (and, of course, a compelling reason) to opt in. When they do, we can create a database of their preferences, which are then shared with the brands. The preference profiles are kept updated so that the engagement remains relevant for the both, the consumer and the brand.

For the brand, the benefit is the potential of a long-term relationship and compelling engagement with the consumer. And we all know that translates into higher return on investment. For the mobile networks, it is a chance to increase customer satisfaction and stand out among their peers with compelling content.

The study also illustrated that this type of marketing is best suited for a device as personal as the mobile phone. It is a device that offers the best one-to-one platform for interaction, giving the consumer personalized content and services.

Even though it is new in India, permission-based mobile marketing is already beginning to take off. After all, gives Indian consumers what they’ve never had—a break from being treated by marketers as just a huge mass.

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Group buying is ready for mobile and social networking

Ever tried bargaining for something by promising the shopkeeper you’ll buy more if you get the right price? We all do it. And the discount we get by doing that is usually 2-5 percent, 10 at the most. Now if you get your friends also in the picture, that percentage notches up slightly more. What if you brought in the promise of 10 or more buyers? The shopkeeper becomes more pliant and the discount goes up to 15-20 percent.

This is the concept behind group buying—a concept that saw a big surge in India last year. Several group buying portals sprung up, offering unbelievable deals on everything, from gadgets to designer-wear, restaurants to spas, cruises to movies, and more. The way it works is that the portal ties up with the retailer and promises to pull in a certain minimum number of buyers for a particular product or service. If the minimum number is achieved, the deal kicks in. If not, it doesn’t.

Globally, group buying has been around for the last few years, with players like Groupon and Living Social growing meteorically. It took some time for the model to be evolved and its chinks to be ironed out in the US and Europe. The Indian players, consequently, have it a little easier, since they’ve recently entered the fray.

The biggest factor in making group buying successful is that it makes these deals available where you are. The idea is that if you are getting a discount for a spa treatment, you would want the spa to be close to where you are. And this is where group buying on mobile can help. Combine group buying with location based services and you have a killer model. Imagine you are in another part of town and your mobile tells you there is a group deal in the works for a restaurant there.

The other important factor is getting the number of people signed up to make the deal you want active. And social networks have started to play a big role here. Share a deal on your personal network, get your friends to join the fray, and the deal is yours. The more the number of people following you or networked, the better the chances of your deal. And since the social networks are available on mobile and are adding location mapping to their list of features, you get location, mobile, social numbers, all at once. At least that’s how it should work theoretically. But it needs to be tested out more intensively in practice. And the Indian group buying sites could take advantage of the high mobile penetration as well as social networking numbers.

The market awaits, are you ready?

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App in your language?

There is a huge comfort in speaking, reading and writing in your own language. However, the Internet, at least in India, has largely been a bastion of English language. Of course, there have been some remarkable examples of sites in regional languages, but there is still a long distance for these languages to cover on the net.

On the mobile, in terms of both SMS-based VAS as well as apps, the story is similar. In a country with 22 constitutionally approved languages, there is not one app or service like, say, China’s Baidu. The diversity of cultures in this case dilutes the numbers.

There are enough studies to suggest that regional mobile content market is not something to be ignored. For instance, Internet and Mobile Association of India (IAMAI) and market research firm IMRB International have come out with a study that says there is a huge demand for regional content.

With mobile penetration higher than broadband penetration, the mobile is being increasingly seen as the medium to reach out to the Next Billion. The mobile networks have a huge potential to drive governance services in the area of education, healthcare and public information systems to those who need them.

The problem so far has been the lack of a truly convincing business model. Advertising is hard to sell for regional content. The Indian love for the movies, though, is one sure-shot direction to look for advertising revenue—promotional content for Bollywood or Tollywood or any of the regional movies.

But will that be enough to make investing in regional mobile content a viable option? I wonder.

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Time to shed the conservative garb

Even though the Indian market is dominated by the traditional forms of media, namely print and television, there is a lot of buzz around the digital medium. And this has been the case for some time now. Companies often talk about how digital is a key component of their marketing strategy and they see more monies being spent on it in future. If one goes purely by overall statistics, the medium does not look very appealing as a vehicle to reach out to larger audiences. There are around 12 million people with a broadband connection, compared to roughly 100 million in neighbourhood China. But when one looks at the socio-economic and demographic profile of the internet user in India, it becomes a compelling medium for the advertiser. And with the advent of 3G and a huge mobile subscriber base, more and more people will be surfing the web through their handsets. Going by this, one would assume that internet advertising will already be significant in India, if not substantial, and definitely grow rapidly in the future. But when one looks at the numbers shared in various reports, they seem to be on the conservative side.

Recently, the consultancy firm, PricewaterhouseCoopers, released its global outlook for the Entertainment and Media industry (2010-15) which spoke of the next five years being the “golden age of empowered consumers”. It also pointed towards an increase in demand for digital by consumers all over the world. In India, internet advertising will be growing the fastest among all mediums with a CAGR of 25.5 per cent. But again, when one looks at the numbers for the size of internet advertising in India, it looks conservative. I think the medium will be attracting much more advertising monies in the next five years than the current estimate of Rs. 24 billion.

Part of this conservatism stems from a lack of standard measurement tools to measure the reach and impact of digital media campaigns. Majority of media planners are comfortable with traditional media, for not only it is huge, but also there are standard measurement tools which give quite a detailed picture. You might argue, how representative they are or how much do they reflect the ground realities, but they are accepted by the industry. When it comes to the digital world, there is no such tool. People call for developing standards but somehow I feel that it cannot be created by forming committees of experts. When Google started its search engine services, it came up with its own advertising measurement tools and they became the standard. Likewise, there will be digital companies who will be able to develop a tool through which the advertiser will be able to measure the impact till the last dollar spent. So while committees are good, I think the digital world will itself churn out a solution.

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What’s clogging the pipes?

The usage of apps on mobile devices is rising across the world. People are increasingly connecting to the internet through them. That only means one thing—clogged bandwidth pipes.

A study by mobile analytics firm Flurry came up with this interesting statistic about the US market: In June 2011, the average US mobile user spent 81 minutes a day using apps—compare that with 43 minutes in June 2010! Also compare that with 74 minutes spent by desktop and mobile web usage!

A lot of these apps, given their popularity, are also becoming vehicles for ads. These ads take up further bandwidth. Take the great Angry Birds, for instance. According to one report by Nokia Siemens Networks ‘ Smart Labs (NSN), on an Android-based Samsung Galaxy smartphone, with mobile advertising, Angry Birds generated 2,422 signals in one hour of play, which is huge! They have said they are fixing the issue, but this just illustrates the future and some challenges networks will face.

The question we need to ask is, who is making money from this huge amount of bandwidth usage? The app? To some extent. The telecom operator? Who knows! And there lies the big problem. Operators need to figure out some way to earn out of this. Otherwise, all they will be left with are clogged pipes and consequently a label of poor bandwidth availability on their service record.

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