ngpay

Mall on Mobile

Team Members

Arjit Jain(9) Rajesh N(29) Vimal S(32) Vinit Singh(57)

9/6/2010
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Executive Summary:

A Marketing Plan is the bible of the marketing activities for a product. It provides a comprehensive
description of the activities and rationale behind targeting segmenting and positioning the product in
the market.

This report presents a Marketing plan for NGPay, the market leader in providing M-commerce solutions.
M-Commerce is still in nascent stage in the country. But, the growing number of mobile GPRS users
makes it a hot property. The report aims at creating Brand NGPay and increasing the M-Commerce
usage on a whole. Though not mentioned specifically, the promotion of M-Commerce takes place with
all activities and strategies suggested.

The report begins with the situational analysis of the M-commerce sector in the country. NGPay is then
analyzed and the important characteristics of the same are identified by using SWOT analysis. It is
followed by defining the target market for the offerings.

The following section describes the market mix of NGPay. Strategies are suggested to increase the
presence of NGPay and improve its penetration in the Indian market. Building of Brand NGPay is based
on the BRANDZ brand equity model and the marketing strategies are formulated accordingly.

A simple but accurate model for tracking the progress of promotional activities and implementation of
marketing strategies is described, which is followed by conclusion.
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Table of Contents
1.1 Situation Analysis ................................................................................................1
1.1.1 ngpay’s advantages..........................................................................................2
1.1.2 Target Market................................................................................................2
1.1.3 Competitors ..................................................................................................4
1.2 SWOT analysis for ngpay.........................................................................................4
1.2.1 Strengths......................................................................................................4
1.2.2 Weaknesses...................................................................................................4
1.2.3 Opportunity...................................................................................................5
1.2.4 Threats........................................................................................................6
1.3 Market Size.........................................................................................................6
1.4 Segmentation......................................................................................................7
1.4.1 Geographic Segmentation..................................................................................7
1.4.2 Demographic Segmentation..............................................................................11
1.4.3 Psychographic Segments..................................................................................11
1.5 Positioning of the product.....................................................................................11

1.6 Marketing Mix....................................................................................................12

1.6.1 Product ......................................................................................................12

1.6.2 Price..........................................................................................................13
1.6.3 Promotion....................................................................................................14
1.7 Monitoring mechanism..........................................................................................16

1.8 Conclusion.........................................................................................................17
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1.1 Situation Analysis:

ngpay is an M-commerce application provider which gives you the convenience of shopping from your
mobile. It gives you the option to choose from 100+ stores to shop, send gifts, buy books & movie
tickets, book all travel tickets and more – easily and securely from your mobile handset. ngpay provides
end-to-end, financial-grade security that has been independently certified by leading Banks and
Software Security firms. ngpay has been thoroughly tested and deployed at scale across India by HDFC
Bank. ngpay is 100% complaint with RBI guidelines. It has also been chosen as the technological M-
commerce partner of Axis Bank. ngpay continues to tie up with more Partners as requested by its users
on their mobile phones.

1.1.1 ngpay’s advantages:

 Brand Neutral

Unlike most of its competitors it has a

 Superior technology

 Variety of tie ups with vendor partners across areas like entertainment, travel and shopping.

 Tie up with two leading banks of India: HDFC and Axis Bank which gives it an edge over others
in mobile banking.

1.1.2 Target Market:

The target market includes all those wireless subscribers who use GPRS regularly.

How did we arrive at these statistics?

Available data: Vitalanalytics,a market research company that observes, analyses and reports on
customer's behavioral and attitudinal patterns in the mobile space reported that in Feb 2009, 16mn
people used internet using GPRS regularly and the total wireless subscribers were about 375mn.

This shows that a ratio of 4.26% of wireless subscribers used GPRS services. Applying the same ratio on
the number of wireless subscribers

We estimate that around 50% of this segment uses M-commerce.

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1.1.3 Competitors:

• Paymate

• ITZ Cash and NoQ24*7

• mchek
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1.2 SWOT analysis for ngpay:

1.2.1 Strengths:

1. Tie ups with varied vendor base-

ngpay offers multiple solutions on single platform. It offers solutions related to traveling,
finance, shopping and entertainment on the same platform. It has tie-ups with more than 100 store
which enables users to buy movie tickets, book tickets for train or plane, do shopping through mobile
and provides mobile banking solutions.

2. Low cost-

ngpay offers one of the cheapest m-commerce solutions. No premium is charged while shopping
and purchasing tickets. The average cost of operation through ngpay comes around 50 paise (sources
ngpay.com) which is a lot cheaper than conventional solutions like m-commerce through SMSs or
competitors like M-Check and Paymate.

3. Easily accessible-

ngpay works through the Java based mobile software. This software can function on all types of
handsets which support GPRS web access. It can be downloaded free of charge unlike the competitors
M-Check and Suvidha.

4. Innovative-
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ngpay has the First mover benefit in the segments in which it operates.

1.2.2 Weaknesses:

1. Lack of penetration:

According to market size study already mentioned earlier in the report, penetration of ngpay
has been weak.

2. No Brand image:

ngpay does not have any brand image associated at present. It is the same for competitors.

1.2.3 Opportunity:

1. Rural Market:

The huge potential of the Rural India is waiting to be explored. A strong Brand associated with
ngpay can help the M-commerce leaders to tap in this market. M-banking model has worked across
poorer countries than India such as Vietnam, Cambodia and Kenya.[25% of Kenyans use m-commerce
today.]

2. M-banking:

ngpay has associations with HDFC and AXIS bank for their mobile banking solutions. Recently
Reserve Bank of India has permitted another 32 banks to launch their own M-banking solutions. ngpay
can associate with such banks to offer m-banking solutions to these banks like it is doing to HDFC and
AXIS bank.

3. Job seekers:
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Increasing population has resulted in increased numbers of unemployment in the country.

According to a survey by VitalAnalytics, 43% of GPRS users surf job related information (Appendix 2).
www.freshersworld.com along with many other websites is serving to the needs of such job seekers.
They usually provide mobile solutions through SMSs which is a static approach. ngpay can associate
itself with www.freshersworld.com to provide required information to job seekers. In the process
ngpay can increase its user base manifolds.

4. Advent of 3G in India:

Indian mobile scenario will change with the 3rd generation mobile services. This will bring down
the overall cost of mobile internet and increase the ease of use.

1.2.4 Threats:

1. Security related concerns:

The biggest constraint is the lack of trust in the minds of the consumers. M-commerce is in a nascent
stage and the masses are still apprehensive about using mobile as a platform for monetary activities.

2. Entry of new m-commerce solutions:

M-commerce is gaining foothold in the country at a fast rate which has resulted in increasing m-
commerce software like Suvidha etc.

Objectives
One of the main problems identified is Trust deficit and lack of awareness about the offerings. The
main objective of the marketing plan is to bridge this trust deficit through Brand building exercise
and increase awareness about ngpay and its offerings.

1.2.4.1 General Objective

• To increase the awareness about brand ngpay as secure and convenient M-commerce solution
provider.

1.2.4.2 Organizational Objective

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• To direct efforts at increasing the m-commerce market by way of more grand tie-ups with
the entire ecosystem of content developers, banks & financial institutions, telecom providers and
the media.
• To increase the market share of ngpay. t more users by increasing the number of solutions
making the product innovative and unique.

1.2.4.3 Marketing Objectives

• Increase the share of ngpay in the existing market of 7.47mn from 0.7mn to 1.4mn in a year by
coming up with innovative solutions to customer’s problems.
• To create a market for brand ngpay by marketing rigorously in unexplored/slightly explored
regions.

1.2.4.4 Communication Objectives

• To increase knowledge of the diverse user base which include rural population, college
going students and job seekers.
• To communicate the security aspect of ngpay and bridge the trust deficit by leveraging the
Brand Image.

1.3 Market Size

Total size of the market is the number of wireless subscribers who access Internet on mobile:

• Almost 63 million urban Indians accessed Internet using their phone in February, 2009.

• 16 million urban Indians access Internet on their phone almost on a daily basis.

• This data was taken at a time when the total wireless subscriber base was 375mn. Since the
market has grown to 584mn today, hence we have roughly estimated the following:

• Total number of urban Indians accessing Internet using their phone must be around 98 million.

• Total number of Urban Indians who access Internet on their phone almost on a daily basis must
be around 24.9 million.

1.4 Segmentation

1.4.1 Geographic Segmentation:

a) State wise Segmentation

We see that states with highest number of wireless subscribers also have the highest number of
broadband subscribers and hence there seems to be a relationship. So, the states where wireless
subscribers are very high and even broadband penetration is high must be selected as those with higher
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potential for growth for ngpay because there is higher probability that these people subscribe to M-
commerce if we market themselves to them.

The figure shows that Maharashtra and Tamil Nadu show high wireless and broadband subscribers. So
we should target these markets effectively.
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b) Urban, Semi Urban and Rural:

Urban: Urban people have high tele-density

Sub Urban: There is a higher tele-density and there is great need for accessing local services.

Rural: A lower tele density but it is growing at 71%.

Urban+Sub Urban wireless subscriber market is 393mn and Rural wireless subscriber market is 190mn.

Further, Rural areas can be better divided into socio-economic classification.

Socio Economic Classification is done on 2 variables namely main occupation of the wage earner and
the type of house they live in. Under this we have 4 classes, R1,R2,R3,R4.

SEC Classification
Rural %age of people under classification
R1 2.6
R2 8.0
R3 26.7
R4 34.3
Sub Total 71.6
Urban 28.4
Total 100

SEC R1: Landlord farmers,educated, exposed to urban environment with their children studying in
nearby towns,exhibit a lifestyle closer to urban areas,adopt modern technology , own consumer
durable products such as tractors ,refrigerators and two-wheelers. This segment is 2.6% of rural
market. Hence we can estimate it to be 4.96mn

SEC-R2: Rich farmers with about 5 acres of land may not be educated but want their chioldren to be
educated, aspire to have social status, own some of the consumer durable products like television,
tractors and two-wheelers.This segment is 8% of the rural market and hence its estimated to be 15.2mn

Since these 2 rural segments emulate the urban industry in their needs and aspirations, hence we can
add these 2 segments as well. We have an additional unrealized market around 20mn
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1.4.2 Demographic Segmentation:

Occupation based:
• Students: There is a large student segment.

• Working Professionals.

1.4.3 Psychographic Segments:

In psychographic segmentation, buyers are divided into different groups on the basis of
psychological /personality traits, lifestyle or values. We have identified 3 psychographic segments
which we can cater to.

• Innovators and Experiencers

Our innovative ideas which focus on solving some of the customer’s problems and thus
attracting them are targeted at these segments.

• Thinkers

The benefits of our offering of our products would be emphasized to this segment.

1.5 Positioning of the product

Target market: All potential users of m-commerce (i.e. all GPRS1 users)

Frame of reference: m-commerce application

POP:

• Safe & Secure

POD:

• Myriad number of vendor partners enabling higher transaction throughput.

• Innovative solutions to customer’s problems while enabling m-commerce.

• Ubiquitous, not hard tied with any particular telecom provider.

Reasons to believe:

• We have become the largest m-commerce partner of irctc in a short span of time.

• Our partners across banks and business institutions have instilled faith in our security and
our product. Many of them have chosen us as their technological partner because of our
neutrality.(we don’t belong to any telecom company)

1
GPRS stands for General Packet Radio Service. It is a medium to access internet on the mobile phone
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New positioning statement:

Among the GPRS users, ngpay is an m-commerce application which provides a safe and highly
convenient platform for the user to shop and get innovative and customized information because of our
multiple tie-ups with variety of vendor partners and our brand neutrality to any telecom provider.

Perceptual Map:

1.6 Marketing Mix:

1.6.1 Product:
Product innovation is an effective way of targeting new users. It is also an important step in the Brand
building process. ngpay can innovate its offering in the following ways:

Rural Markets:

Associating with E-Choupal:

Entering the rural market is the biggest challenge. Rural users are apprehensive and cost conscious.
Therefore, associating with a brand with strong hold in the rural market will help ngpay in breaking the
ice to enter the rural India. E-choupal is one such brand. E-choupal will benefit by giving information
through ngpay and users can get direct information from E-choupal on their mobiles. Transactions
through mobiles is a win-win situation for all the 3 parties involved.
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Urban Markets:
Customer Intelligence leading to Customized solutions:

Only those Local Deals that you want-

SMS’s providing information on localized shopping deals etc. has been irritating consumers for some
time now. Although information on good deals is desirable but consumers would prefer if they are
recipient of customized information, i.e. of deals which are useful to them. Hence ngpay can employ
some customer intelligence, use the current transaction tracking to create buying patterns and then
provide customized information to each user. e.g. if a person buys a book selected from a bookstore on
his mobile, the deals section of the ngpay application should reflect deals on books first and then the
others. Hence the customer is more likely to visit ngpay for checking his favourite deals and there is
higher probability that this kind of mobile based window shopping will increase m-commerce on
ngpay.

Only those jobs that you want-

We can also tie up with job based websites and provide customized job related information through
ngpay. As a result we try to delve into a larger sector and market ourselves by increasing our
awareness. The end result is only publicity and more user subscriptions to ngpay. According to a study
by VitalAnalytics, 43% of GPRS users in India search job related information. ngpay can club with
content developers such as www.freshersworld.com wherein the applicant need not search through the
job codes but he gets only those job alerts on his ngpay application that he wants. The idea is to use
this platform to increase the awareness among typical GPRS users with ngpay by providing customized
information.

Localized Shopping-

Many a times, a person’s daily chore is to buy fast moving consumer goods from nearby retail outlets
like Reliance Fresh or More or Vishal Retail or Smart Hypermart etc. based on the locality. ngpay can
register with such retail outlets. The customer can now use ngpay to select the choice of products and
buy them on our application. These will be home delivered to him directly. Even though some of the
consumers already do this on phone because of their contact with the retail outlet but ngpay provides
the consumer an option to select the choice of goods and then buy them rather than remembering the
names of the products in earlier way.

Liaison between the consumer group and vendor partners-

Many a times a vendor offers group discounts to a set of people e.g. corporate user group offers given
by telecom providers at IT parks wherein the vendor gives better offers because he gets a larger
customer base. ngpay can also promote itself by bringing up such a Corporate User Group offers for
employees of IT parks wherein it brings the employees of the IT park together for their shopping needs
and the vendor partner gives an offer to them because of the larger customer base he is able to get
now.

Tie-ups with more number of PSU banks-

Consumers prefer transactions through their own banks rather than using credit cards or visa services
to transact over other banks.

Western Union Mobile Transfer-

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ngpay can try to secure the approval from Western Union in order to cater to the needs of other
service providers; since ngpay platform is independent of the mobile operator. Western Union’s money
transfer system has a global agent network of more than 350,000 locations in over 200 countries and
territories. Adding western Union would mean a larger customer base for ngpay.

This has been done by Airtel mchek already.

1.6.2 Price:

The following are the ways in which ngpay can generate revenue:

• It charges a nominal convenience fee for the transactions done.

Eg: Booking a train ticket / movie ticket will attract a convenience fee of 2% which the user
might end up paying even in case of an online transaction

• ngpay can tie up with various vendors and charge a monthly fee upfront for allowing the users
to use the ngpay platform to purchase goods from the vendor.

• ngpay can generate revenue from the advertisements that it shows inside the application
during the transactions

• ngpay can charge a premium amount from those stores which want them to be listed under the
preferred stores category.

1.6.3 Promotion:

The plan mentions promotional activities for a time period of 1 year. Some activities are periodic and
will not last throughout the year. Promotion activities will revolve around building Brand ngpay, as well
as, stressing the fact that M-commerce using ngpay is totally safe for monetary transactions. ngpay has
been certified from Reserve Bank of India and this fact will be stressed in the promotional events.

1. Targeting college students:

College students are one of the biggest source of innovator customers. They are ready to try
new and upcoming technological advancement. M-commerce is an apt solution to a lot of their
problems.

• ngpay can capture this huge customer base in the college events and activities. ngpay
can be co-sponsor of annual cultural and technical festivals organized in various
varsities around the country. Being a sponsor ngpay will organize “ngpay- Mall on
mobile events” in these festivals. This event is aimed at spreading awareness about
ngpay and creating the trust between the consumers and ngpay for M-commerce. The
events aim to make all the participants of these events an advertiser. The software can
be uploaded in the cell phones at these events and based on some criterions freebies
like Mobile cover, caps and key rings. This activity is aimed at creating a Buzz around
the brand ngpay. The product innovation of ngpay must be highlighted in these events
and for experts of previous users can be presented to stress on delivering performance.
A list of such events is attached at the end.
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• Advertising in Barista on contractual basis. Barista is a popular coffee chain with pan
India presence. It also shares the Orange colour of ngpay which makes it synonymous
with the Brand ngpay. Promotion period will last for a month and will involve barista
acting as information distributing centers for ngpay. The focus would again be on
highlighting the security features as well as the wide variety of solutions offered by
ngpay.

2. Targeting Rural customers:

Rural India offers an untapped market. But unlike the college students, the rural customers are
apprehensive about new products and offerings. That is why direct marketing is not done in
this segment. The focus is on building tie-ups with E-choupal and other microfinance services.
Apart from the RBI certification, the strategy is to utilize the trust the consumers on the
associated brand. E-choupal has wide penetration in rural penetration but it lacks depth.
Providing solutions through ngpay will enable E-choupal penetrate in all parts in rural India.
ngpay can benefit by developing new range of offering for E-choupal and earning commissions
on purchases of agriculture related products. It is highly cost effective promotion plan. Local E-
choupal centers along with rural relationship development through agencies like
www.ruralrelations.com, will conduct periodic workshops in the villages to explain the
functioning of the M-commerce platform and benefits of the usage.

3. Targeting Job seekers:

Job seekers are not perceived as an active market, but a dormant market. Several job search
engines provide solutions on mobile through SMSs. This is a costly deal is not interactive. ngpay
can associate with www.freshersworld.com as mentioned in the product innovation part. The
websites can give information on ngpay. To access this database, the users must use ngpay.
Different users can use ngpay for different solutions as ngpay offers the largest number of
solutions. The salient point of this approach is that the market is not related to geographical
boundaries.

4. Targeting working population in metropolitan cities:

Another set of innovative customer is the population working in major cities in different parts
of country. These customers depend on internet to solve a lot of shopping requirements. M-
commerce makes it even more convenient. The task at hand is to make ngpay visible
everywhere in these cities. This can be done in the following ways:

• Using Auto rickshaws for visibility:

The idea of mobile advertisement is new and extremely effective. Auto rickshaws
travel everywhere and help in creating visibility for the brand as it is one of the most
efficient means of public transport. The vehicle is to be evangelized in the Orange
avatar of ngpay. A table containing the number of auto rickshaws with the list of cities
and numbers is mentioned.
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Number of Number
Auto of Auto
S.No. City Rickshaw S.No. City Rickshaw
1 New Delhi 200 5 Hyderabad 100
2 Mumbai 200 6 Pune 100
3 Chennai 100 7 Banglore 100
4 Kolkata 100 8 Ahmedabad 100
Total 600
• Tie up with Upcoming service provider:

ngpay will collaborate with Upcoming teleservice provider like Uninor and Tata Docomo
to gain access to their user base. In the process the awareness of the users regarding
GPRS and M-commerce shall increase. Thus, it will result in more usage of Value Added
Services (VAS). The service provider will see an increase in revenues and ngpay will get
exclusive access to the user base. To achieve this target the service provider will give
ngpay as a free download to the users. To access the service the user has to activate
the GPRS facility on the mobile.

5. Online Social Marketing:

Online social marketing on websites like Facebook, Twitter and LinedIn is the new and an
effective way of targeting prospective customers. All information about ngpay and its offerings
can be made available on these websites. The target is the tech savvy user who is already
familiar with E-Commerce as well. The aim is to shift the user from E-commerce to M-
commerce.

6. Promoting in Localized shopping outlets:

ngpay can use the extensive network of the localized shopping outlets as a platform for
increasing awareness. The focus will be on increasing awareness about ngpay in Tier 2 and Tier
3 cities and creating Brand ngpay. This can be done by distributing pamphlets in these stores.
Such stores are to be identified and promotional pamphlets are to be distributed for a time
period of 2 weeks in one store. This is done based on the findings that consumers usually
purchase stocks for 2 weeks. Thus, this will ensure maximum target audience.

Calculation of Promotion costs:

Total Budget = 35 lac rupees

1. Mall on Mobile events in college festivals:

1.1 Average Cost of co-sponsoring one event = 1.5 lac rupees.

Total number of events sponsored = 10

Total cost of sponsoring events = 15 lac rupees

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1.2 Cost of distributing freebies:

Freebies distributed = 300 per event

Average cost of a freebies = 30 rupees per unit

Total cost of distributing freebies = 90000 rupees

2. Advertising in Rural areas through Rural relationship management agency:

One time contract shall be given to www.ruralrelations.com (Cost of contract

depends on the extent of the contract and regions to be covered).

For example, cost for conducting relationship sessions at 15 centers with 1 session
per week and 14 sessions per months for a time period of 2 months = 10 lac rupees.

3. Advertising through Auto rickshaws in cities:

Cost of converting one auto rickshaw = 500 rupees

Total number of auto rickshaw employed = 1000

Total cost = 5 lac rupees

4. Advertising in Barista coffee shops:

Associating with the Barista = 3 lac rupees

5. Cost of printing pamphlets:

Cost of printing one pamphlet = 0.5 rupees

Total pamphlets to be distributed = 2 lac numbers

Total cost = 1 lac rupees

All other forms of advertisements and promotion do not require any monetary expenditure. Currently
we have utilized 34.9 lac rupees of the budget.

1.7 Monitoring mechanism:

An effective marketing plan must involve robust and holistic monitoring mechanism to check the
effectiveness of the promotion activities. The effectiveness of this campaign will be checked by
checking the number of downloads of the software on weekly and monthly basis. The location of the
new users will be stored to check for effectiveness geographically.

The promotional activities can be accordingly controlled, stopped or modified to obtain desired results.

1.8 Conclusion:
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M-Commerce in India is still nascent. ngpay is already the leader in the segment. But the segment is
seeing entry of a large number of similar products. Catching the segment fast and early is the key.
Threat of entrance of bigger brands can be effectively countered by building Brand ngpay and
expanding the service base of the application extensively. Rural market is bright prospect but it would
be difficult nut to crack. Prudently analyzing the situation and needs of this market is the key. Focus
should also be on promoting M-Commerce with the promotion of ngpay. This will ensure that Brand
ngpay becomes LoveMark in the segment. The initial objective of