The Government of India is aiming to create a trillion-dollar economy through its ‘Digital India’ initiative. In the next two to three years, India will have 850 million internet users and 90% smartphone penetration. Eyeing the unending opportunities, online marketplace OLX feels the time is ripe for disruption.
For OLX, currently operating in 45 countries, India is among the top two growth markets. With 50 million users in the Indian subcontinent, OLX India comprises a key chunk of the global user base.
The Naspers-owned company recently assigned its digital media duties to iProspect.
In an exclusive interview with BestMediaInfo.com, Sapna Arora - the newly appointed Chief Marketing Officer (CMO) at OLX India - talks about how ‘Bech de’ - an iconic campaign from OLX - made the brand a household name across India and what the brand has to offer to the millennials.
OLX is one of the most popular e-comm platforms in India. What challenges you look forward to in such a volatile virtual market?
The most difficult phase is over. When OLX was launched in India as a mobile-first platform, the first challenge at hand was to remove the stigma of used goods in the Indian context.
However, we have only scratched the surface. The bigger opportunity now is penetration from a business standpoint. With growing exposure over the past decade, rising inflation, innovations in technology, and the eco-system becoming more organised and transparent, the pre-owned market in India is at a bright spot currently.
From a technology standpoint, the sky's the limit to offer more services that enable users to buy or sell super easily and upgrade their lives. We are focusing more on the ‘Vs’ now — voice, video and vernacular. Indeed, this will be a very interesting time where we will witness a lot of innovations globally at OLX. The real deal is to get more and more users to see the possibilities that OLX has to offer.
Is OLX planning to branch out with some need-based offerings to customers?
We focus a lot on understanding our TG. In the past, whenever the brand felt the need to diversify, it did. And we will continue to do so if an opportunity arises. The launch of ‘OLX Cash My Car’ in November 2018, and the acquisition of ‘Aasaanjobs.com’ in January this year, are examples of how we, at different situations, found out that there is a set of users seeking beyond what is being offered currently. Our core focus is on users. If we are able to offer better solutions to upgrading their everyday lives, we will diversify.
For marketers, millennial is the biggest TG. But according to you, which demography will drive growth for OLX in this financial year?
In India, millennials constitute about 34% of the population and this number is expected to grow over 50% in the next couple of years. They constitute 47% of the working population, have more disposable income and are keen to spend.
At OLX, millennials remain the key target audience and we expect the segment to drive growth this financial year. Our recent re-branding aims to appeal to millennials as it brings a refreshed approach to upgrading their lives by making smart choices. The new colloquial tagline ‘Set hai’ is millennial-centric.
‘Bech de’ was one of the most successful communication pieces from OLX. Would you continue to build further communication on the same proposition? Or do you think a change is required?
‘Bech de’ was an iconic campaign for OLX, which made the brand a household name across India. Today, OLX is synonymous with buying and selling anything online.
Last year, we conducted a brand perception study across our key markets, including India, to try and understand what our consumers think and perceive about us, and the concept of buying and selling pre-owned goods. What came out was the idea of smart choices.
Today, the evolved consumer is looking for smarter choices, be it the new technologies to make the job easier or a new way to do the good old stuff. Therefore, you see new business models such as online food delivery, grocery delivery and online tickets booking getting evolved.
With our new brand identity, launched in March this year with a new tagline ‘Set hai’, and a new visual identity, we have tried to resonate the essence of this insight that was truly appreciated and accepted widely by our users in India. The campaign features OLX’s new philosophy: every stage is momentary — just a milestone in the journey called life and at each stage, people need to make choices. We will continue to innovate and communicate our new brand ethos with similar campaigns.
Is OLX planning to launch voice search (AI-enabled)? At the technological level, what initiatives is the brand taking to provide an immersive experience to its customers?
Our recent rebranding brought along with it a host of new technological innovations with an aim to provide a more holistic, customer-centric and immersive experience to our customers. Backed by improved AI and ML capabilities, users will experience more customised and personalised news feeds. Users will now be able to see posts from different locations and not just posts near them. More filters are introduced while posting so that the content on the website is more credible.
The new platform enables users to report offensive and spam content. In addition, there are real-time security tips for buyers and sellers in the chat experience. With the new voice messaging feature, users can quickly speak to prospective buyers/sellers without leaving the platform or sharing their phone numbers, thereby ensuring better privacy of their personal details. All these improvements signify increased concentration of efforts towards trust and safety of the users coming on the platform.
A transparency ‘Reckoning’ awaits the digital advertising industry. But what’s your strategy to tackle fraudsters who are looking to exploit a system lacking in transparency?
The digital ad industry is a mirror to the real world. Like the world outside, there are some elements that will remain on the lookout to identify loopholes in technology and hit our users hard. According to a study by Juniper, advertisers globally are expected to lose $42 billion of ad spends this year across online, mobile and in-app channels.
From a marketer’s perspective, there also lies a challenge in getting the impressions verified. My strategy for this would be moving to a programmatic form of media-buying and creating more proprietary tools in order to measure ad-efficiency. A laudable step in India has been by industry players Nielsen and BARC, who have taken a step in the right direction in homogenising the measurement of digital ad spends and efficiency tracking.
As a brand, is there anything that holds you back? What marketing and distribution challenges the brand faces today in the Indian market? Are you hopeful of the opportunities that will spur growth in the recent future?
As a consumer internet brand, our growth is directly proportional to adoption and use of the internet. A connected world still largely remains an urban phenomenon. However, the trickle-down effect is making its way to smaller towns, thanks to affordable smartphones and cheaper data. Our growth is directly dependant on the next billion users joining the internet bandwagon and taking to online marketplace to buy/sell anything.
Do you think the rise of cab transportation (Ola and Uber) is also behind the dip in the sales of self-owned vehicles? Also, is there a change in the mindset of potential buyers (30-40 years of age group) with disposable income?
As per our understanding, cab-based transportation is not a reason behind the dip in vehicle ownership. Cab-based transportation is largely an urban phenomenon and in India, owning a car is aspirational in nature. The reason behind the dip in sales of new cars has been due to the rising cost of car ownership owing to multiple economic factors. This has in turn led to a boom in the pre-owned cars market with most of the buyers and sellers being in the age bracket of 30-40. When the economy or the new market underperforms, it leads to a spike in the pre-owned market.
Unlike the new car market, the pre-owned car market has grown over 15% Y-o-Y while pre-owned cars on OLX grew by 20% in 2018. Users are increasingly moving to a new segment in the pre-owned car market called ‘Unboxed Cars’. These are barely used cars that have been owned for less than two years, and are seeing a rapid rise in listings on OLX. Last year, this segment grew 18% on OLX. These cars are affordable and are 30% cheaper compared to their newer counterparts.
From an advertising perspective, do you think the drop in sales would be directly proportional to the ad spends? If yes, will OLX be forced to alter its ad expenditure in the near future?
We do not expect a drop in sales to affect our ad spends since the pre-owned car market is flourishing. In an economic downturn, advertisers tend to spend more money in order to boost consumer spending and consumption. Given the pre-owned car market has not been affected, our ad expenditure will largely remain the same.
In terms of marketing, we believe that the 3 Vs (voice, video and vernacular) will be very critical in marketing to this next set of netizens. As one of the largest consumer internet markets in the world, India will spur more opportunities given the massive untapped user base and rising disposable income.
And why do you think the loyal customer base of OLX will continue its association with the brand? Can we expect OLX to ride the influencer marketing wave?
What we achieved in the last decade is a brand synonymous to the pre-owned goods industry. Thanks to the first-mover advantage, we still command in the industry.
One of the key reasons our users keep engaging with the brand is the value proposition it brings into their lives and the fact that the app works its purpose. With our presence across more than 4,000 cities, the liquidity on OLX is unparalleled. Users can list an item on OLX, sell it within a few hours or days and monetise their unused products lying at home. An average listing gets hundreds of views on OLX and genuine buyers are aplenty on the platform. Users realise that OLX is a one-stop shop due to its unparalleled liquidity, genuine listings and a wide user base of over 50 million users.
We recently began riding the influencer marketing wave when we leveraged the mom blogger community on World Parenting Day on a marketing communication. Our study showed that 55% of Indian parents are endangering the safety of their kids online. The spot on messaging allowed us to partner with leading parenting blogs, influencers and platforms to deliver this messaging to our target audiences. We will continue to experiment with multiple such initiatives in the near future.