<b>Sharat Jain</b>, Founder & President, RechargeItNow

The internet allows things to be instant, quick and convenient. The confluence of these three drives the web; the future is in services not retail. Logistics is a major stumbling block holding back retail. On the other hand, taking off for a services brand is very easy. With a retail brand, customer satisfaction happens outside the store. It's hard to ensure a good experience. Services on the other hand are going to grow much further.

e4m by exchange4media Staff
Updated: May 18, 2011 12:00 AM
<b>Sharat Jain</b>, Founder & President, RechargeItNow

The internet allows things to be instant, quick and convenient. The confluence of these three drives the web; the future is in services not retail. Logistics is a major stumbling block holding back retail. On the other hand, taking off for a services brand is very easy. With a retail brand, customer satisfaction happens outside the store. It's hard to ensure a good experience. Services on the other hand are going to grow much further.

Sharat Jain is the founder and president of India’s leading online recharge company RechargeItNow. Jain also has a wealth of experience in marketing and telecommunications, having earlier been CEO at Dentsu Media, MD Asia South at Teleglobe and Vice President India at the GTS Group. Speaking to Gopal Sathe of exchange4media, Sharat shared his insights in creating a new kind of online business, and how best to grow in the online space.

In conversation with exchange4media’s Gopal Sathe, Jain talks about the tricks of the e-commerce trade...



Q. Most successful internet businesses today are service companies and not online retail. Why is this?

The internet allows things to be instant, quick and convenient. The confluence of these three drives the web; the future is in services not retail. Logistics is a major stumbling block holding back retail. On the other hand, taking off for a services brand is very easy. With a retail brand, customer satisfaction happens outside the store. It's hard to ensure a good experience. Services on the other hand are going to grow much further.

One of the major drivers for e-commerce has been the RBI insistence on secure credit card transactions. Consumers and merchants are both reassured; the fair play has supported growth. The RBI rules helped greatly and made a significant impact on the amount of security fraud.



Q. How have you been marketing the site? What works well for a pure play online brand? The site is optimised for search. We maximise our focus online, with over 40 per cent of our users coming in from organic search. We haven't done too much on marketing spends, focusing instead on making the best possible product, which also helped create partnerships with the operators, who have links to us on their sites. This has been a good initiative and we have also invoked word of mouth, with refer-a-friend incentives. Of course, we use AdWords as well, but only five per cent of our traffic is paid. We haven't launched on the social network yet, but are looking very closely at it, so as to launch in such a way that we are very effective in our messaging. After that we might look at mass media too, but we are taking things one step at a time.

Q. There are ads for brands on your website. Since the core business is recharges, does this present a conflict? Any site which draws traffic (and we see 90,000 visitors daily) is promising to marketers. It's an incremental revenue opportunity for us, and it gives advertisers a targeted ad space for digital, mobile, youth, urban 18-30 year olds, who are also comfortable with online payments. So in this way, it's an extra revenue stream for us, and we also create value for our partners.

Q. What are the big challenges for online companies today? Online payment is still a challenge, even though people have become much more comfortable using it. But it restricts access to products, and in the long term it will become a problem again. Online wallets, prepaid debit cards are the solution for the huge number of unbanked consumers who have no means to pay except for cash. Other than that, the key issues any company must keep in mind are access and comfort, and because of that we feel that the focus should be on mobile, where 3G will be an enabler.

Q. How significant is mobile internet as a medium? Mobile internet has certain issues like a lack of payment gateways. However, we have a WAP portal underway, because we believe that this is going to be a big growth area. The introduction of a one time password will have a positive impact in this area, and as the process becomes simpler, it will also become very popular, very rapidly. For that reason we are also starting to do more things on the handheld device.

Q. How big a niche is servicing mobile customers online? Where does the growth opportunity lie in this area? Today the number of mobile phone users is supposed to be 771 million. About 500 million of these are active users, and around 450 million of that are prepaid users. With two million users registered with us, we have only reached .4 per cent of the total mobile universe. From another perspective, there are around 50 million active net users. From that we make up 4 per cent of the internet universe. So obviously there is a lot of scope for growth today. There is a significant market opportunity, and what we are seeing is that online payments are growing significantly. The opportunity will lie in first maximising the reach within the online audience, and then spreading to a wider market.

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