PowerPoint Presentation

Team 1Soumya Biswal I Shannta Badgett I Rupali Deshpande I Vaidhyaraman S. I Somyata Bhatia I Diluk Perera

Conversational Commerce in India

AgendaBackgroundStrategic challengeStrategic solutionInsights and potential marketStakeholdersTimelineConclusion

BackgroundHuge market potential (1.2 Billion Population)

Fastest growing economy

86% cash transactions

Progressive government

Digital India initiative

The Indian workforce will grow to 900 million strong by 2020compared to the USwhich is the third largest in the worldwith approximately160 million people."India Economy - GDP, Inflation, CPI and Interest Rate."FocusEconomics.N.p.,n.d.Web. 11 May 2016.http://fortune.com/2016/04/08/india-economy/bn

Higher income and education levels, allows for households to use alternative mediums of exchange other than cash. Wherethere ishigherincome and education levels, other mediums of exchange other than cash are used,plastic money (credit, debit and prepaid cards)."SMPTE October 2014 Cover 2."SMPTE Mot.Imag. J SMPTE Motion Imaging Journal123.7 (2014): C2.Reasons and Titles to Using Cash in India. Fletcher, 2014. Web. 2016.Narendra Modihas been the Prime Minister of India since 2014 and has been progressive in his efforts to adopt new technologies and improve digital literacy.

"Bright Outlook."Economic and Political Weekly38.37 (2003): 3860-861. Web. 2016

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Potential Red OceanPartner with Messaging Apps

Build App for merchants

Red Ocean

Looking at the potential solution for the conversational commerce VISA can look out for two main waysPartner with the messaging appsBuild mobile application for use by merchents

Visa has to definitely take one of these paths since there is a threat of competitor to take the business and the whole industry is changing. There is a huge potential that industry will change to a Red Ocean hence the competition has to create a early competitive advantage4

Challenges For AdoptionMindset SecurityAwareness TrustRegulation

Lack of awareness on different digital and easier modes of payments Mindset about cash as a convenience method of payments and obsession about holding cashBank regulations like payment gateways, One Time passwords for authentication makes it difficult for adoptionSecurity is a concern since with plastic money the money and mode of payments is in control of third party (banks)5

Overarching Strategic ChallengeCreate competitive advantage and acquire customers into conversational commerce at a lower cost

The overarching strategic challenges is to how to create a early competitive advantage and acquire customers into conversational commerce at a lower cost 6

Strategic Move Blue Ocean Utility Payments using Conversational Commerce

Electricity Bill Payment through SMS

Visa has to look out for a option of creating a blue ocean strategy to reach out to huge base of people and in the mean time educate people about conversational commerce. Visa can enter utility payment market in India and start with electricity payment as it is the highest market in utility payment. This will create a awareness about conversational commerce and building trust in to people.7

Sample Solution

Insights

Almost 525 million Indian citizens hold bank account making the process easierThere is around 590 million unique mobile users and already the infrastructure is built for sending bill sms for electricity paymentAlmost 100+ villages are getting electrified every week

http://www.thehindu.com/business/Industry/175-million-new-bank-ac-in-india-in-three-years-world-bank/article7109166.ecehttp://data.gov.inhttp://garv.gov.in/dashboard9

No. of people paying for electricity634,798,484 Avg. electricity per family Rs.400No. of families105,799,747Annual revenue for VISARs.1,015,677,574Market Potential

Total electricity payment in India Rs.42,319,898,927Adoption rate 10%Monthly revenue for VISARs.84,639,798Per transaction revenue 2%

http://fletcher.tufts.edu/~/media/Fletcher/Microsites/Cost%20of%20Cash/IBGC%20WP13-01%20Cash%20Outlook%20India.pdf10

Stakeholders

StakeholdersMotivationsActionsImpactAttributesPowerLegitimacyUrgencyCentral/State GovernmentDigitizationCentral initiative, RegulationsAwareness, promotion HighHighHighBanksProfit, TransactionsEnable ChangesEase of transactionLowMediumMediumReserve Bank of India (RBI)Reduce Corruption RegulationsFaster implementationHighHighHighElectricity BoardsEase of operationEstablish process, RelationshipFaster adoptionMediumHighLowConsumersEase of paymentAdoptProfit, Brand imageHighLowLow

The Stakeholders playing key roles in the strategy we proposed are:Central/ State Government :Government is a major stakehlder with high power and high urgency. Themotivation for government is to encourage Digitization in India. This can have a positive impact on Visa's brand promotion and spreading awareness among people.Banks:Banks have a lowpower in this strategy because they have to abide by the government regulations. They are motivated to support this as their will be an increased number of transactions. The increase in transactions will generate more profits for banks.Reserve Bank of India :Reserve Bank of India is a high power and high urgency stakeholder. Their motivation behind supporting this strategy is to reduce corruption by reducing the cash transactions. They can create regulations. This will lead to fasterimplementation of our strategy.Electricity Boards:Electricity board is a medium power stakeholder. They are motivated due to the ease of operation. They canestablish the process and lead to faster implementation of this strategy.Consumers:Consumers are stakeholders with high power. They are motivated to use this for ease of payment. When they adopt this method profits for Visa will increase and create a strong Brand Image.

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20162020

Today20162017201820192020CEO meet Narendra Modi

Pilot Mumbai

Roll out to other metros

Roll out for other utilities

Start Development

Roll out to district headquarters

Expand to other States

Timeline

VISA CEO should meet Narendra Modi and give a very high level briefing of Visas plan (utility bill payment thru conversational commerce) in India and how it can help India and its citizens, with a special emphasis on how it will help in strengthening digital India and will also curb corruption. The message directly from the VISA CEO will show the seriousness of the company at the same time give credibility to the message.

Then both the leaders can pass on the baton to the second rung leaders. The VISA team mostly comprising of Jim McCarthy (Global Head of Innovation & Strategic Partnerships), Bill Sheedy (Global Executive, Corporate Strategy, M&A, and Government Relations) & Rajat Taneja (EVP of Technology) can start the discussion with Piyush Goyal (Minister for Power & Energy) and Ravi Shankar Prasad (Minister for communication and IT). Both the departments should also be duly represented by the Secretaries (Upendra Tripathy - Energy & Dr. Aruna Sharma - communication). Since we are talking about a new way of commerce, hence the minister and secretary of commerce department (Nirmala Sitharaman - MoS & Rita Teaotia - Secretary ) should also be duly notified with the proceeding of the meeting. Ministry of finance & law should be appraised since its a foreign company doing business in India.

A task force comprising of the above mentioned people should decide the blue print of the policy. Once its decided and both the parties come to an agreement, MOU can be signed between Govt of India/State Govt & VISA (MOU will strengthen the position of VISA and will also put an immediate barrier to other players who want to enter).

VISA should enter into negotiations with the basic framework and system in place, so that they can start the pilot project in 6 8 months. Mumbai should be chosen for the pilot project because its the financial capital of India. The government in state belongs to the same party to that of center, so it will lead to smooth functioning of the project. Mumbai should also be selected for its sheer size of 13 million people and the diversity of people. This diversity will give an idea of who can be the early movers, frictions that might develop during the course of implementation & incentive/boost that needs to given for people to adopt the change.

The actual communication during the pilot project should be between the State of Maharashtra (CM, secretaries) & VISA leadership team, with Govt in India in loop.

The timeline in which visa wants to operate in India aligns with the plans and needs of the current government. VISA aggressive growth plans is in sync with the progressive plans of the government. Government wants to achieve a great deal before it goes to election in early 2019 and VISA wants to achieve a great deal within the next couple of years12

Benefits for VisaCompetitive advantage Government SupportBuilding trust & loyalty Driver model for business expansion

Strategically leverage Prime Ministers initiatives to establish a strong conversational commerce footprint in IndiaConclusion

http://fletcher.tufts.edu/~/media/Fletcher/Microsites/Cost%20of%20Cash/IBGC%20WP13-01%20Cash%20Outlook%20India.pdf 14

Additional SlidesTotal population of India12108549771.2BNo access to electricity304000000304MNo of people having access to electricity906854977No of people receiving free electricity272056493No of people paying for electricity634798484No of families (6 per family)105799747Avg monthly electricity bill per familyRs 400Total electricity payment in IndiaRs 4231989892710% adoption rateRs 4231989893Monthly revenue for visaRs 84639798 2% of total revenueAnnuallyRs 1015677574

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