Following up on my article on the cost Flipkart may have to bear on Airtel Zero, I decided to extend it further by decoding the ROI effectiveness of the Airtel Zero platform.
Since there is a strong debate on how Airtel Zero is not violating Net Neutrality, I decided to look at this new “marketing platform” from a pure ROI perspective & let startups decide.
In one Twitter exchange yesterday, Anand from Airtel claimed that the platform might have 60% less cost per acquired user. (BTW, I really appreciate the effort Anand took to explain Airtel’s stand on this)
@deepigoyal our data shows 60% less cost per user acquired. Competitors spending more isn’t just on this channel its for any channel.
— Anand Chandrasekaran (@anandc) April 11, 2015
So I took to excel again & tried to create a simple ROI model:
While in isolation, Airtel Zero doesn’t look like a good acquisition channel, I decided to simulate numbers for three different Apps with varied monetization models.
This model is just to compare the overall ROI and in no way representative of an actual revenues you may make from this App base
Advantage Airtel Zero: Free Organic downloads + Higher Sessions but that’s where the cost starts to hit you ☺
Please Note, that the above model only takes into account the cost of month 1. Airtel Zero will continue to cost the startups based on usage so returns will further deteriorate.
I am including the excel sheet used to arrive at numbers above. Feel free to tweak the data, add your own numbers and see the returns. Download the sheet