Roughly there are more than 30 million small and medium enterprises in India which makes our country a big and lucrative market of opportunities for startups, service providers and foreign merchants who are eying to sell their services. But harnessing this big market is not that easy as it sounds.
We spoke to Nikhil Arora, Vice President and Managing Director, Intuit India about his views on Indian SME market and on the company’s strategy to tap it.[Edited Excerpts]
Inc42:Tell us about Intuit? When it started operations in India?
Intuit is a $4.2 billion global company founded in 1983, and is a leading provider of business and financial management solutions for small and mid-sized businesses. Intuit India, the company’s first venture in Asia Pacific, commenced operations in 2005 and currently has more than 800 employees across offices in Bangalore, Mumbai and New Delhi.
Our commitment and investment in India is three-fold:
- Building solutions to help Indian small businesses be more successful
- Investing in Indian employees
- Learning from the best in India
Our flagship products globally like QuickBooks, Quicken and TurboTax are all developed with the goal of making financial lives of small businesses owners easier. QuickBooks started its journey 25 years ago as a desktop product, and is sold globally in markets like the US, Canada, UK and of course, in India. Today, QuickBooks Online is the leading cloud business and financial management software globally, with over 1.48 million users using it in over 124 countries in 12 languages.
Intuit launched its flagship small business financial and business management software, QuickBooks Online in India, in October 2012.
Inc42: What are your main product offerings for Indian market? Up till now how has been the growth? If you can give us any data points on no. of customers (approx. like >50,000), no. of registered users vs. no. of paid users (in %age will work)?
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Our flagship product QuickBooks has been trialed by more than 50,000 small business owners since its launch in India last year. The Accountant community in India has emerged as a strong supporter of QuickBooks in the last six months with a 49% growth rate in adoption, and they are playing a key role in recommending their own clients to migrate to QuickBooks. Over half of QuickBooks subscribers in India are located primarily in 4 cities – Bangalore, New Delhi, Mumbai and Chennai and the figure is growing.
Inc42: Tell us more about QuickBooks. Has the product been customized for Indian market? What are your typical customers in India?
We started with extensive interaction with small businesses and tested QuickBooks with customers in the alpha phase. Based on the rich feedback and data gathered, we began to customize the product with basic local currency and business taxes in mind while introducing the product in India. In addition, we incorporated features that small business and accountant users can customize to fit their applicable tax needs, including VAT and service tax. Also, based on understanding the requirements from our customers during the alpha testing phase, Intuit introduced 4 new features in the India product:
• Inventory – Enables our retail and wholesale customers to keep track of their stock and goods.
• SMS updates – Enables small businesses to stay on top of their business finances by opting to receive regular updates on balances, reports via SMS. (Available in Plus version and will work if you are not NCPR registered)
• Schedule XI Reports (Profit & Loss and Balance Sheet) – Reports to assist conformance to accounting regulations in India.
QuickBooks was launched in India in October last year (2012) and we are very encouraged with the results we have achieved so far.
In terms of verticals, today, QuickBooks provides the most value for small businesses in the service sector such as IT Consultants, Lawyers, Advertising & Design agencies, Event management agencies, Architects, Interior Designers etc.
In November this year Intuit launched the reimagined QuickBooks–as the global small business operating system for better functionality.
Inc42: Being a cloud based product, do you face any problems and challenges in selling it to Indian SME’s? What is the response of SME’s you have witnessed?
It is a market reality that even though we have a significant number of small businesses in India, only a small percentage of them are online. Cloud is often perceived as a complicated technology, which is not true at all. In fact, our communication to small businesses has always focused on highlighting cloud as a better alternative to reduce capex and improve productivity.
There are also concerns that small business owners bring up on network infrastructure and data security. There is some education that is needed to create awareness on this issue at an industry level, but we are seeing things change at a good pace. Cloud solutions are definitely the way to go and I am confident that we will see this trend pick up rapidly among small businesses in India as well.
Inc42: Indian SME market is very big but a tough nut to crack. What measures you use for marketing and customer acquisition?
Our market approach focuses on the following key pillars –
1. Direct channels – through web search marketing via SEO, SEM
2. Interactive Webinars to onboard
3. PR and social
4. Tele-sales channel
We would like to be an enabler of the small business ecosystem in India. We have set up an India Advisory Board, under which we have brought together policymakers and thought leaders that empower micro and small businesses through the adoption of technology, training and other key capacity building efforts. Intuit’s association with the Ministry of MSME (Micro, Small and Medium Enterprises), Govt of India, is an endeavor to identify solutions to improve the technology adoption among small businesses in India to enable growth.
Another key aspect is, as part of our, ‘In India for India’ philosophy, we practice “Follow-me- homes” which means Intuit employees spend time in customers’ own environment to be able to discover unique behaviors, wants and needs of the Indian SMB market. This approach has been used very successfully, globally, by Intuit and we gain incredible insights and value from this exercise.
Inc42: Tell us some of your strategies you apply for retaining customers?
Our strategy has been to address the three As: Awareness, Availability and Affordability.
- Awareness – relates to reaching and influencing our customers. Today our main channels of reaching customers are through web marketing, social media, events, partnership and collaboration within the small business ecosystem.
- Availability – is delivering a seamless experience for our customers to try and purchase our product. We have a robust telesales team that engages with a user the minute they sign up for a free trial. Assisted on-boarding or training are provided via customer care and in-product help whenever a user requires it. We also have accountant managers who manage customers across regions and ensure we are engaged with our customers, listen to their needs and do our best to solve for them.
- Affordability – QuickBooks has been priced on a yearly subscription model. A one-year subscription is priced at INR 4999, which is less than INR 15 per day for a year. We also provide a 30-day free trail, enabling users to try the product and then make a purchase decision.
Inc42: How you plan to move ahead with the product in coming couple of years? How you see Intuit India shaping up in Indian SME market?
We will work hand in hand with our customers to ensure the product closely mirrors the needs of our customers. Our vision is to be the operating system behind the success of Indian small business. By 2020, we want 1 in 4 small businesses in India to use Intuit products. We have been successful in being the small business ecosystem service provider in other markets like North America and the United Kingdom, and we believe we can successfully replicate the model in India by helping small business and accountants grow their business, manage their finances and manage their payroll.
Another initiative we have is the Intuit QuickBooks Excellence Awards. We constituted these awards for emerging businesses that have embraced innovation and high degree of customer orientation.
We have hosted several workshops and sessions on the benefits and impact of cloud on helping Indian accountants grow their practice and become globally competitive.
Inc42: Tell us something about yourself, your background etc.?
I grew up in New Delhi and Chandigarh. After completing my schooling at St. Xaviers in New Delhi, I received a scholarship to study Russian language in the then, Soviet Union. I spent two years in the Soviet Union, and then moved to the United States to pursue my higher education in finance and international business. I picked up my first job at the age of twenty-one working at Miramax Films. My work career spanning nearly twenty years has offered me the opportunity to live in five continents including Central Asia, Europe and North America and has allowed me to work across five diverse industries.
I joined Intuit two years ago with a mandate to drive the company’s strategic growth in India and lead its regional go-to-market efforts for small business and consumer offerings.