Kavin Bharti Mittal is out of his seat, trying to demonstrate why Hike’s sticker-first approach makes it fun. The Hike founder shows an example conversation in the new Hike Sticker Chat app on his phone between two friends meeting for a movie.
Friend 1: Hi. Where are you?
Friend 2: On my way
Friend 1: How long will you take to reach?
Friend 2: Five minutes away.
Friend 2: Buy the tickets!
It’s a real conversation; which one can have on WhatsApp or Facebook Messenger or plain old SMS. But the interesting part is that Mittal didn’t type out an actual word, nor did he use voice messages for the chat; instead, he used stickers. The whole conversation, with those three to four phrases per side was carried out on stickers.
We can finally see what the hype for Hike may all be about. It’s admittedly fun, it’s a lot richer than text, it’s not as cumbersome as gifs (finding the right one is not always easy and they take time to load up, according to Mittal), and it’s definitely cooler than voice.
Launched in 2012, Hike is one of India’s oldest messaging apps and reached 35 Mn users by 2014. It then grew to 100 Mn users by 2016 and along the way became India’s fastest unicorn, before Udaan took that title.
Today, the company claims to have 160 Mn users. Mimicking the WeChat model, Hike morphed from a regular chat app to a super app around 2014. It started added features such as live sports scores, offering news, daily games, a social media feed or timeline, and integrations for shopping, recharge and ticketing with Hike Wallet. All of this was packed into a single application.
While the future for a super app looked bright at the time, the company is now bringing the focus back to the primary chat element with the new Hike Sticker Chat app, launched last month after being in beta for a few months.
When asked about the U-turn, Mittal said that the smartphone hardware has evolved to allow multiple apps instead of one super app. Mittal said users didn’t have enough storage space in their smartphones at that time and weren’t comfortable with having multiple apps on their phones.
“But things are changing now,” according to Bharti Airtel founder Sunil Mittal’s son. He said data is getting cheap and smartphones faster. It makes sense to focus on one app and deliver a quality experience in that sphere because the technology is there now to make it happen in the best way possible.
“The big question around 2016 was whether the market would be stable or will it shift. We can call it the western consumption model or the eastern consumption model. The eastern consumption is super app-centric, and western is one or two apps instead of a super app,” he said.
“Our prime focus is on reducing the dependence of the keyboard” – Kavin Bharti Mittal on Hike Sticker Chat
So Mittal went back to the drawing board. The company designed a sticker chat experience from scratch and is using state-of-the-art machine learning and artificial intelligence standards to take stickers to the next level.
Machine Learning Comes To Stickers
Hike infused with machine learning and artificial intelligence technologies and more emphasis on using stickers for conversations, instead of text. Mittal told Inc42 that the revamped Hike Sticker Chat app was born out of the company’s ideas to eliminate the need for keyboards in mobile messaging apps. He believes that virtual keyboards can’t fully replicate the experience of communicating in a regional language in India, while stickers can easily fill this gap.
As a result, Hike Sticker Chat has a machine learning-based stickers engine, which not only recommends new stickers for anything you want to say but also suggests stickers to use in response to stickers sent by other users. The app recommends stickers that are related to the conversation by analysing the context and mood of the conversations.
The app also uses artificial intelligence (AI) and machine learning (ML) to design and automatically create multi-contextual stickers for users based on signals such as emotions, colours, fonts, and language.
It’s all part of the company’s plans to reduce user dependency on the keyboard to input what they want to say, especially in Indian regional languages. Mittal believes that the current keyboard experience for Indian regional language users lacks a lot of intuition and it also doesn’t make sense for those in India conversing in two languages simultaneously.
Mittal said that Hike’s recommendation engine is smart enough to tell when you are chatting with your girl or guy buddies, and when you are chatting with your spouse or partner, and show you custom stickers for both situations. Going forward, the AI engine will create stickers that are meant for holidays, trending events or any current topic.
“The best part about machine learning is deep learning, the more we understand you the more accurate the platform gets.” – Kavin Bharti Mittal
As of now, the app has over 30K stickers available in over 40 Indian languages and dialects, which Mittal says only covers about 15% of vocabulary for online communications. The company’s idea is to use AI and ML to fill the wide gap in demand and supply of multilingual stickers.
Mittal underlines this as the USP of its revamped app. “We are able to give you the best stickers because we understand your age, your gender, your location, who you are, your personal preferences, the season of the year, and we broadly understand the relationship between our users based on the chats,” Mittal said.
Mittal said it would help the AI tailor sticker recommendations. “A lot of the content we will create now which will take us from 30K stickers to around 100K will be mostly machine generated and that is really powerful because that lets us scale up languages,” he added.
Next Steps: Content and Gaming
Before starting our interaction, Mittal told us that the ‘new’ Hike will be built around three pieces. The first piece of the puzzle is the chat app. “So there is gaming, and there are news and content as well.”
The gaming product was born out of the popularity for the ‘game of the day’ section within the original Hike super app. Mittal said it saw great engagement from users, though admitted the games themselves were not very good.
“We believe casual gaming is where the content market was 2-3 years ago. It is for the taking, someone can do very big in the casual gaming space. And so that’s the second pillar.”
He didn’t go into details about the news and content part of the equation, but both these products will be coming later in the year. For that Hike needs to expand and hire more aggressively. “The one thing that has worked very well for us very well is the young talent, it is what we build the company on for the first four years, and because things are changing so fast, evolving so fast, young people are less rigid to the way the world works.”
Despite being in a category which has a high customer acquisition cost, Hike has managed to stay financially healthy enough to attract top talent in highly-competitive fields such as AI and ML. “We have no logistics, no warehousing, no inventory. There are no cashbacks we are giving, so we are a low OPEX company, and our cost is people and service.”
The Numbers ‘Game’
Since its launch in 2012, Hike, today, claims to have had over 160 Mn users, most of these coming in the first few years when it grew to 100 Mn users.
The Delhi-based venture, backed by SoftBank, Tiger Global, Tencent, Foxconn & Bharti, with over $261 Mn till date, is valued at $1.4 Bn.
Since the first few years, Hike’s adoption has slowed down and Mittal is honest enough to admit that reporting such huge numbers is a ‘game’. He confessed that huge number is not meaningful enough.
Why do companies still report it then? “We have moved on to weekly metrics,” says Mittal, brushing aside questions about the monthly active users. But that’s the most he was willing to say, without giving us an actual figure.
Mittal also said that users spend around 30 minutes per day in the older Hike app, but expects the Sticker Chat app to have a higher session time due to the content.
Despite telling us the number of downloads doesn’t matter, Mittal did give us more download numbers for Hike Sticker Chat. “We are getting 50K downloads a day, and we would like to be 200K per day by the end of the year.”
“We have a 145 person team, but don’t be surprised if you see us expand our team. By the end of the year, we will be around 180-190 people.”
Of course, the big question is monetisation, and we asked Mittal whether he thinks Indians are willing to pay for something like stickers in a chat app. He said that Hike’s monetisation model may not necessarily follow the typical user-generated revenue. “We have partnerships with Bollywood, like the Gully Boy partnership which went viral. The Gully Boy stickers inside and outside the app got much more traction than others.”
And how many do they have currently? Kavin Bharti Mittal left us with an ambiguous “10s of millions”. That’s still a long way away from the monetisation scale that Hike wants, and the journey is going to be far from easy. Having said that, Hike has created a memorable brand around stickers and with its focus on new age technologies, it’s doubling down on this bet, which is admirable, even if risky.