SUMMARY
Are startups taking marketing too far in their efforts to increase engagement with push notifications, promotional messages and emailers?
Push notifications. You probably opened one from your email app this morning for this newsletter. Notifications — either through WhatsApp, SMS or through apps — have become so intrinsic in our daily lives that we hardly ever really notice one. So when at least three instances of such notifications this past week involving Ola and Flipkart drew concerns and criticism, it certainly piqued our interest.
Are startups and their apps going a step too far in their efforts to increase engagement and cash in on opportune trends? We look at the implications, but here are two stories from an eventful week in the tech industry:
- Better.com’s Layoffs Disaster: Better.com has found itself in the midst of another controversy around layoffs as it fired 4,000 employees without any intimation.
- To Swap Or Not To Swap: India’s EV makers on the fast charging vs battery swapping debate and what will work for the Indian market
Ola & Flipkart: A Game Of Notifications
Flipkart, Ola and then Flipkart again. This week, two of India’s biggest startups found their feet in their mouths when it came to their creative choices for notifications, promotions and emailers. It’s as if both companies decided to outdo the other with bad taste. And it shows the FUD — fear, uncertainty and doubt — that push notifications can create.
Here’s what happened.
Much Ado About Notifications: On March 8, Flipkart sent an SMS promoting a kitchen products sale on International Women’s Day, which unsurprisingly left many recipients upset.
Later in the week, Ola followed it up with a push notification for its Ola Dash quick commerce service, where it used “8 missed calls from mom” as a headline — talk about anxiety triggers.
And then Flipkart sent an email on March 11 where it claimed users had 19 missed calls. Of course, these were offers ‘calling’ the users.
Tokenism And Targeting: The problem with the Flipkart SMS is that it could have chosen to promote any other vertical from its marketplace. That it chose kitchen appliances, which just shows this was nothing but targeting based purely on data.
Given the problem of gender gap in Indian tech, companies should look to embrace diversity through culture and not resort to one-off messages or token efforts that coincide with social movements. In Flipkart’s case, the stereotype was simply tragic. But somehow it was not the worst one, in our opinion.
Preying On FOMO: Some users on Twitter pointed out that this would have been particularly traumatic for anyone who has recently lost their mother. Besides this, it’s not unusual to feel panicked when seeing so many calls from one person.
When companies use the ‘missed call’ trope, the idea is to send users into a panic and click the notification. This is especially sinister when it comes to push notifications from low-priority apps, that users often set to collapse or minimise on arrival.
In this case, only the heading of Ola’s push notification will be visible to the user when they check their notification tray and the rest is hidden behind another tap. It’s one of the classic dark patterns that preys on anxiety and many other companies have been known to have used in the past.
And What About Ola Foods? But there’s another problem with Ola’s push notification; it talks about ordering groceries to cook at home instead of food from a restaurant.
Of course, it’s a dig at Zomato and Swiggy, but one mustn’t forget that not that long ago, the Bengaluru mobility and electric vehicle company had also ventured into the food delivery business with Ola Foods, which did not take off as expected.
Notification Fatigue: Something also needs to be said about notification fatigue. We have dozens of apps — sometimes alternatives — and they all want our attention. And as we become more reliant on digital services, the competition for your attention and screen time will lead to more such notifications with emotional and psychological hooks. Well at least, thankfully, they can be managed easily on Android and iOS.
There’s also some weight behind claims that unwanted or excessive notifications can turn users off from a service. Indeed, many users professed to have turned off all notifications from Ola after the latest gaffe.
Tech Stocks And Startup IPO Tracker
- Navi Gears Up For IPO: Navi is on track for its stock market debut and has filed its DRHP for INR 4,000 fundraise from the public markets
- Swiggy’s $1 Bn IPO: The foodtech giant has on-boarded JP Morgan and I-Sec ahead of its IPO expected in CY23
- Ebixcash Files DRHP: The payment solutions company will be raising INR 6,000 through an entirely fresh issue and no offer-for-sale
- SEBI’s IPO Valuation Scrutiny: Startups told to get their non-financial metrics audited and justify valuations before going for IPOs
Indian Startup Funding Counter
- ? Funding Booms With BYJU’s Round:Overall, Indian startups raised around $1.9 Bn across 40 deals, but this was primarily due to $800 Mn round for BYJU’S, and edtech startup Eruditus’ $350 Mn funding round.
- ? New Fintech Unicorn: Lending services startup CredAvenue bagged $137 Mn at a valuation of $1.3 Bn, making it the first unicorn of March 2022.
In Spotlight | 30 Startups To Watch
As a part of the 25th edition of the ‘30 Startups To Watch’ series, we looked at 30 unique startups that are innovating across healthcare, blockchain, enterprise tech, fintech and other hot sectors. This being the silver jubilee, we also looked back at the startups that featured in this series over the last two years.
The 650+ startups in this series have raised over $1.5 Bn cumulatively after they were featured by us, with a combined valuation of $5.4 Bn. Over these two years, we featured more than 142 enterprise tech startups, 109 fintech startups and 73 ecommerce startups. Take a look at this month’s edition.
Unicorn Financials
- Razorpay has reported its first profitable year: Revenue INR 844 Cr | Profit INR 7 Cr
- Moglix sees 2X revenue growth, but still in losses: Revenue INR 776.6 Cr | Loss INR 81 Cr
- MPL cuts losses by more than half: Revenue INR 378.5 Cr | Loss INR 129.4 Cr
Paytm vs RBI & Other Top Stories
- ? Paytm In Trouble: RBI has asked Paytm Payments Bank subsidiary to stop onboarding new users again and will conduct an IT audit
- ? BharatPe’s Tax Issues: The fintech unicorn is being probed for further instances of tax evasion after already being charged INR 12.5 Cr in tax penalty since October last year
- ?? Times Leadership Shake Up: Times Internet CEO Gautam Sinha has resigned after 15 years at the Times Group, at a time when the company is seeing major revenue slowdown
- ? UPI On Feature Phones: RBI has announced ‘UPI123Pay’ for offline digital payments on UPI via feature phones
- ?️ Walmart’s Digital Focus: Walmart has no plans to enter consumer retail in India and will continue to focus on Flipkart and PhonePe for online retail
