With its minimal design, clutter-free experience & innovative product offerings, PhonePe has a competitive advantage across all the major payment apps in India.
Why does India use PhonePe?
For me, the most important user experience while processing a payment is “How fast can you make the payment without compromising on security”?
PhonePe is the fastest! (Experiment + Proof)
If you conduct a usability test by noting down the time taken by major payment apps to complete a UPI transaction, it could give a rough idea of how fast the app is. I did the same. Below are the results:
- PhonePe takes the least time (around 56 seconds) to make a UPI transaction.
- Google Pay took around 144 seconds. It took 3 attempts to make a GPay transfer as the app was not able to load once you click > Start Payment.
- Paytm took around 64 Seconds. You can add more 5 seconds to it as the Paytm app didn’t have any fingerprint/PIN verification by default.
Every time I made a payment using PhonePe, I would look at the PhonePe Switch icon, hesitantly click on it, scroll a bit & exit the app!
What is PhonePe Switch?
“PhonePe Switch” allows you to use your favorite food, grocery, shopping, and travel apps from within the PhonePe app itself. You can log in to these apps without even downloading them, with just a single tap” As of 16th March 2020, PhonePe Switch has 100+ partner apps live on the platform.
You can even create a digital resume & apply for jobs through PhonePe Switch!
Problem Statement – Building & marketing an app is tough!
A basic food ordering app with live tracking will cost you Rs 6-7 lacs. You will spend lacs of rupees on the development of an app, followed by marketing expenses to acquire & retain these customers. Even after these efforts, you will face issues of uninstalls & high churn rate.
Solution – PhonePe Switch
PhonePe Switch enables a merchant (like food ordering app) to integrate their existing web application or mobile-sites to the platform, and instantly reach out to over 60 million monthly active PhonePe app users. Basically these merchants don’t need to develop a full-fledged mobile app & bear the marketing cost for it.
How did the idea of “PhonePe Switch” originated? (WeChat – Mini Programs)
In 2017, Sameer Nigam (Founder & CEO of PhonePe) flew to China with his team. Upon visiting the office of WeChat, which is China’s largest messaging & payment platform, he noticed the deep penetration of QR codes in the offline market & how 1 Million businesses were a part of its “mini-program initiative”. Mini Programs are small apps built inside WeChat.
WeChat has 1.2 Billion registered users, out of which 67% are monthly active users who interact with its mini-programs.
In China, “WeChat is the Internet”.
WeChat was launched in China in 2011. It was also launched in India in 2013 (do you remember the shake & chat feature, where you could shake your mobile & chat with a person who also shook at the same time?) It transformed itself from just a messaging app to a “Super App” with the inclusion of payment & mini-programs.
What does the primary research for PhonePe Switch users indicate? (It’s Shocking!)
To do primary research, I did 2 things:
1. Asked my Whats app Contacts to message me if they have used PhonePe Switch
- Reach – 170+ contacts saw the WhatsApp status update asking them to message me if they have used PhonePe Switch
- Conversion – 5 of them messaged that they have used PhonePe Switch.
What are the users using PhonePe Switch? (Obviously, because they won’t have to download other apps, right?). NO!
Below are the screenshots of the user interviews that were conducted as part of primary research:
I use PhonePe Switch because there are discounts & cashback.
This was a standard answer from all the 5 users. One user went on to explain that “By using PhonePe, you will get cashback on the PhonePe app as well as the app from which you are making the transaction (e.g. Swiggy/Zomato), so there are dual advantages”. The other user said: “The cashback & offers available on PhonePe are not available anywhere else”
Clearly, No one said that “It helps me to save memory on phone” or “Why do I need to download other apps when I have PhonePe Switch”.
In fact, if you search “PhonePe” switch on YouTube, there are a host of videos in Hindi that would guide users on how to avail these discounts. (See the screenshot below)
2. I tried using PhonePe Switch myself
Below are my findings:
a. The icon is confusing at first glance. It feels like that the app will switch itself to something else upon clicking. This is because of its look-alike with the Toggle Button.
b. The mini-apps built inside (like 1Mg, Lenskart etc.) took more than 20 seconds to open, which was not a good experience because of the long waiting time.
c. When you click on the Lenskart app, you expect a mini-app of lenskart with an option of 3D trial of eyeglasses to open. Unfortunately, the mobile website of Lensakrt opens & that too with a long delay again.
d. I was confused if I had to separately login to each app. Apparently, I had to log in for each app separately which was again very time taking. I didn’t even remember passwords for each app.
e. The individual app offers more functionality, faster access to customer support/chat feature & the “trust factor” is high.
What do Tier 1 & Tier 2 Indian users prefer?
Choice: Indian customers prefer choice in their options. We are spoilt by the eCommerce cashback & coupons. You would surely want to check different options before making any purchase decision. And of them is opening that individual app for coupons & cashback in the hope of hunting a better discount.
Hence it defies the main purpose of a “super app” or “an all in one app” which is you don’t need to install other apps.
So what’s the solution?
The Next Billion Users (Rural population) who have not been yet exposed to apps like Ola/Uber/Lenskart/Practo.
India has a rural population of 833 Million with only 277 Million (33%) as digital users. They have been unexposed to cashback, coupons & discounts. They still prefer to buy a TV from a local electronic store after visual inspection.
If PhonePe switch could be integrated with the needs of such rural users e.g.
- Integrating Baba jobs & Asaan jobs for blue-collar employment,
- Integration of app which helps in learning English,
- Appointment booking with doctors & storing medical reports in the PhonePe app & ordering the prescribed medicine through a local medicine shop & using 1MG to order medicine eventually.
For these users, PhonePe could be the internet as it would allow them to book their 1st Ola Ride & 1st Zomato order. The market is still not penetrated properly (33% penetration of smartphones) & PhonePe will have the early bird opportunity.
Overall, PhonePe has always kept customers delightful by offering minimal user experience & delivering innovative products like Super Funds, Liquid Funds & Corona virus insurance. PhonePe Switch could be that “transformation” which would enable it into a successful platform business.