Digital technology is transforming the marketing functions. This edition of Story Board understands how Visa, the electronic payment service provider functions.
Digital technology is transforming the marketing functions. This edition of Story Board understands how Visa- the electronic payment service provider functions. Visa has been active in India for 30 years now and has worked to popularise the use of credit and debit cards in an environment where 97 percent of financial transactions are in cash.
Visa’s marketing director for India and South Asia, Shubhranshu Singh explains how B2B business data analytics are used to decode consumer trends and to create ad campaigns and to power all aspects of marketing.
Below is the edited transcript of Singh's interview to CNBC-TV18.
Q: Data analytics, how important to your business and to your function at Visa?
A: If Visa was a manufacturing enterprise and if we had assembled everything we need to do business under one roof, we would probably only see data running from one place to the other. So, data is not only the fuel that drives the engine but it is the very basis of our existence.
Visa looks at data very differently and we are a Business-to-Business (B2B) enterprise. One of the intelligent things that we need to do is to make sure Visa is being the same thing to everybody, no matter which bank or which issuer gave them the card. As a result, super abundance of data is also a problem and therefore we are not interested in data in person specific terms. We would like data to be aggregated such that it makes sense not only to us, but also to the businesses that we are committed to grow along with our partners. So, we are looking at business data which is relevant, actionable and helps us to grow productivity and efficiency.
Q: How do you do that? Some literature suggested that every second you have some 24,000 transactions that are taking place?
A: We are looking at data continuously, but just because there are 24,000 transactions per second they don’t flood into some desktop where we have to make evaluations of it. What's intelligent in our use of data is, going back to the partners that we do business with, namely the banks. Take for example cross border travel, a person who is traveling across international boundaries, chooses to use his or her credit or debit card abroad. The amount of information that we need to be equipped with, to inform the banks that this franchise of card holder is behaving above benchmark or below, clears the way for us to pool our resources to be able to incentivise them better. It allows us to educate them better, to reassure them that they are safe and secure and that indeed, using a Visa card is the most secure and versatile means for them to make the most out of their holiday or business travel.
Q: Does this kind of insight also lead to the kind of advertising investment that you would make and where it would go?
A: Absolutely. On the dashboard the moment there is some proof of concept, pilot, we then know that this is something we can leverage to greater effect. So, constant measurement informs us about the need to build more robust campaigns in a particular direction. We are doing continuous research on a qualitative side as well. So there is measurement and there is judgment and there has to be a healthy balance between the two.
For instance take our cross border campaigns, when Indian travellers are going to America looking for particular types of shopping missions, if our Visa counterparts in those geographies help us to tie in promotions, then the entitlement that they have to get a greater deal or a better deal because they have a Visa card will show up when the shopping gets done.
It is clear evidence and because international transactions are routed on to VisaNet, we are in a position to inform our partners saying that because of the investment that you made, you got a justifiably higher business return. That then, clears the way to make it a continuum of investments.
Q: What are some of the trends that you are seeing in this space in the last couple of years?
A: The first reference to context for any trends where India is concerned, is that it is an incredibly young country. We are seeing a youthful, energetic population coming on to the card holder population as well. India is probably the most optimistic, the most empowered lot of young consumers who have great belief that their future is going to be better than their present. One of the ways in which this behaviour gets reflected in their everyday lives, is that they are happy to spend. Transactions online across tier II cities in India show that there is clear evidence that people are choosing to transact online because it allows them to draw goods and services which were not available in their town centres.
Q: A lot of e-commerce sites are saying that their growth is getting fueled by tier 1 and tier 2, who are not physically able to access some of the brands that they are making available online. It just categorically emphasises what you are saying as well.
A: That’s exactly right and we have several parameters of which to judge this. For example average ticket size, the number of transactions that you do. The transaction frequency or the level of penetration by channel and it is interesting where traditionally people would have gone for seasonal shopping and for large ticket sizes may have chosen to use their cards. Once you get used to the convenience and the ease with which you can transact online, you are a committed shopper online.
Q: So that’s a trend you are seeing?
A: Social media is being used to generate word, or element mouth. People are getting advised from people they don’t know. People are researching a lot more before they undertake their annual vacation. So, there is a research information insight build up, even on the consumer side and we are at best reflecting or trying to be a mirror image of where they are choosing to go and spend. People are very interested in careers, in education. Youthful exuberance is not about living life for today. They are also making meaningful investments for their future.
Q: So you have this information that’s coming to you. You are mining it in a certain way. You come out with certain insights and then you have to work with your partners to sort of get to put this into action?
A: Yes and no. Our first objective is to make sure being a business-to-business enterprise that all our partner entities also grow and that everything we do is an enabler and a catalyst for their business growth. However, at the same time, Visa has a responsibility to reach out to consumers and tell them all the things that we are doing for them in their everyday lives. For example, risk and fraud education; the fact that people are getting used to new ways to pay means that they are also probably liable to fraud and susceptible to the risk of being defrauded.
This is a campaign where evidence is clear, because forensics will prove how people fell victim to fraud and then a campaign that we did on radio very successfully educated people about that. In our latest debit campaign, called ‘Dream to Advance’, we are saying, “No matter where you are, your aspirations and ambitions need not be locked in by geography.” The reason we are doing that is because we saw evidence across the last two years of increasing activation from tier 3 centers from across the country. This clearly means that people are now looking to build bridges with the larger economy.
Q: What are some of the challenges in the way data is collected and most critically how it is analysed in your business and especially at Visa?
A: Firstly, as a marketer and particularly true of my role in Visa I would tell one thing, a surfeit of data is something that you should be careful about because very often we fall into trap. Marketers can fall into trap of confusing causality with correlation. For instance if a particular thing is noted behaviour A, and at a same time behaviour B is noted; it is not necessary that A is leading to B.
As a marketer and as Visa, it is my role to ensure that everything that I tell my consumers results in viable actions. So the first challenge is to make sense of the data. It can’t be a fishing expedition where you are pulling out and then seeing what you pulled out in the net. The second bit is about migrating consumers to new behaviours. Behaviour change is a very difficult thing to achieve and particularly when it comes to things like online.