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Facebook Brings Its A-Game To India
Partnerships will continue to play an important role in Facebook’s India game plan
Photo Credit :
Progress comes with after effects. Advancement in technology, for instance, created a power group that impacts consumers and businesses. Known as the ‘Fearsome Five’, this group comprises Alphabet (age 21 and Google’s parent com- pany), Amazon (26), Apple (44), Microsoft (45) and Facebook (16). The youngest among these, that is home to Facebook, WhatsApp and Instagram, globally engages 2.4 billion people every day. And this mighty network has gone all out in making India a ‘market-critical’ in its future-readiness strategy.
Facebook, where terms like ‘India-first’ and ‘build for India’ are part of daily conversations, set aside Rs 43,574 crore for a 9.9 per cent stake in Reliance Jio Platforms, making it the largest tech foreign direct investment in India. Indeed, India is the largest consumer base for Facebook and WhatsApp and is growing numbers for Instagram too. The results may be surfacing now but the wheels have been in motion for a while.
A Clear Signal
Facebook began its India journey in 2010 with an office in Hyderabad, its first in Asia. Indians were already on the platform and this operation was a support engine. Since then, FB’s ‘integration’ into the India digital story deepened to a point where in 2018, it created a country operating unit in India with all its functions under one umbrella, and this unit was structured to work directly with Facebook’s headquarters.
This should not come as a surprise. Facebook’s CEO Mark Zuckerberg had once commented that to connect the world, India must be connected. The work done in the last four years, where data proliferation made digital central to dramatic transformation in India, reiterates the sentiment behind Zuckerberg’s words. No other coun- try in the world has seen nearly 500 million people come online at this pace. Layered with the size of the Indian economy and its openness sets the foundation to build a digital infra- structure at scale. This allows compa- nies such as those among the ‘Fearsome Five’, entrepreneurs and individuals to experiment, innovate and build new products and services. Facebook entrenched itself deeper in India. One way was to fuel the entrepreneurship network. With a ‘not-self-interested’ approach, it invested in startups Meesho and Unacademy. It increased the number of partnerships and investments in India. It devised a three-pronged strategy that began with ‘expression’, essentially referring to the first level of connectedness and user generated content on Facebook and Instagram; articulating its role for enabling growth for micro, small and medium businesses (MSMEs) wherein WhatsApp too plays a part, and inclusion that Facebook looks at in many ways, including financial inclusion.
Expression – Where It All Begins
Facebook thrives in a democratic set- up. Creative expression and social video hence are high on its agenda. The focus on the latter also explains why Jio Platforms was on FB’s radar to explore partnership.
“Videos play a big role in communities. When you are already engaged on common interests, video can fuel it further. We have seen the proof of this in the last four years, since the early days of Jio’s entry into 4G that was marked by dramatic reduction in data cost,” says Ajit Mohan, VP & MD, Facebook India.
The increase in video consumption also led Facebook to test short video platform Instagram Reels in India. In many ways, ‘expression’, as Facebook defines it, sets the base from where businesses can reach out to a large consumer base. Earlier this year, Hyundai India part- nered with Facebook to launch Hyundai Aura, and leveraged Branded Content Ads using Influencers. Over the years, Facebook has layered this with efficiency with right targeting and tools, and then creating digital experiences that make it almost a first stop when companies are thinking about their online presence. As the lockdown spurs digi- tal adoption, Facebook’s groundwork becomes handier.
KIRTI POONIA, Head, Okhai
“Going digital was a no-brainer. We needed Google marketing as well but for a visual product like ours, FB or Instagram were needed. These are the only channels that converted to sales”
The MSME Ally
Samsung partnered with Facebook to train offline retailers to go digital by enabling them to build a digital pres- ence through Facebook apps, allowing local consumers to discover these businesses online. Vodafone Idea launched a WhatsApp chatbot to cater to consumers. In order to drive incremental reach for Eno in Rural Clusters, the brand mapped the inter- nal business to geographic pin codes (via census and postal Pin code direc- tory) identifying rural clusters to be targeted. These are just some of the cases where large companies could do more during Covid times. Smaller businesses perhaps did even more.
Pristyn Care, for example, saw elec- tive surgeries getting put off in the lockdown. It diversified by offering online doctor consultations, selling pharma and medical supplies including masks and sanitisers. In this time, it increased its ad spends on Facebook to drive results.
Ed-tech business, Paper Boat leveraged Facebook to drive downloads and subscriptions (up over 100 per cent as compared to pre-lockdown) for its pre- school learning app, Kiddopia.
Yet another example is fitness app HealthifyMe, where the app used Facebook advertising for contextual messaging and do ‘Live’ videos with nutritionists, share fit- ness challenges and educational tips. “Facebook’s product evolution makes it valuable for small businesses. India has about 60 million of them. They accounts for the bulk of the economy and most of the jobs. We find a long tail of small businesses who leverage our platform the most.”
The reason for this is that the Facebook marketing platform is built with an emphasis on return on invest- ment (ROI) on marketing spends.
“No other platform comes close to Facebook’s scale. But it is not just about reach but also the right targeting that brings in efficiency and tools to really make the spend on Facebook work. A business can invest as much as $1, by a simple action on the mobile phone, to gauge return. And there is much that can be done through the process, whether it is advertising on Facebook, engagement on Instagram or after sales through WhatsApp or Messenger. This is what makes us a perfect ally to businesses, specifically to small businesses,” says Sandeep Bhushan, Director & Head, Global Marketing Solutions, Facebook India. Facebook had already added the layer of digital experience for brands through the likes of Facebook Live when Covid hit. At this time, Facebook had begun the process to understand how consumer behaviour was shifting, and how digital influ- ence could be leveraged. As different industry verticals faced different challenges, the platform layered its solutions for each verticals separately.
“For example, in the tech and auto category, experience is important. We provided AR and VR filters at evalua- tion stage to create relevant experi- ence. We brought in influencers for brand trust. These learnings apply to small businesses as well, but no one is taking these tools to them,” Bhushan explains.
Aiding In Economic Revival Facebook’s MSME focus can be seen as it took its services a step forward by not only providing efficiency but also training small businesses and arming them with the tools they needed in lockdown times. It also provided sup- port such as the SMB Grant, a global programme of $100 million.
Jio’s partnership with Facebook also falls in line with this focus. As Jio Mart connects local grocery stores online, Facebook is looking at the role that the 400 million WhatsApp users can play in achieving this. “This is the wheel that sets the economy off in a positive direction. In the last 10 years, there has been an explosion in entrepreneurial activity. But the real ques- tion is what lifts companies to move from an idea to finding national and then international markets. The Jio deal is one of our most involved efforts to connect the dots. We can play a central role in fuelling the growth of small businesses in India, and that mission is critical to India’s economic growth,” adds Mohan.
Okhai, that offers handcrafted apparel and lifestyle products made by rural artisans, has benefitted from Facebook’s expertise. Lockdown had meant a 53 per cent drop in Okhai revenues in April 2020. The platform that is present on Facebook and Instagram as well as Pinterest, embraced digital more.
Okhai now begins its day with video calls on Google Hangouts where artisans from villages join in. As it took production management online, Google Sheets came into play to track production location. It uses Unicommerce to track inventory and manage backend and also online store builder Shopify. Facebook’s role became pertinent in sales.
As Okhai opened up its platform and rallied similar businesses to join in, its July 2020 revenue registered a 157 per cent increase in comparison to last year. “Going digital was a no- brainer. We needed Google market- ing as well but for a visual product like ours, FB or Instagram were needed. These are the only channels that converted to sales. Others were good to have but business outcomes come only from these,” states Kirti Poonia, Head, Okhai.
Revenue Roars Strong
Facebook Inc reported better than expected revenue and earnings on July 30, 2020 beating industry esti- mates. As a result, its shares were jumping in the after-hours trading session following the results, up more than 5 per cent. The company deliv- ered second-quarter revenue of $18.7 billion. Additionally, it saw a big jump in daily active users to 1.79 billion.
In India, Facebook clocked in Rs 2,862 crore gross revenue, including half the year ad revenues for fiscal 18-19, as per data seen from the Registrar of Companies (ROC).
The social network’s lion’s share of revenue comes from advertising, and it occupies a top seat in the Indian market structure cornering nearing 75 per cent of the spend along with Google. But there is work to be done.
Reiterating this, Ashish Bhasin, CEO-APAC & Chairman-India, Dentsu Aegis Network points out, “Whether it was the recent ad boycott or earlier instances in similar vein. all tech companies have a significant responsibility towards not becoming a platform for hate speech, fake news or other safety related content. This problem is too big to be manually addressed and tech companies are aware they must use technology to tackle this. Ad boycotts are not solu- tions but wakeup calls that must be taken extremely seriously.”
More than 1,000 companies had boycotted Facebook in August 2020. Unilever’s former CEO Paul Polman even said that if Facebook did not address this problem, it may be have to be visited in the “graveyard with dinosaurs”.
The Content Conundrum
Content is a massive concern area for Facebook. To inject credible, cultur- ally relevant and timely content, Facebook took on the partnerships route very early on and has recently focused on licensed content from genres such as cricket, music, cinema and also political content. “On both Facebook and Instagram, people should find good content serendipi- tously. Publishers are interested in our ability to surface this content, and users engage with this better. Increasingly, there is also growth in video content,” remarks Manish C hopra, Direc tor & Head, Partnerships, Facebook India.
Chopra explains that Facebook’s strategy has primarily been focused around trying to create interactive engagement approach on how people spend time. “The content that works well on Facebook and Instagram is around conversation and connection. It is not passive but interactive. We have seen this grow not only on Facebook but also on Instagram with IGTV (Instagram TV).”
While this was one route to bring in credible content, Facebook doubled down on its content policies to address ‘ bad content agents.’ Following its global guidelines and under the watchful eye of Ankhi Das, Director, Public Policy, Facebook - India, South & Central Asia, Facebook has taken some rigorous steps for its content policies. At present, Facebook has not only put machine learning, intelligent algorithmic interventions and AI tools to work but also has a team of over 35,000 people globally to review violations.
Facebook’s approach to this is three-tiered. “We have to keep our product policy updated to address new challenges. For example, we are now going to disable accounts that comment with egregious rape threats. The second is enforcing the policy with right partnerships with relevant regulatory bodies, and the third is education,” informs Das.
For fake news, Facebook has part- nered with eight third-party fact checking organisations in India, thelargest number in a country, to flag bad content. It also ran a mass media campaign during Covid called ‘Share Joy, Not Rumors’ as it was taking down fake content.
The Fierce Road Forward
Partnerships will continue to play an important role in Facebook’s India game plan. Apart from Jio, it partners with Airtel and Vodafone Idea, with developers, news and media compa- nies and sports organisations.
Jio’s role in bringing the next 500 million people online makes it an attractive partner worthy of a record investment. While the WhatsApp and Jio Mart handshake is to fuel the small business ecosystem. Facebook India boss believes “there will be other areas to partner, where the two companies can work together to move the needle for the ecosystem”. But the relationship with Jio would be col- laborate and compete. “We know where we are collaborating now, but if we have to compete, we will compete as well,” Mohan adds.
Inclusions will play a major role in Facebook’s way forward in India. One part of this is gender and the second is financial. Hoping to get approval for payments on WhatsApp, Mohan says, “There is no platform more deeply immersed in India like WhatsApp. Lighting up payments will open financial inclusion for people in smaller towns and villages.”
In Mohan’s words, one good thing can lead to others. Sometimes it is unpredictable, but in the arc of where the country and the digital economy is headed, these changes have the potential to unleash extraordinarily positive forces. And Facebook has poised itself to be cen- tral in this narrative.