Offline Market Is Here To Stay, Says Payback India’s Rijish Raghavan

Despite online businesses penetrating as far as smaller cities in India, offline market will continue to have its presence in the Indian market, says Payback India vice-president Rijish Raghavan in an exclusive interview with BW Businessworld’s Rajguru Tandon.

Payback is India’s largest multi-brand loyalty programme that provides associated loyalty benefits to customers as well as clients. Set up in 2010, it boasts of over 60 million users and more than 50 online and offline partners. ICICI Bank, Hindustan Petroleum (HPCL), Big Bazaar, BookMyShow and MakeMyTrip are some of the big brands that have joined hands with the service.

“The retail sector will have its place under the sun. Digital transactions might be the norm today, but there will be customers who will go for offline as well. There is a shift in business with customers moving to online but it is not a significant change… it has presence in both segments. Offline businesses are not confined but retailers are moving to online as well,” Raghavan says.

Payback is controlled by Loyalty Partner GmbH, a subsidiary of American Express. Though there are loyalty programmes such Paytm, JetPrivilege, Shoppers Stop, the enterprise has an advantage of association with multiple brands. Shopping using a Payback membership card could earn you points which can be redeemed from their other partners through a unique ID.

Scope

Digital marketing depends on certain factors such as internet penetration, and connectivity contributes to consumer experience. If the online experience is good with discount offers and payback policy, it can certainly be a game changer on mid- to long-term basis.

The retail market size of India is roughly $650-700 billion (Rs.4-5 trillion). It could go up to $1.3 trillion by 2020. Every retailer would want to come out with loyalty programmes in future to attract and retain customers. So, the space is an open playground and India is just scraping the tip of iceberg while loyalty is a mature phenomenon overseas.

Payback is known for large partnerships. Partners integrate loyalty in a way where customers are able to earn and redeem points in their neighbourhood. Partners in every sector in the industry believe 70 per cent of the expenditure is captured through large retailers. But to indulge the other 30 per cent, they are trying to capture it through neighbourhood programmes.

The programme has presence in Tier II and Tier III cities. Customers are not directly enrolled but get associated with them by shopping with the retail outlets. Companies such as HPCL, ICICI and the Future group have a large consumer base, which makes it present across the length and breadth of the country.

Roadmap

Speaking about entrepreneurship in India, Raghavan said, “Loyalty is more of a metro city phenomenon because of more shopping opportunities but online makes up for in Tier II and III cities. There is a lot of entrepreneurial instinct in India with people coming up to try different things.

“Most of the campus recruitment happens through new-age start ups. A lot of investment goes into bringing out the right ideas, and support from the government makes up for success of an entrepreneurship. I think the atmosphere is right and lot more can be achieved in this area.”

Payback plans to add more partnerships in aviation, healthcare and telecom sectors, with special focus on acquiring partners to give depth in scale and multiply customers’ ability to earn.