Freecharge is a major player in the e-payment world. It is a one-stop portal for carrying out online payment transactions for mobile recharges, DTH, data cards, prepaid cards etc. Ever being started in August 2010, it has continued to grow in terms of popularity and expand its consumer base. It captures purchase behavior and brand preferences of consumers and offers them discount coupons and incentives to transact on its platform.
The several reasons responsible for the exponential growth of Freecharge can be pointed out as follow:
-Convenience of recharge
-Huge untapped market
-Free coupons- virtually free recharge
Internal and external factors:
- Strengths: Being different and unique is key to faster business growth. Freecharge gets its uniqueness and ‘out of the box theory’ by being the Pioneer of Coupon distribution in India. Being in the core business of coupons, Freecharge gets to be a unique player in online recharge market. A patent has also been filed by it for this business model. No other online player or not even any telecom company has its focus converged on this genre of business style. The reach of Freecharge has increased from 17% to 30% in the past year. On the other side, the ease and convenience of online recharge payments are extremely easy and fast. You are just a few clicks and second away from getting recharge done through your phone. What more could one ask for? Cashbacks, exciting shopping, movie offers add spices to the flavor.
- Weakness: Freecharge lacks direct marketing and often rely on intermediary sources for business. Additionally, Freecharge has a low margin of the business. According to Kunal Shah, Co-Founder of Freecharge “low margin has always been a problem for Freecharge”. Increasing copy cats in the markets have resulted in the narrowing down the source of margins for Freecharge. Even being the first to introduce coupon business in India, Freecharge has always struggled at keeping its low margin problem at bay. No to forget, having stiff competition from Paytm has also affected the business of Freecharge.
- Future prospects: No doubt, Freecharge is doing well with its business lately, but the fact is, a successfully running business needs continuous innovations and out of the box ideas to develop further. The scope of expansion for Freecharge is vast. Freecharge can engage itself into another mode of business as well, in parallel to the existing business. After being acquired by Snapdeal, Freecharge has grown at much higher rate has already got a bigger consumer base now. Further additions to payment services will also attract more crowd towards it.
Freecharge mostly focuses on youth. Since youth is more exposed to emerging technology and services, Freecharge works on continuous improvisations and inclusion of advanced services in its payment scheme to attract the youth and grow its business. Coupons for restaurants, retail outlets, and movie tickets adds to the magnetic strength of Freecharge as youth always look forward to getting more for what they pay.
Freecharge aims further to increase more registrations, recharge frequency, shorten recharge period and motivate the existing customer to use premium coupons more often.