Ecommerce firm POP said it will launch a marketplace with a curated set of new-age digital first brands where users can get discounts using reward currency.
The company said it aims to build this D2C marketplace via a no-frills approach, enabling brands to benefit from deeper data and insights as well as POPcoins.
“The digital acquisition through facebook or google is getting expensive and consumers spend 40 to 50% of their top line to get traffic. And marketplaces are also getting insanely heavier or more crowded in terms of discovery. In both the cases, there is no right channel for them to get the right customer at a relatively lesser spend. So the problem is very, very topical and it’s burning,” Bhargav Errangi, founder and chief executive officer of POP told ET.
Errangi, a former senior director of Flipkart, has a track record of scaling loyalty programs like Payback and Flipkart Supercoins.
Since its launch in early May last year, the company has already roped in 140 brands on its network, offering its rewards currency POPcoins and replacing traditional loyalty programs and points system. POP’s currency can be redeemed across various brands, similar to an alternate form of payment currency during shopping.
The company said it is also bringing loyalty to everyday payments as well through its own UPI. The POPcoins can be earned through POP’s own UPI handle by making daily payments and transactions and users will get 2% back in the reward currency on every UPI transaction.
“ We are bringing in everyday payments and commerce of D2C together on our marketplace app, which is going to be a game changer. What it does is bringing in a daily engagement model onto the app that you can earn coins on. So if you don’t have enough coins or if you want to increase your coin balance, you can actually do UPI through us instead of a phone pay, Google Pay or Paytm and earn currency which is equivalent to one coin, one rupee on every UPI transaction you do,” he said.
The surge in online purchases post-pandemic has led to a rapid rise in online-first D2C brands, particularly in personal care, food, and apparel. However, this growth has intensified competition, resulting in bidding wars for advertising space online. Consequently, customer acquisition costs have skyrocketed as brands vie for visibility. While platforms like Facebook, Instagram, and Google Ads have been go-to channels, they have become saturated, making it challenging for brands to stand out without a significant increase in advertising expenditure.
D2C brands such as Perfora, Slurrpfarm, Anveshan, and Khadi Essentials have joined the network, and their loyalty constructs are powered by POPcoins.
“We are creating a ubiquitous shopping currency. All these brands adopted our currency are on our network. So, it technically means that if you go to any of these brands’ websites, when you purchase a product from their website, you get Popcoins and you can leverage those Popcoins across the network of other brands that we have. Or you can purchase from the same brand itself if you want to. It’s a customer’s choice at the end of the day,” added Erangi.
With POPcoins, consumers can overcome the confusion of unstructured loyalty programs and earn and shop across brands on the POP network using POPcoins. This initiative simplifies and unifies loyalty programs across India’s brand and business ecosystem, providing consumers with a rewarding shopping experience, it said.
In the evolving landscape of loyalty programs, POPcoins draw inspiration from models like Flipkart’s Supercoins and Tata Group’s NeuCoins. Since its beta launch in May 2023, POP coins have engaged over 1.5 million customers within the POP network, which is expected to grow to 10 million by March 2024.
If the third largest UPI payment app further loses market share, there is a high chance that the likes of PhonePe and Google Pay will benefit, skewing the market share dynamics even more, industry insiders said.
