Business Plan

of
Hike messenger

Submitted by: Group13

Nishikant Singh(Pgfa1438)
Prabhat Lohani(Pgfa1439)
Prerna Verma(Pgfa1440)

Hike messenger
Delhi-110003
India
Get.hike.in

Partners: Bharti Enterprises, Softbank Corp.

Description of Business:
Hike Messenger is a cross-platform instant messaging service for smartphones that uses
the internet for communication. In addition to text messaging, users can send each other graphical
stickers, emoticons, images, videos, audios, files, voice messages, contacts and location.

Financing:
Hike was launched on 12th September, 2012 and raised its first round of funding of $7 million from
BhartiSoftBank in April 2013.In August 2014 hike raised another big round of funding - $65 million led by Tiger Global.

This report is confidential and is the property of the partners listed above. It is intended to use only
by the persons to whom it is transmitted, and any reproduction or divulgence of any of its contents
without the prior written consent of the company is prohibited.

Executive Summary
Vision: To become Indias fastest growing mobile app and to bring India's one billion potential
mobile Internet users online through their messaging platform.
The application claims to have tailor made its features keeping in mind the local market and to cater
to solving cultural and infrastructural problems such as lack of privacy, inconsistent data connectivity
amongst many others. This exercise has contributed positively in taking the popularity of the app to a
new level.
Some of the key features of Hike app are as follows:

Offer smartphone to feature phone messaging option

Allows users to share any file format up to a 100MB each

Only app to offer localized stickers and 2 way chat themes

Hike offers messaging in three different ways. Hike-to-Hike messaging with other phones is
unlimited and free worldwide. Second, you can communicate with other smartphone users who
don't have Hike via SMS, which is only restricted to India at the moment. Finally, you can
message any other phone user via SMS.

Revenue Model: hike has three major sources of revenue: free-to-play video games that make
money from in-game purchases of virtual items and other services; stickers featuring cartoon
characters that users buy and send as messages; and official accounts for businesses and
celebrities who pay fees to send a set number of promotional messages.

Technology: Hike uses a 128-bit SSL encrypted, firewalled server for all its media exchange
and text communication via Wifi only. One of the most significant feature includes is data is not
backed-up to Hikes server and is dynamically stored in the users device.

Target Market: The target market of hike messenger is segmented to those active internet users
who lie in the range of age of 15 to 25 years.

Background and Purpose

BhartiSoftBank, of which Kavin Mittal is the head of strategy and new product
development, is owned equally by Bharti Enterprises, the holding company of the
Mittal family whose stake in BhartiAirtel is worth over $15 billion, and SoftBank
Corp, the Japanese technology giant. Hike is a subsidiary of this company in which
Tiger Global, the New York-based investment firm, invested $65 million in August.
Launched in December 2012, Hike had reported over 35 million users in August,
2014. It has raised $86 million from Tiger Global and BSB, so far. Most of its user
base is under the age of 15 and residing in India. Some of its popular features are
Hike Offline that lets you message your friends even when theyre offline, Hidden
Mode that hides your private chats with a password and also several regional
stickers.
The free Hike calling feature is currently in beta on Android, as the
platform contributes to over 90 percent of Hikes user base. The company plans to
roll out iOS and Windows versions by the end of this quarter.
Target goals:

To attrachindian customers aged between 15 to 25

To build an app that will give privacy to youngsters in the market.
To cross 100 million users within 18 months

Objectives of Hike messenger

Hike objective is to bring India online by building through messaging. In a country where 1 billion
people will come on to the internet mobile first on a low-end smart-phone and 2G/pre-paid data, Hike
believe messaging can become a highway to the internet. Objective is to further localize Hike

and not just in terms of content but go really deep in the market and solve more
problems local to India.
Hike wanted to build an automation platform that ca take care of rapid pace of
building product. Hike decide on building framework at every level of department
(client side , server side, scalability, load, database and overall matrix

Some of the points of automation objectives are:

1.

Hike want to build a framework that uses almost same test scripts and
reusable components for both Android and iOS. The only prominent
difference is of object repository, otherwise both platforms go hand-in-hand.

2.

Tests could be run on more than 1 device in parallel. Since Hike is a

messaging app, this feature was the most important requirement. So two
instances of android devices or two instances of iOS devices or combination
of android and iOS devices interacting with each other in parallel.

3.

Supports multi programming languages like java, python, nodeJS, etc.

Hike chose good ol JAVA!!

4.

Runs well with all Android API levels .

5.

Appium uses Selenium Webdriver APIs to interact with devices, so it is

much easy to write scripts if you have any experience with selenium. It also
supports various touch gestures to simulate user interaction with Android
and iOS like swipe, double tap, long press, etc.

6.

Best part is, it is well integrated with Jenkins Which means with single
button click (or with every dev checkin), we can know about apps health.

Market Analysis

The no#1 APP of India

Hike now hit no#1 app on android and ios ap store. Hike have displaced tonnes of other
popular apps including the world biggest messaging app whatsaap , social network
facebook and games candy crush saga .Hike is now the fastest growing mobile app in
India amongst the entire lot adding more than 300 hikers every day
Hike is built with India in mind and its so glad to know that many of people moving onto
Hike, Indias own messaging app and bringing your friends on board

Market strategy:
1. Keeping the Indianness intact: While many India based small companies
and start ups, deliberately underscore their LA Office, Hike did the opposite. It
always stressed on the fact that it is completely Indian, which I guess, hit on the
emotional chord of us Indians.
2. Differentiation: One of the things that Hike very consciously did was to
differentiate itself from WhatsApp. If it would have been another WhatsApp,
nobody would have used it. Hike brought in the read indicator, hid the last
seen, themes for chats and file transfer was expanded to more formats are the
few on the top of my mind.
The sms functionality specifically stands out in the Indian market. We Indians
are frugal people. We turn off the data when we dont need it. In such a case the
Hike sms came in quite handy and the cherry on the cake was the seamless
integration and no cost!
3. Localization: The stickers Hike introduced stuck resonance with the Indian
way of thinking and emotions. The Indians and Bollowood tabs were in fact
quite interesting. Things have been made even better and addictive by the recent
update of State wise stickers. I have lived in 5 different states as of now and I love
the local lingo these guys have picked up in these stickers.
4. Conventional Media: The TV commercials (though I dont like Hikes TVC
quite) but it enabled more traffic flow to the app. The market segment (which we
call late adopters and laggards in marketing lingo), joined in after watching the
TVC. Advertising mobile apps on TV had already failed for WeChat, Line and
others,still Hike did it and still made marketing profit from it.

Market size: The market size of Hike messenger is around 35 million in a very
short duration of 2.5 years that suggest that the growth rate is very high . It is because
of the increase in the user of smart phones as well as the new trend the people are
following. The company is continuously raising funds for its overall development like
they have raised 14 million last year to improve their services and add on new features.

Target Segment: The hike company main target segment is the youth .people that are
below age 25-30 are their real users In this category there come college students some
office professionals
Success Factor: The success factor of Hike is first their research and development
team which brings such a unique product with unique features like support for other
Indian languages, shares files easily and hiding the last seen etc. Their research team
do a lot of research before launching this. Other success factor is the marketing team
which promote Hike so much that today Hike is giving a tough competition to Whatsapp
and become a no.1 messaging app in India.

Development and Production

India's Home-grown chat application firm "Hike Messenger" has just acquired USbased voice-calling company Zip Phone, a Y Combinator startup. Hike is planning to
launch free voice calling soon, and this first acquisition by the Indian company is a
step in that direction. The acquisition is aimed at expanding Hike's product range in
the Internet-based communication space, the company said, declining to disclose the
acquisition sum. "Zip Phone's technology will allow us to bring free voice calling to the
market much faster.

Introducing hike direct cash transfers

Hike goal has always been to connect people across boundaries; close friends, families
in a simple way without any complexities or restrictions. With technology we believe we
can enable people to live their lives and connect with others far easier than before. As a
result, weve always strived to push the envelope and have tried

Hike Messenger Updates App With Language Support, Offline

Messages, Voice Messaging
The 2.2.0 version of Hike adds features like stickers, walkie talkie, offline messaging
and support for four new languages.

Hike to Tie-up with Airtel, Vodafone & Idea

The battle of free messaging apps over Internet has reached to mobile operators too.
In recent time India becomes a focus point for the messaging apps and VoIP apps like
WhatsApp, Skype, WeChat, Nimbuzz or Hike. In the latest development instant
messaging app Hike, developed by Bharti SoftBank is in talks with incumbent players
Bharti Airtel, Vodafone India and Idea Cellular to come up with special bundle packs
for Hike app.

Offline Feature, Push To Talk and Privacy on Preference

With Hike offline people will be able to communicate with their friends on hike even if they
dont have Hike app installed. That is through SMSes. And more amusing is that the replies
wont be sent to the friends inbox but in the same message thread under the Hike app.
Even if phone battery drains out, Hike will save messages and will display it again when
phone is turn on.

Privacy
Hike uses a 128-bit SSL Encrypted firewall server for the exchange of media and text
messages only on wifi. Messages are stored locally in the user's device and the data is
not backed-up to Hike's server.

Marketing Plan
Product
1. Hike + CricBuzz bring World Cup 2015
Hike had launch real-time scores & updates for World Cup 2015 on hike in
partnership with Cricbuzz. Hike designed a beautiful World Cup 2015 card that
will bring you all the latest match updates and scores through the World Cup and
you can share them with ease with your cricket-crazy friends and more

2. Introducing Free Hike Calls

With the acquisition of Zip phone the hike user can make a free voice
call
over 200countries.It includes free calls over 2G,3G,WIFI
3. Free stickers , multi language supporte
Hike introduces new stickers(regional) , walkie- talkie , point messaging
application , free text messages to non Hike users and also supportable for the 4
languages

Pricing
1. Cost effective strategy
Hike introduces the hike messenger keeping in mind the people living standard
here in India. In India people are more concern to save more and more money so
Hike comes up with the cost effective strategy so that even the non Hike user
can use the Hike with his/her hike user friend
2. Reward strategy
Hike paid 20rs per friend recommended by you to join Hike. These tactics,
however, are feasible only in countries with developing economies, as the
conversion rate here is quite less, as 130 INR is around 2.1 USD.

3. Penetration pricing
Hike comes up with the penetration pricing strategy. Hike sets the low amount for
its services charged to customers

4. Freemium
It is a type of pricing strategy in which other services are offered free with the
main service likewise Hike charged money for its instant messaging and other
services like free stickers , walkie talkie and free calling is there to attract and
retain the customers

Place
Hike is

the

Indian

organisation

that

provides

instant

messaging services in different countries. Hike has its

headquarter in New Delhi, India a small organisation with
149 employees .No distribution channel for this organisation

but there are many telecom partners like Airtel, Idea,

Vodafone etc serving as a distribution partners for Hike
messenger
Promotion
Hike involves unique and innovative style of promotion
technique like:
1.Celebrating birthday for Hike users
Hike for its user celebrate its birthday by throwing a big
party to its user and non user. A night full of comedy and
dance by the AIB boys Daniel fernandes and Abis Mathews

2. Promotion on google play

Hike promote its app by sharing it with google play where user can see it
reiew it and finally download it from there

3.Television commercial
For promotion Hike uses the television commercial to attract the user. Hike
use tv ads without any brand ambassador.

4.Charity
Hike raised 1 crore form more than 1 billion Indians adding 10
lakhs from their company fund to the prime minister relief fund
for the natural disaster occur at Kashmir.

Financial Plan
In the year 2012 Hike company freshly invest 7million rupees to run their business
operation after that in the year 2014 they invest 14 million rupees to get advance with
the technology. Tiger Global a New York based investment firm also made the 65$

investment. The company is continuously raising funds for its overall development like
they have raised 14 million last year to improve their services and add on new features.
In the year 2014 BSB Invest $14million to support the development plans of Hike
messenger
In response Hike earn money by promoting other brands. Hike sells its data to other
companies. Their per year income is in million more than $35million.

Ownership
Hike is a messaging developed by Bharti Soft Bank. Hike is a
brainchild of Kavin Bharti Mittal. Kavin is son of Sunil Bharti Mittal
(owner of Airtel). It has raised $65 million from its parent
company and a U.S.-based investor to help expand the user base

of its free messaging app Hike Messenger.The investments are

from New York-based investment firm Tiger Global Management
and Bharti SoftBank , the Indian company said in a statement.
Hike is a joint venture between Bharti Group and Japanese
telecommunications giant SoftBank corp.They have partnered
with companies like: Cafe Coffee Day, Pizza Hut, Dominos etc. The
more you use Hike they will give you coupons as rewards. For an
example: You got 20% off on a pizza at Dominos and the actual
cost of pizza is 200 INR + taxes. You will get that pizza for 160 INR
+ taxes. Now this is a trick. Most people buy pizza because they
had a 20% off coupon. And the same thing goes with other
coupons.
They have a featured Apps section inside their app which
suggests you to install new games and apps. These apps and
games are sponsored by their promoters and developers. Hike
makes profit in between. It's just like advertising your app on
Hike.
But the money they earn from Coupons is very less. They spend
money on Advertisements (TV, Newspapers, AdWords, Facebook),
Dedicated Servers, Message Centers (which let you send free
SMS), App Development, Giving free talk time if you invite
someone, Giving free SMS if you invite someone and they joins
Hike. All in all, they are putting all effort to beat WhatsApp in this
messenger war. They have everything in house. Message Centers,
Free Talk Time, Free SMS all are powered by Airtel. And for the rest
of the things, Airtel is putting all the money.

SWOT Analysis
Strengths

Loyal customers
Market share leadership
No need to log
Group Chat
Allow send videos, pictures, voice notes
You can put profile picture
No need to add friends
No need PIN or user number
Cost Advantage
Available for all platforms
For some platforms is free the first year in order to build
customer loyalty.
Weakness

Not diversified, because other applications offers the same

service and also function as social media
Weak distribution network
To access the account can only be paid by credit card only
Only works with a data plan or wifi .

Opportunities

Continued development of technology platforms

Advanced technology
Recognized application
Modernization of people
Increased demand for smartphones
Video calls to keep customer connected only on one app

Threats
Competitors like Wechat, Viber, Tango, Skype, Line,Whatsapp
Product substitution
Similar applications and free

Time Line of hike messenger

September 2012

Launched in INDIA

November 2012

Hike becomes global messenger app

December 2012

No.1 in Germany

February 2013

No.1 free iphone app in India

February 2013

No.1 android app in India

September 2013

Hike
+ Airtel

December 2013

Turns 1 globally

July 2014

No.1 app

August 2014

Crosses 35million users

January 2015

Free Hike calls(acquire ZIP phone

Assessment of Risk
Weakness of Business(Hike messenger)
Not financially strong
few promotion strategy
No brand ambassador
Weak distribution network
New Technologies
Free calling
Free usage of data pack

 Attractive stickers
All android supportive software
Blackberry as well as I-phone supportive software
Contingency plans
Cost effective
Invest on development
More economical