Hike app the valuation of which is $1.4 Billion, on 14th January 2021 this app has totally shut down. Its over! Bye bye! Tata, gone! So friends, today we will see 5 such reasons behind the failure of hike app which was known as super app. Let us quickly start today's video. Hike messenger was started in 2012, and its founder is Mr. Kavin Bharati Mittal. yes, its a familiar name since Kavin Bharati Mittal .
Is son of Sunil Bharati Mittal. Sunil Bharati Mittal is the founder of Airtel which is a very big telecommunication company now. Hike got total funding of $261 Million. And this had become a unicorn start up in 2016 means their valuation has crossed 1 Billion. The start up which had 35 million users and today it has only 2 million users. We will find out why this start up failed despite .
Of such great innovations. So the first reason is Selective Targeting. They kept their targeting very selective. When a company targets its customer then then few factors play major role. First factor is Value Proposition. Ultimately what is the value that you are providing to your customers. Second is Pricing; which plays very important role .
That whether you sell for low cost or for high cost. Third is which type emotions do you use to attract your customers? Which is very important factor. Customer comes to you because of emotion only. Fourth is age group. Which specific age group you are targeting? And this was a particular factor where they committed a huge mistake. Now what was that mistake? .
Hike targeted specifically 18 to 23 age group, youngsters, as their customers. Now you would ask where was the problem? Problem occurred when they were doing this they ignored rest of the population. And with this, all their decisions whether of marketing, of product innovation all were very specific, were very niche. However all of us know that messenger is everyone's .
Need, buddy; messenger is a mass product and if you try something like this with a mass product then too much problem is created. Now they should have identified this problem very early and should have fixed it. Now brother, without fixing the problem if you keep thinking then how would it work. Now, let us try to understand one point that Business is not for excuse makers. .
You can't make excuses. If we understand carefully then they innovated a lot. They focused so much on innovation but today only innovation is not enough to run business; we have to observe market very closely. We have to check what actually is required by the consumer, which they neglected. The one who observes and serves make a pot of gold. That who sees what is needed by customer, he earns .
Maximum money. If we talk about WhatsApp which was their competitor, what did it do? It observed the market very closely. They targeted all, not just specific age group. Their software was very easy to use. And if we talk about consumer behavior then WhatsApp focused a lot on it. And that's why, even though WhatsApp didn't become super app but it was still acquired .
For $19 Billion by Facebook. So the second reason is too many features. Hike had added so many features in their application; if you see Hike application then they had added games in it, there was checklist, messaging option, payment too. And Hike was famous because of its stickers. Yes the same stickers that you send to your friends and get a feeling of kick, exactly. .
They had innovated so much and developed a good product as well. They continuously kept on innovating and they kept on adding new features. And at certain instant Hike had become a super app. You would say, where did the problem occur then? The problem was that, Hike did make itself a super app but people didn't understand how to use it. It was very complex for people to use so many .
Features all together. Then people were in big problem, that what should we do? If we look at Hike closely then it is actually a copy of a Chinese application We Chat. We chat is like China's WhatsApp to be very honest I am saying like this because We Chat is market leader in China. We Chat has the largest market share. The reason is all the apps like WhatsApp, Facebook, .
Instagram are banned in China. That's why app like We Chat is so famous in China. But if we talk about Hike and consider India then all these apps are not banned in India and Hike did create a super app but but they did not receive the response they expected from people because all these apps are available in India. So the third reason is Large Application Size. .
Now, buddy if you keep adding so many features in such a small app then what will happen? The size of application will increase, its a very simple logic. Hike didn't care about all these things, they just kept on adding features. If we talk about WhatsApp which is competitor for Hike then its application size is just 28 MB. Whereas application size of Hike is nearly 75 MB. You may say that 75 MB is not too much .
Its a small size, it will not make much of difference. See, I am talking about 2012 in India, at that time there was no such advance technology. All users did not have 4G phones, phones did not have storage space of 128 GB. All these things were not available, even Jio entered much later in India. After Jio entered in Indian market, the internet penetration has increased. .
If you carefully study this chart then internet has grown after 2016. Brother, people didn't have access to data so everyone said, no brother, we won't use Hike. People decreased the usage of Hike, and their user base gradually decreased. And people preferred other applications such as WhatsApp since they saved data with it. Next reason is no USP. .
What does USP mean? USP means Unique Selling Proposition means what is the unique facility provided by company that no one else is providing. If we talk about Whatsapp then what is their USP? Whatsapp is known for its messaging. It is very big messaging platform. If we talk about Facebook, what is their USP? Socializing, you can socialize with Facebook. .
You can make friends all over the world. And if we talk about Instagram, what is it known for? You can share photos and videos on Instagram. Now reels are also there, which are short videos. If we talk about Snapchat then what is their unique feature? You can share photos, videos without saving them on your device. All these apps have some unique feature, but Hike has added all these features in a single .
Application, they don't have any unique feature of its own. That's why Hike couldn't create particular image in consumer's mind because of which they just kept surfing here and there. Now a great CEO, Jack Welch says that If you don't have competitive advantage then don't compete. No need to compete if you don't have competitive .
Advantage; you can't do business by forming such a cluster. Today, if we talk about Whatsapp then it has observed that there is complete internet penetration in India and Whatsapp has added all the features which were there on Hike. Today Whatsapp has stickers, payment option, video calling, voice calling all the features are added by Whatsapp as it knows that .
Now customer needs them and they can access what I am providing. Their biggest mistake was no proper revenue model. They didn't at all focus on where the money will come from, in business. Always remember one thing Charity is never scalable. You can't scale business with charity. If we talk about their competitor Whatsapp then it charges Rs. 59 per year to its users. .
And if we talk about India, then yes, I agree that Whatsapp is free. But how did Hike earn money? Hike was earning money through data. The money for data, which was used to send the messages, was given to Hike by telecom companies. Then Jio entered in Indian market and with Jio's entry, data was available for free. A big company like Airtel which was a big investor in Hike, they also suffered then why do you think .
That Hike could have survived in this scenario? Hike app which had more than 100 million downloads & today it has less than 2 million users. No one wanted to use the Hike app and now it is totally shut down. Many things must have been clear with all these points, and the most important point would have been that only innovation is not enough to run the business; those who think that just with .
Innovation they can run business then it is not like that at all. I hope that you must have enjoyed today's case study. I have especially used a book to create this case study which is Leadership at Scale. This is fantastic book and it contains many such principles with which you can start a business from scratch and can make it a huge scalable business. .
Many amazing principles of leadership are given in it; if you want then you too can read this book I have added the link in the description. Do let me know what you felt about the video. And also give me suggestion if you have any ideas regarding the next video topics. I will see you in next video, till then take care.