M-Pesa’s Failure in India: Why Couldn’t Vodafone Replicate its Kenyan Success? An International Marketing Case Study (Addendum by Former and Current Executives at the Vodafone Group)

Vodafone’s mobile wallet service, M-Pesa, was originally created in 2007 for Kenya and was extremely successful in providing millions with access to mobile-based financial services. Essentially, a mobile wallet service enables payments via digital money in the form of mobile airtime. According to industry estimates, the global mobile money market is expected to reach USD 112.3 billion in 2021, with a compounded annual growth rate of 39.6% since 2016. Vodafone launched M-Pesa in India in 2013, but by mid-2019 it had announced its plans to merge its mobile wallet business with an associate company or a third party. Clearly, Vodafone had failed in its attempt to market M-Pesa in India even though India is a rapidly growing emerging market with a gross domestic product (GDP) growth of 8.2% in 2018. Currently over 90% of transactions in India are cash-based largely due to lack of access to bank accounts and low penetration and use of credit/debit cards. This not only hampers business but also exacerbates issues like corruption. India is seen as lucrative for mobile wallet providers due to its large population with growing disposable income, rising mobile phone penetration, increasing number of mobile internet users, government reforms, and government investment in telecom infrastructure. Indeed, the Indian mobile wallet market is poised to grow by 150% to reach $7 billion by 2023. Vodafone had hoped to repeat its Kenyan success by using M-Pesa to target Indians who either didn’t have bank accounts or rarely used them. However, it lost its early entrant advantage, and a host of new start-ups took over the market. The dominant player now is Paytm, the fastest growing mobile wallet in India with a 70% market share. This case study examines Vodafone’s marketing strategy in the context of the competitive, regulatory, and cultural challenges in India. The case questions initiate discussions on a wide variety of issues aimed at uncovering why Vodafone’s M-Pesa failed in India and what it could have done differently. The case study caught the attention of Mr. Michael Joseph, Chairman of Kenya Airways, who was the founder and former CEO of Safaricom, a Vodafone investee. After reading the case study, Mr. Michael Joseph gave an interview to Dr. Mona Sinha, Associate Professor of Marketing at Kennesaw State University. In the addendum at the end of the paper, Mr. Michael Joseph explains why M-Pesa did not perform as well in the Indian market as the company had originally hoped

Toto: A Game of Thrones in the U.S. -- An International Marketing Case Study

Toto is a 101-year-old, world-renowned Japanese manufacturer of high quality, innovative, state-of-the-art, and luxurious bathroom equipment such as, toilets, bidets, washlets, and ultraviolet sanitation equipment (“Our Founding Spirit,” n.d.). However, Toto has been unable to replicate its global success in the United States (U.S.) for several possible reasons (Roberts, 2017). First, by positioning its brand as an exclusive and luxurious manufacturer of high-end technology at a high price point, Toto only appeals to a limited, top-end, niche market, limiting its widespread adoption (Roberts, 2017). Second, Toto believes in environmental stewardship and makes sustainable products with a green supply chain (“Toto and UPS,” 2010). However, given that the United States recently backed out of the Paris Climate Agreement, the market for sustainable products might be negatively impacted (Zhang, Chao, Zheng, & Hueng, 2017). Third, Toto’s target audience includes both business-to-business and business-to-consumers, and economic conditions, housing markets, and individual disposable incomes impact purchase of its products. Fourth, persuading consumers to change their self-cleaning habits and attitudes involves an awkward ‘bathroom conversation’ that either puts off and/or offends (Molotch, 2015). This case study explores the struggles of a sustainable, luxury brand positioned on innovation that sets it apart from the competition but which consumers may not value. The case questions focus on the marketing strategy changes that Toto must make in order to succeed in the U.S

Namaste in the USA: The Growing Pains that Traditional Yoga Faces in America – An International Marketing Case Study

Yoga is a mind, body, and spiritual practice that originated nearly 5,000 years in India. It is known to relieve stress, enhance athletic performance, increase strength and flexibility as well as assist in achieving inner peace, focus, and improving mental wellness. In recent years, the practice of yoga has grown exponentially in the United States with about 37 million practitioners in 2016. However, the future growth of yoga in the U.S faces some critical challenges. American innovations in yoga techniques and the rise of the yoga accessories industry with deep linkages with consumerism, is drawing the practice away from its philosophical roots which emphasizes mental and spiritual benefits. A shortage of qualified instructors is exacerbating this problem. Further, the practice of yoga in the U.S seems to be mainly by females and concentrated largely in urban areas and East/West coast, thus, precluding its mass adoption. Also, although yoga has many health benefits across ages, and many schools have started adopting it, there has been some backlash due to its roots in Hinudism. Anti-immigrant rhetoric is also on the rise, in the U.S. which could have adverse impact on yoga which is clearly linked to India and Hinduism. This case study examines the practice and background of yoga and its rising popularity in the United States. It delves into the many challenges that yoga faces in becoming a part of mainstream health/wellness and fitness industry. Additionally, the case study poses critical marketing questions related to the scalability of its adoption in the United States…a challenge that the Brahmans, Rishis, and Yogis who created this practice thousands of years ago in India could never have foreseen

Mobile Payment Adoption in India: Role of Attitude and Risks

This paper examines the emergence of mobile payments as a payment alternative in India. Despite economic growth, marked improvement in social indicators, and rising incomes and savings rate, nearly 41% of the Indian population remained unbanked. Use of self-service technologies such as ATMs and Internet banking had limited success. Given the high penetration of mobile phones, mobile technology was being seen as a mode of transforming the banking sector and in particular payment mechanisms. Most research on attitude towards technology and its adoption has been conducted in developed countries and their applicability to Indian consumers remained unclear. This paper offers a conceptual model proposing that mobile payment adoption in India will be influenced key technology adoption factors i.e., expectations of performance and effort in using mobile payments, facilitating conditions provided for its use, and social influence. Further, we propose several moderators to this relationship: attitude towards the mobile payment service provider, attitude towards mobile payments, perceived risk, privacy concerns and demographic factors. We encourage researchers to empirically test this model so as to enable mobile service providers, banks, and other financial solutions operators to increase the adoption of mobile payment solutions they offer in India

Three Types of IT Use

Existing research identifies multiple types of uses, ranging from initial adoption of technology to uses that have been described by terms like adaptive system use, enhanced use, etc. Additionally, literature shows that researchers have used different instruments when using similar terms. Together, the lack of understanding of different types of use and the lack of coherent measures for use leads to construct validity problems. In this paper we aim to distinguish between the different types of uses, followed by isolating the key measurement items for each use type. The paper uses a modified Q-sort method to classify the different use measurement items. Findings indicate that there are three types of uses and distinct measurements. This study lays important groundwork for future research into the three types of use and is a first step in creating scales for these use constructs

The Conceptual Foundations of Relationship Marketing: Review and Synthesis

The present review is devoted to a rapidly developing area of marketing — relationship marketing. The authors suggest that the conceptual foundations of it are not currently well developed but forecast that it will transform into a discipline in the near future. They outline two approaches to the definition of relationship marketing and provide their own definition, emphasizing such aspects as collaboration, creation and enhancement of value for those who are involved in relationships. The authors trace the origins of relationship marketing, describing the importance of a range of factors that contribute to the increasing importance of relationship marketing today, such as the development of services, communication with the end consumer, etc. A section of this work examines the development of theoretical approaches: the authors argue that marketing originated in economics, which tended to ignore issues related to distribution systems. They also show that questions concerning relationship marketing were considered even before the term itself was introduced. In the final section, the authors touch upon the models that describe processes in relational marketing and analyze its components step-by-step. The authors highlight three core aspects of relational marketing: setting a purpose, choosing parties and program formation. In the conclusion the authors describe three possible levels of future studies in this area — the concept level, model level and process level — and specifics of each level are characterized