India Inc. is eagerly waiting to see the impact of demonetization thanks to the government’s effort to bring in a cashless society. Although the move can give a boost to the IT sector, all depends on the swift response of businesses especially the SME and MSME segments to stay connected for cashless transactions. This point requires more explanation that calls for in-depth research on consumer preferences to use IT, the inclination of businesses to embrace IT so that they won’t be left out in the competition unleashed by established players who are smartly leveraging IT.
To understand in simpler terms, let us analyze cash. Cash is all about buying and selling. When cash is eliminated in the buying and selling process, IT steps in. This automatically amounts to more IT intervention in our day-to-day lives. But there comes the willingness and agility of businesses to leverage IT for customer connect and profit maximization. Businesses offer products and services; customers want to use the same. The established businesses anyway have their customers who have changed their preferences to go cashless. They are the top layer of the pyramid who don’t need to be in the queue for cash in banks or ATMs. We are focusing on the micro-segment as they are the ones who are facing the challenge. These small players used to do business with cash or credit with the known customers whom they have been comfortable with. So, in the absence of cash what the consumers will do? One scenario is they waiting for cash to come or change their purchasing preferences to do business with large players. If this happens demonetization will overkill the micro traders.
On the other hand, if they take a proactive step to retrieve the customers who were doing earlier transactions with them, the micro sector can stay afloat in the demonetization 소액결제현금화 tsunami. It is in this process, IT can make an impact, but for this, great marketing efforts are needed.
Let us analyze relevant sectors affected by demonetization one by one.
Advantage Digital Marketing & E-commerce
In the earlier scenario, the MSME segment was not that enthusiastic about digital marketing efforts. But in the changed scenario, if small businesses want to survive, they need to resort to digital marketing and e-commerce where sales conversion can be done in mobiles and payment comes directly to the bank account of the micro business. For example, in the case of Kirana stores which was not doing much digital marketing, have to place their ads on products and services, display Facebook page link, or website address link to tell the customers, how they will be benefited if they buy from them. In this process, there are millions of micro businessmen requiring digital marketing services and e-commerce.
Of course, this is challenging as digital marketing and e-commerce in vernacular languages are required to tap the new customers. This means people should be educated, small traders need to be connected with immediate effect. But who will take the initiative as these call for massive investment? I personally feel the best way out is to empower digital marketing agencies by the government to make things happen faster. If not, what will happen. The longer the wait, the faster the death of micro-segments. The bottom line is, of course, there is a great opportunity to bring in unaccounted wealth to countable wealth, where the government gets more revenues in the form of tax.