MARKETING STRATEGY DEVELOPMENT OF MOBILE MONEY SERVICES IN INDONESIA

• Main Author: Hyacintha Safira, Bianda
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/78697
• Institution: Institut Teknologi Bandung

In August 2014, Bank Indonesia launched Gerakan Nasional Non Tunai (Non-Cash National Movement) to increase people’s awareness in using non-cash payment instruments in order to create ‘less cash society’ within the nation. Out of 250 million people in Indonesia, only 30% of them own bank account which is relatively low compared to cellular phone penetration that reached 123,1% in 2014. Learning the fact, Telkomsel launched its mobile money, T-Cash so that customers can make financial transactions using mobile phones. However in its implementation, mobile money in Indonesia still has some issues, including low growth rate of mobile money transactions, low awareness, and tight competition with other e-money issuers. This research is conducted to understand the business environment of T-Cash in Indonesia and to develop a business and marketing strategy for T-Cash Tap, Telkomsel’s new product innovation for in-store purchase payment in order to increase its customer usage. Qualitative approach is used in this research by conducting interviews to mobile money players and e-money consultant as well as customer survey. In addition, secondary data is also used to support the analysis which taken from published reports, journals and articles regarding mobile money. Following the management strategy process, environmental scanning was conducted before formulating the business strategy using SWOT analysis, TOWS matrix, Porter's Generic Competitive Strategies, and Blue Ocean strategy as well as marketing strategy using STP and marketing mix. Five methods were used for the environmental scanning: General Environment Analysis, Industry Analysis, and Competitor Analysis for the external environment and Resource Analysis and Value Chain Analysis for the internal environment. Based on the environmental scanning, the political and sociocultural are the factors that have not fully supported the development of mobile money while the economic and technology factors are the contributive factors to the industry’s growth. Telkomsel is currently directing the company towards digital lifestyle and TCash one of its value-added services that support this motion. With its reliable resources, the company is able to run its business activities which enhance on the marketing and sales activities. Since the attractiveness of e-money in industry is relatively low, Telkomsel is expected to offer a unique and innovative product than others. Therefore, the suitable business strategy based on Porter's Generic Competitive Strategies is differentiation which combines uniqueness with broad target. The utilization of NFC technology for T-Cash Tap is a uniqueness that differentiates T-Cash from other e-money services. Due to the restrictions applied, T-Cash Tap is currently focusing on middle-upper pyramid, particularly those who spend up to 10 million per month for private consumption. With the positioning as a modern mobile money that provides easiness and practicality for its target market convenience, the marketing strategy for T-Cash Tap emphasized on socialization and promotion activities as well as merchant partnership and EDC installments. The company can reach the target market by opening booths at malls, merchants near office buildings and campus, and at sport, music, and fashion event. Promotions are also suitable to attract more customers by offering discounts or special price. Also, it is more effective to add EDC installments at restaurants, cinemas, book stores, fashion stores, and gadget stores. At the end of the research, a new business model is recommended to be implemented for T-Cash Tap.