Facebook India gets down to serious business as it tries to go local

It takes five people a month to make a chikan dupatta. The beauty of the embroidery, the poverty of the artisans behind it and the fact that her husband, Vinod Punjabi, owned a business selling zardozi, mukaish and other handcrafted materials egged Rhea on. The Punjabis set up Ada Designer Chikan Studio in Lucknow in 2005. The idea was to support small artisans and create a bigger market for chikan. So Rhea Punjabi turned to Instagram and YouTube, and in 2011 created a Facebook page.
 

“Facebook really helped in creating awareness overseas — Canada, US, UK, UAE. Facebook’s account managers also helped us figure out how to target the ads,” she says. And through its property, WhatsApp, the platform got the Punjabis business as well. (The couple uses WhatsApp for booking one-on-one orders.) Ada now supports 6,000 artisans and chikan has got a wider reach, beyond India.
 

Ada — like CueMath, Okhai, Paper Boat Apps and thousands of other homespun small and medium businesses (SMB) — represents Facebook India’s less familiar face. If Google is the world’s default entry point to the internet and Amazon the default shopping mall, then Facebook is the global café you go to for meeting friends, family, your community of single mothers, golfers and so on. This then is Facebook’s shot at stretching the idea to replicate it in the economic ecosystem.
 

“We believe we are the natural home for small businesses,” says Sandeep Bhushan, director and head of global marketing solutions, Facebook India. “We enable entrepreneurship to add scale and digital access,” adds Manish Chopra, director and head of partnerships.

 

Whether it is helping Ada reach consumers across continents or working with Samsung to train 800 of its retailers or picking up content partnerships, Facebook is on a deal-making spree in India. Last year, it invested a reported $20-25 million in Meesho (a social commerce platform), an undisclosed amount in Unacademy (a learning platform) and also got SAIF Partners, Fireside Ventures and others to be part of its VC Brand Incubator. (Facebook’s VC Brand Incubator Initiative helps SMBs grow by collaborating with venture capital funds.) In April this year came the $5.7-billion investment in Reliance Industries’ Jio Platforms. There is also a slew of content tie-ups with the International Cricket Council, Saregama and the Indian Performing Rights Society to license its music repertoire. July also saw Instagram (another Facebook property) launch Reels, which allows users to upload 15-second videos à la the banned TikTok.
 

“Our fundamental growth comes from connecting friends and family. All the deals we do are from that prism,” says Ajit Mohan, vice-president and managing director, Facebook India.
 

The Facebook adda
 

For the $71-billion Facebook Inc more is always merrier: more people means more engagement and, consequently, more advertising. Globally, over 2.6 billion people use Facebook every month; 2 billion are on WhatsApp; and over a billion on Instagram. And India brings in the largest community to this party. In 2019, more than 328 million Indians used Facebook every month. And about 400 million are on WhatsApp.
 

This has prompted the remodelling of Facebook India. Soon after Mohan joined, in January 2019, India became the only country (out of 60) to start reporting directly to the headquarters in Menlo Park, California. Financially, however, India remains a minnow, bringing in about $387 million (Rs 2,900 crore), which makes for just over half a per cent of Facebook’s global revenues. “The revenue story is inconsequential for now. We are here for the long term,” says Mohan. “Facebook in India is a pioneering experiment for a tech company building products and platforms. There is a massive opportunity to pilot and build models that can be replicated abroad.”
 

There are three things driving the India strategy. One, creative expansion and making it easier to build communities around it.

Two, fuelling entrepreneurship. Three, using payment over WhatsApp (which is pending approval) to play a role in financial inclusion.
 

Bhushan explains: “It is estimated that small businesses make for 30 per cent of India’s GDP. If we want to have an impact, then we need to focus on them. There are an estimated 50-60 million SMEs. One of the biggest services is to allow SMEs the same reach as large businesses. You can reach, say, 50,000 consumers who are the target. Facebook, Instagram and WhatsApp can support every instance of their communication. For example, you could start the conversation on Facebook and complete it on WhatsApp.”
 

India has a special position, given the role WhatsApp plays. “All businesses use WhatsApp — tailor, grocer, even the Vodafone consumer. The India opportunity in business lies in talking to current and prospective consumers. Jio Mart, for instance, has potential for kirana and grocery,” says Bhushan. In March this year, Facebook Inc announced a $100-million grant for small and medium businesses. While the amount is meant for 30 countries, India is key.
 

Facebook also offers a whole lot of software tools and support services to small and large businesses trying to figure out how to use its products.
 

Hyundai, Vodafone, Cadbury, among others, use its capabilities to either connect with consumers or business partners. Each business connects with hundreds and thousands of people on Facebook, making it more tempting for advertisers.
 

Does the need to get more people on board explain the content deals for cricket, music, news, entertainment and so on? Will Facebook India be commissioning content? “No. We’ll not be commissioning. We will only work through partnerships (with media, mobile and other firms),” says Chopra emphatically. He points out, “The video that shines on Facebook is fundamentally different. We don’t open Facebook or Instagram to see a video, we discover it serendipitously.”
 

The opportunity does not lie in another commissioning service but in connected video, social video. Video views on Facebook have grown exponentially since 2016 when Jio took off, and “India still has 300-500 million people without smartphone,” says Chopra.
 

So the potential this ecosystem offers is immense. The journey has only just begun.