The fuel for business resilience

On a sunny October afternoon last year, Ajit Mohan, vice president and managing director, Facebook India, in a conversation with Fortune India, had talked about social videos and social commerce, mentioning the social media giant’s minority stake in Meesho, a social commerce platform. That was a time when the popularity of social video app TikTok was spreading like wildfire across India, and some people had doubts about the success of social commerce in India just yet. Then, Facebook was looking for new revenue streams and looking to grow its user base. And WhatsApp Pay was stuck in beta mode.

Cut to a little over a year later, and the scenario has completely changed. The great disruptor called the Covid-19 pandemic has ensured that we stay at home and social media becomes our default connection with a host of people. And in this, Facebook’s family of apps have become the mainstay for several small businesses across the country to conduct business. WhatsApp Pay has been rolled out, albeit in a structured mode; and TikTok, owing to the pressures of geopolitics, has been banned in India.

At Facebook’s first ‘Fuel for India’ event, which was held recently, Mark Zuckerberg, the social media giant’s iconic founder, was effusive in his praise about the potentialities that India has offered. “India is a very special and important country for us. Millions of people here use our products every day to stay in touch with friends and family. Whether it’s a WhatsApp message, or a Facebook post, or photos on Instagram. And millions of small businesses across the country use WhatsApp business and Messenger to reach customers, manage orders, and grow their businesses,” he had said. Zuckerberg even went to the extent to say that now the situation has altered to such an extent that Facebook tests some of its features in India first, before they are rolled out globally.

In fact, throughout the two-day virtual event, the preeminent theme which was hammered on was how India was—to borrow the phrase used by Vijaye Raji, Facebook’s vice president for entertainment—the social media giant’s ‘test bed for all things.’ Other themes that were discussed included Facebook’s growing focus on small businesses, and how businesses—both big and small—pivoted during the pandemic, using Facebook’s family of apps.

Fertile ground

In fact, India being the big focus isn’t restricted just to Facebook. Other big tech companies, such as Salesforce, Microsoft, Apple, IBM, etc. too view India as a big market. So a question that must be asked at this juncture is why exactly has this happened. Why has India become the test bed for big global tech firms?

According to Monesh Dange, consulting markets leader, EY India, the reasons are manifold. But the chief among them is the fact that, compared to the rest of the world, in India the cost of innovation is cheap. “India is known to be the land of, I would say, frugality of meaningful innovation. So, we don't spend a lot on innovation, it happens,” he says. For Dange, Indians have an inherent enterprising nature, which makes innovation easier. “It's inexpensive to innovate in India. Besides, I think the user community in India is very happy to experiment. Because they are getting value for money in all the experiments they do,” he adds.

But innovation by itself is not enough. For Dange, innovation should be coupled with a faster speed of adoption of new technology, which is visible in India. “And the third has to be necessity,” he says, adding that “circumstances sort of trigger all necessities. And because we are having to on a national scale and platform, everything happens at such enormous scale. Just the triangulation of these three points, just drives everything.”

For Piyush Sharma, Executive-in-Residence, UCLA, and a C-suite+ and startup advisor, while innovation, adoption, and necessity are important, one shouldn’t forget that the American and European markets have already reached a saturation point. “The American market and the markets in the West are pretty saturated and have already given their best and continue to give the best to these giants.

China is a closed market for them. So the only alternative largest market in the world that remains is India,” Sharma says. He argues that India already has around 400 to 500 million people who have access to a mobile phone and this number is not stagnant, but is forever growing, thereby making the country a fertile ground for tech companies.

Business resilience

At the Fuel for India event, Zuckerberg sang paens dedicated to the resilience of Indian businesses. “A lot of Indian organisations are leading the way, and using technology to build safer communities and more inclusive financial systems. Whether it’s in social commerce, or education or financial services, there is a lot of innovation that happens here,” the Facebook founder said. Zuckerberg also pointed out that a key development to which he was a witness to the way many Indian enterprises fought hard against the economic chaos the Coronavirus pandemic had unleashed. In this, he singled out small businesses, and even argued that the only way for the world to economically recover was if the small businesses stayed on.

EY India’s Dange argues that the pandemic forced Indian businesses to see the ultimate value in going digital. From car retail to logistics companies, to even manufacturing, almost every sector had to pivot to the digital route in order to stay buoyant. “Every business has struggled to remain relevant in the post-pandemic scenario. One of the reactions to the struggle for survival has been the evolution of alternate business channels. And while everybody had it in a very docile form, or in a minimalistic form, I think many of them got an opportunity to digitally innovate the route to market. And that's how you see the proliferation of excessive innovation on the social media side during this particular time,” Dange says.

Similarly, Sharma, using the example of the e-payments market, points out how digital adoption has turned out to be a key survival metric. Sharma says that 2016’s Demonetisation, for instance, had already laid the foundation for massive adoption of digital payment systems. That disruption further gave an impetus to many other digital programmes of the government, such as UPI. “If Covid-19 would have happened to us 10 years ago, imagine where we would have landed. All of digital commerce today is enabled through that very solid pillar, which is a serious secure payment mechanism,” he says. For Sharma, because the foundation for digitalisation was already laid out, once the pandemic hit, businesses had a lot of elbow room, plus preparations, to quickly go the digital way. And the digital payment system was the very backbone of this change.

In many ways, the Facebook Fuel for India event did manage to throw light on the inherent resilience of Indian companies in the face of cataclysmic change. And that resilience will only grow stronger henceforth.