Paytm: Targeting More Pockets for Its Mobile Wallet SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Paytm: Targeting More Pockets for Its Mobile Wallet
Paytm enjoyed a position as the leader in India's market for mobile wallets, a digital service that enabled payments to be made through mobile devices. Paytm's major client, Uber, which developed and operated a smartphone-based, ride-hailing app as a way to compete with traditional taxi companies, had initially used Paytm's mobile wallet as the sole payment mode for Uber rides in India. However, in 2015 Uber revised its payment policy by adding a variety of payment options, such as debit cards, credit cards, and the addition of several other mobile wallet providers. Did Uber's strategies and plans represent a major concern for Paytm? Amid such changes in the highly competitive digital payment industry, what strategies should Paytm adopt to expand its own offerings and maintain its position as the market leader? What other options could the company pursue to ensure its sustainability and continuous growth? Sandeep Puri is affiliated with Institute of Management Technology, Ghaziaba.
Swot Analysis of "Paytm: Targeting More Pockets for Its Mobile Wallet" written by Sandeep Puri, Shivani Upadhyay, Siddharth Agarwal, Debasish Chatterjee includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Paytm Wallet facing as an external strategic factors. Some of the topics covered in Paytm: Targeting More Pockets for Its Mobile Wallet case study are - Strategic Management Strategies, International business, Strategy, Technology and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Paytm: Targeting More Pockets for Its Mobile Wallet casestudy better are - – increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, geopolitical disruptions, wage bills are increasing, central banks are concerned over increasing inflation, increasing household debt because of falling income levels,
there is backlash against globalization, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Paytm: Targeting More Pockets for Its Mobile Wallet
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Paytm: Targeting More Pockets for Its Mobile Wallet case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Paytm Wallet, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Paytm Wallet operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Paytm: Targeting More Pockets for Its Mobile Wallet can be done for the following purposes –
1. Strategic planning using facts provided in Paytm: Targeting More Pockets for Its Mobile Wallet case study
2. Improving business portfolio management of Paytm Wallet
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Paytm Wallet
Strengths Paytm: Targeting More Pockets for Its Mobile Wallet | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Paytm Wallet in Paytm: Targeting More Pockets for Its Mobile Wallet Harvard Business Review case study are -
Successful track record of launching new products
– Paytm Wallet has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Paytm Wallet has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Ability to recruit top talent
– Paytm Wallet is one of the leading recruiters in the industry. Managers in the Paytm: Targeting More Pockets for Its Mobile Wallet are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Paytm Wallet are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Low bargaining power of suppliers
– Suppliers of Paytm Wallet in the sector have low bargaining power. Paytm: Targeting More Pockets for Its Mobile Wallet has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Paytm Wallet to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Paytm Wallet has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Paytm: Targeting More Pockets for Its Mobile Wallet HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Paytm Wallet is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Paytm Wallet is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Sandeep Puri, Shivani Upadhyay, Siddharth Agarwal, Debasish Chatterjee can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Training and development
– Paytm Wallet has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Paytm: Targeting More Pockets for Its Mobile Wallet Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Learning organization
- Paytm Wallet is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Paytm Wallet is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Paytm: Targeting More Pockets for Its Mobile Wallet Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Leadership & Managing People field
– Paytm Wallet is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Paytm Wallet in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Paytm Wallet
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Paytm Wallet does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Paytm Wallet digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Paytm Wallet has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Weaknesses Paytm: Targeting More Pockets for Its Mobile Wallet | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Paytm: Targeting More Pockets for Its Mobile Wallet are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Paytm: Targeting More Pockets for Its Mobile Wallet, it seems that the employees of Paytm Wallet don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Paytm: Targeting More Pockets for Its Mobile Wallet, is just above the industry average. Paytm Wallet needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Paytm Wallet is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Paytm: Targeting More Pockets for Its Mobile Wallet can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Paytm Wallet, firm in the HBR case study Paytm: Targeting More Pockets for Its Mobile Wallet needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Paytm Wallet has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Paytm Wallet even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Paytm: Targeting More Pockets for Its Mobile Wallet HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Paytm Wallet has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at Paytm Wallet has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study Paytm: Targeting More Pockets for Its Mobile Wallet has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Paytm Wallet 's lucrative customers.
Need for greater diversity
– Paytm Wallet has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Lack of clear differentiation of Paytm Wallet products
– To increase the profitability and margins on the products, Paytm Wallet needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Paytm: Targeting More Pockets for Its Mobile Wallet HBR case study mentions - Paytm Wallet takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Opportunities Paytm: Targeting More Pockets for Its Mobile Wallet | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Paytm: Targeting More Pockets for Its Mobile Wallet are -
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Paytm Wallet to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Paytm Wallet can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Paytm Wallet can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Creating value in data economy
– The success of analytics program of Paytm Wallet has opened avenues for new revenue streams for the organization in the industry. This can help Paytm Wallet to build a more holistic ecosystem as suggested in the Paytm: Targeting More Pockets for Its Mobile Wallet case study. Paytm Wallet can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Paytm Wallet can develop new processes and procedures in Leadership & Managing People industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Leveraging digital technologies
– Paytm Wallet can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Paytm Wallet in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Loyalty marketing
– Paytm Wallet has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Paytm Wallet can use these opportunities to build new business models that can help the communities that Paytm Wallet operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Building a culture of innovation
– managers at Paytm Wallet can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Leadership & Managing People segment.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Paytm Wallet can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Paytm Wallet to increase its market reach. Paytm Wallet will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Paytm Wallet can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Paytm Wallet is facing challenges because of the dominance of functional experts in the organization. Paytm: Targeting More Pockets for Its Mobile Wallet case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Paytm: Targeting More Pockets for Its Mobile Wallet External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Paytm: Targeting More Pockets for Its Mobile Wallet are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Paytm Wallet in the Leadership & Managing People industry. The Leadership & Managing People industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Paytm Wallet.
Technology acceleration in Forth Industrial Revolution
– Paytm Wallet has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Paytm Wallet needs to keep up with the evolution of technology in the Leadership & Managing People sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Paytm Wallet business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Paytm Wallet demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Paytm Wallet with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Paytm Wallet needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Paytm Wallet can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Increasing wage structure of Paytm Wallet
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Paytm Wallet.
Regulatory challenges
– Paytm Wallet needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Leadership & Managing People industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Paytm: Targeting More Pockets for Its Mobile Wallet, Paytm Wallet may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Paytm Wallet in the Leadership & Managing People sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Paytm: Targeting More Pockets for Its Mobile Wallet Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Paytm: Targeting More Pockets for Its Mobile Wallet needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Paytm: Targeting More Pockets for Its Mobile Wallet is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Paytm: Targeting More Pockets for Its Mobile Wallet is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Paytm: Targeting More Pockets for Its Mobile Wallet is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Paytm Wallet needs to make to build a sustainable competitive advantage.
