Customer relation management (CRM) and automation startup Hashtag Loyalty has raised an undisclosed amount in a Seed funding round from New York-and Delhi-based seed stage focused investor Ahimsa Capital. The startup had previously raised funding in a Pre-Seed round in August 2016 from a another seed stage investor thinQbate.
Mumbai-headquartered Hashtag Loyalty was launched in May 2015 by Dhruv Dewan, Karan Chechani, and Krishi Fagwani. The startup began its services by offering hardware-based solutions. It offered businesses a kiosk tablet and a card used in enabling loyalty service program, mostly to help restaurants entertain and engage customers. Their hardware-based offering had about 70 restaurants in Mumbai with 45K users.
“We didn’t see it scaling as hardware was involved and was getting expensive in terms of manufacturing,” Dhruv said.
After a year, the early-stage company pivoted into a mobile number-based solution, this time, putting more focus on CRM aspect –which helps in managing contacts, sales workflow processes, productivity –instead to help offline businesses engage with their customers.
With the latest round of investment, the startup plans on increasing businesses value proposition and expand growth trajectory.
“This round of funding is a culmination of our single-minded focus on presenting true value to offline businesses. We are really excited about the support we’ve received from the Ahimsa team. Their combined expertise building top-notch brands will help us take the next leap in our journey,” said Karan.
Hashtag Loyalty: Helping Businesses Capture Consumer And Transaction Data
Inc42 caught up with founders of Hashtag Loyalty to get more deeper insight into their offering.
As Dhruv says, “the core technology did not change,” when it shifted from hardware offering to CRM. It launched its CRM platform in November 2016 to help businesses –mostly in the retail sector –capture customer data, usage patterns and buying behavior and study them to serve their customers better. As Dhruv claimed further, they converted about 80% of the hardware clients to CRM.
“We help offline businesses capture consumer and transaction data either via loyalty, as well as feedback. Once the data is entered into our platform, we provide businesses a tool where they can interact with the customer and help them connect more to the product/service,” Dhruv said.
To explain more, Dhruv cited an example. “Suppose, if one visits a Belgian Waffle outlet and buys a waffle and doesn’t come back for about a month. Since the transaction took place through our system, we will be able to automate all marketing communications of businesses based on who the customer is, what they buy, how much money they spend, what they do etc. Thus, the company can send the customer an offer around a product they had consumed or can push in more customised notifications to lure the customer back to the store.”
With its back-end based on Ruby or Rails framework, Hashtag Loyalty also uses a lot of machine learning to automate the communication with the customers.
Hashtag Loyalty: The Marketing and The Monetisation Strategy
Hashtag Loyalty is a business-business-customer (B2B2C) focused startup. It has its team members working in Gujarat, Hyderabad, NCR, and Bengaluru with a total of 15 employees and three data science interns. The startup has so far made over 600 sales generating $10K-$13K (INR 7.5-9 lakhs) per month.
Currently, it’s platform is being used by approximately 12.5 lakh users, processing between 7K-8K transactions on a daily basis. Its platform has crossed over 2.5 Mn transactions, so far, as claimed by the founders. It charges businesses annually based on their number of outlets.
“Our price range anywhere between $21-$58 (INR 1.5K-4K) per outlet. per month and is billed annually. The price differs with the number of services Hashtag Loyalty is offering,” Dhruv said. He also added, “Most of our sales is made through organic references.”
Another stream of monetisation comes through ads on its platform. “We use social media to target business, we do marketing with our clients and they in turn leverage the product to connect with the users,” he added.
The startup has also initiated a POC with Atom Technologies, India’s leading omnichannel payment service, to launch Atom Rewards a coalition loyalty platform across its partner network. The initial POC will involve close to 250 outlets primarily across Mumbai and Pune.
CRM Market In India: Growing Large With Players Like Zoho, Capillary Technologies And More
American research and advisory firm Gartner estimates global CRM software revenue amounted to $39.5 Bn in 2017. The Telegraph reported that the total addressable market for CRM is estimated at $706 Mn in India and is expected to grow at 18%.
Limesh Parekh, the CEO of Enjay IT Solutions, believes that CRM tools collect customer data from various onboarding touch points like WhatsApp, social media, exhibitions, wearables and product usage –which customers readily share by themselves –with minimum or no human intervention. This, in turn, saves the time to enter data manually into the software.
As customers look for more personalised experiences, to fulfill this, CRM is already witnessing an evolution in form of artificial intelligence (AI) and Analytics.
The SaaS behemoth and unicorn, Zoho CRM, recently unveiled Zia Voice, the first conversational artificial intelligence (AI) for sales teams that adds speech and chat capabilities. It has also introduced Catalyst, a set of capabilities that allow larger and complex businesses to build their own mobile and web apps and additions to Zoho CRM.
Another major CRM player in India, Capillary Technologies, raised about $20 Mn funding to use the proceeds to strengthen its new product development, powered by AI and Machine Learning.
Apart from these, there is also a rising brigade of CRM startups in the country which include names like Mera CRM, Cratio, Maple CRM, Sales Mantra, ClinchPad, enKast, Agentdesks among others.
However, even with the space getting crowded with more players, Dhruv considers that the CRM market in India is way beyond saturation for now. He maintained that the startup in the next six months will be focussing heavily on expanding its technology offering – to a suite of products across the value-chain for offline businesses; including an AI-powered marketing assistant and social engagement platform.
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