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In December 2012, a super-app named “Hike Messenger” was launched in India by a company called Hike Private Limited, founded by Mr. Kavin Bharti Mittal, son of Mr. Sunil Bharti Mittal, the Founder of Bharti Airtel. The company was launched with partners like Karbonn Mobiles and Vodafone. Hike messenger had big investors like Tiger Global Management, Tencent, Softbank, Bharti Enterprises, Foxconn Technology Group, Devon T Rogers, etc. The company was well flooded with good investments and with the help of these investors the company was growing continuously.

Finally, in the year 2016, it was valued at approximately $1.6 billion, making it the youngest unicorn startup with more than a 100 million registered users. Surprisingly, in December 2019, Hike was left with only 2 million users. Finally, on 14th January 2021, Hike app was permanently removed from the Play Store and the story of the super-app came to an end.

Why did a unicorn startup with such a large user base, big investors, good innovation, and advanced technology come to such a shocking end?

While the company had a lot of factors riding in its favour, the following can be attributed to its failure and subsequent downfall.

1. Too many features in the app

Hike Messenger was overloaded with many features including live cricket, payments, file attachment, audio calls, news, games, stickers, etc. Stickers that are now popularly used in chat on social media was one of the most famous features of Hike. Moreover, it was known as the sticker chat app. The app was made with a motto that it could provide multitasking facilities to its users, that is, it was an all-round app or a super-app.

The company was boasting of its advanced features but they were unaware of the fact that this would become the reason for the downfall of their company. People found it too complex to use as it was loaded with various extra features which were unnecessary for a messaging app. Actually, at that time, there was no need for such advanced features. For example, the online payment feature is undoubtedly beneficial if we look at it from the present perspective, but, in 2012, when the app was launched, digital payments were not popular in India. So it acted as an extra, useless feature to the users and such features caused discomfort to some.

Due to these extra features, people preferred to use Hike’s competitor, WhatsApp. Whatsapp was comparatively easier to use because it only provided basic features like normal messaging during those days. There were no features like video and voice calls, payments, etc. which exist today. Therefore, WhatsApp turned out to be more user-friendly than Hike.

By adding such extra features, Hike had increased its competition in the market. Jack Welch an American business executive once said “If you don’t have a competitive advantage, don’t compete”. Hike did not have any competitive advantage but it was unnecessarily competing with others due to its extra features.

2. No Unique Selling Proposition (USP)

Despite having many features, Hike did not have any unique features. When we install an app on our phone, we install it for a specific purpose. For example, Facebook is for socializing with people, WhatsApp is for messaging, Instagram is for photos and videos, Cricbuzz is for watching live cricket scores, etc. So every application has its unique feature but Hike fell short in this regard. Hike was the Jack of all trades, but a master of none. So, the application was unable to make its unique identity in the market. Therefore, the main purpose of installing the app was not very clear to the people.

3. Large Application Size

The application was overloaded with features that increased the space it took. Hike was available in 75 MB on the Play Store. According to the current scenario, 75 MB might not sound like a large app size, but in 2012, it was considered very large. In 2012, the speed of the internet was not fast, the internet was not cheap and data availability was limited. The internet connectivity also varied from area to area. In some areas, the speed was good but in most of the areas, the speed was poor. So, it was difficult for the users to download the app, and those who downloaded the app were dissatisfied with the high data consumption of the app.

People preferred WhatsApp over Hike because it was available for only 28 MB on the Play Store and the data usage of the app was also very less. Hike had completely ignored the internet availability in the country and due to this, the company did not seem to be concerned about the size of the application.

4. Selective Targeting

Hike messenger mainly targeted the people in the age group of 18-23 years and ignored the rest of the population. This selective targeting limited the market of Hike as they only focused on a very small section of the entire population. All marketing strategies of Hike were made according to the targeted age group only. But the competitors of Hike like WhatsApp targeted everyone, irrespective of the age group, and this widened the targeted audience of WhatsApp.

The founders of Hike were highly influenced by a Chinese super-app called “WeChat” which has a large user base in China. They thought that, if the same kind of app was launched in India, they could become the market leaders. They forgot to consider some points like the fact that WeChat does not have any competitors in China. However, in India, Hike had various competitors like WhatsApp, Facebook, etc. Also, the number of smartphones in China was far more than in India. The timing of the launch of Hike was also not perfect because, in 2012, the IT infrastructure of India was not as advanced as it is today. Due to all these factors, Hike was unable to get the expected response from the people.

Conclusion:

Understanding and analysing consumer behaviour is very important for the long-term survival of any business. Amazon started with selling books and then they horizontally integrated its product line and today they sell a vast range of products. Jio entered with telecommunication in the market and after ensuring customer retention, they launched JioSaavn, JioCinema, JioTv, etc. Hike should have entered the market with one definite USP, and if the customer retention was good under that particular USP, the company should have launched new features. However, the features of Hike got updated regularly because the company did not focus on consumer behaviour.

“The one who observes and then serves takes the pot of gold”. Hike mainly focused on innovation and ignored market observation and consumer behaviour. Innovation is not enough to run a business, analysing consumer behaviour and market observation are equally important for the long-term growth and survival of a business organisation.

By Mayank Drolia

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