"Don't need advertising to meet next year's number": Byju's

A look at the ed-tech company's advertising journey so far...

With Rs 500 crore projected as the current year's turnover, almost twice that of the previous year's figure, Byju's is confident that the online-education company will most certainly not require advertising to meet its next year's "number". Mrinal Mohit, chief operating officer at Byju's, shares, "If I have to meet or cross my 2018 number, then I don't need to release any ads. In today's day and age, advertising is not the main fuel to run businesses."

Mrinal Mohit

Mohit, however, is quick to add that advertising spends incurred now will be justified three to four years down the line. "This is not a short-term investment, it is a long one. Please remember, I am creating a segment which never existed before," he states.

Byju's tryst with advertising began in 2015 when the ed-tech company launched its 'learning' app. The brand released its first TVC for the Indian market which was relatively alien to the online-education model with only 'Khan Academy' as the Western point-of-reference. However, unlike Khan Academy, which provides its services free of cost, Byju's has its monetisation policy attached to subscription fees. Interestingly, both companies are backed by high-profile investors - Khan Academy by Microsoft's Bill Gates and wife Melinda Gates; Byju's by Facebook's Mark Zuckerberg and his wife Priscilla Chan, among other key investors.

Byju's first TVC hit screens in 2015. Lowe Lintas has been the company's creative agency since then

Byju's was incorporated in 2011 by Byju Raveendran and the company initially provided online video-based CAT classes; word-of-mouth being the primary source of advertising.

Divya Gokulnath

Divya Gokulnath, director and co-founder, Byju's, says, "Before 2015, we were busy creating the product. In current times, launching an app was important as around 70 per cent of the students in India have access to smartphones. Probably, we might find a different platform tomorrow. Nevertheless, we wanted to work on the product for at least four-five years so we could justify investment in mass media. Hence, when we made our debut on TV it was mainly because we had a product (app) which covered a wide range of topics from class four onwards."

Byju's chose TV as its lead advertising medium since the product's visual nature was its unique selling point. Mohit informs, "When we released our first campaign, we assumed that it will appeal only to parents in the metros. We thought that it will take some time before we reach out to tier two and three cities. To the contrary, we saw that roughly 75 per cent of downloads were outside the metros and the important thing was that the users were also paying for the course."

Byju's squeezed-in print ads in its media pie to ensure that parents are made aware about the app
Click on the image to enlarge

In an attempt to leverage the then newly-found target audience, Byju's squeezed-in print ads into its media pie to ensure that parents from non-metro regions are made aware of the app. The company felt a need to interact with parents who, as Mohit describes, are "strong influencers" in his business model. Moreover, the brand released 40-second-long videos, featuring Raveendran, explaining the 'Pythagoras Theorem' in order to create blanket awareness for the app.

Byju's released 40-second-long videos, featuring Raveendran (founder, Byju's) explaining the 'Pythagoras Theorem' in order to create blanket awareness for the app

Mohit shares, "We use TV mainly to reach out to students, which can also be termed as customer acquisition. So, once the primary audience is received i.e. the students have downloaded the app, we have to reach out to the parents and we do that through print ads. The print medium is mainly for parents, not for kids."

Another print ad released by Byju's
Click on the image to enlarge

Byju's intentions are clear, they do not want to route their message through parents or teachers. "In fact, it works the other way," explains Gokulnath and adds, "Today, even if I can convince the parent/ teacher and not the student, then the student will not use the product. But if students download the app and use it, then parents/ teachers automatically get involved."

Last year, Byju's signed actor Shah Rukh Khan for it's a new ad. The idea now was to engage both parents and students on one platform and the company intended to leverage Khan's popularity across age groups. The ad was crafted by Lowe Lintas, who Byju's has been associated with since 2015.

Last year, Byju's signed actor Shah Rukh Khan for its then new ad in order to engage both parents and students on one platform

"When we started advertising, none of us knew anything about it," confesses Gokulnath adding, "We are not from this industry, so we went after the top five or six agencies and had multiple meetings with them. The idea was to go for mainline agencies."

While briefing agencies, Byju's made it clear that the brand's line of communication will hover around the concept of 'love for learning'. "We were very clear not to talk about our success rate or say that we will make your kid score more. On the other hand, in the entire education segment, no one says, 'I will make your child fall in love with learning.' Imagine, most parents might say that they are not interested in the 'falling in love part' and would rather have their kids score high in exams. Promising something like this was a very risky bet. However, we were very convinced about this being our tagline. So, when we met Arun Iyer (chairman, chief creative officer, Lowe Lintas, India), he was able to understand what we were talking about and was ready to take that risk," Mohit shares.

Another TVC released by Byju's in 2017

Presently, the company sets aside 20 per cent of its revenue for advertising, a 10 per cent decline from what it was three years ago. Rising word-of-mouth is the reason behind Byju's reducing dependence on commercial advertising. "If you look at the organic reach, I see an increase of 10-12 per cent month-on-month," says Mohit. Within the advertising budget, 50 per cent is reserved for TV, 25 per cent for digital, 15 per cent for print and the remaining is divided between ATL/ BTL activities including theatre advertising.

While the company has reduced its ad-spends, it continues to have faith in advertising. Mohit shares, "We were coming up with big print campaigns even when the company's revenue was very low. We were and are very paranoid about the performance or the ROI of our ads which is why all our campaigns will have a call to action."

Mohit tells us that there is a direct link between ad campaigns and app downloads. He recalls, "When we went ahead with our first TV campaign the call to action was very clear - to download the app - and the same happened immediately. Within six minutes of the first ad, we saw a spike in app downloads. This is something we observe even today. In fact, the spike is now much higher than what it was two years back."

Statistics tell us that Byju's presently has 14 million registered students and nine-lakh annual-paid -subscriptions. The app boasts an average engagement time of 53 minutes per day with 85 per cent annual-subscription renewal rate.