The prospect of a government job is often equated with massive job security, earned respect and additional perks in India. There is an estimated audience of around 8 crore people, who appear for government job-related exams in India every year. ‘Adda 247’ operates as one of the largest Government-Exam focused Online Test-Prep company.
In an interview with Mr Anil Nagar, Founder & CEO of Adda 247, we attempt to find out how the platform has managed to garner 40 million users despite not spending too much on marketing and how it shifted from an offline oriented business to a completely online education platform.
Q. How has the journey been in coming up with Adda 247 and scaling it to where it is now, one of the major players in Job-Based Test Preparation segment?
We have been completely focused on government test prep from the beginning. Our major target audience has been the tier-2 and tier-3 cities. The gap that we identified was access to education in tier-2 and tier-3 cities and villages and towns. We are essentially a mobile-first ed-tech company. We launched an app initially in 2016, as we identified mobile was the major source of learning for students. Before Adda, we had Career Power as our offline centre base. Connect with our audience is a big strength for us, wherein we focus on solving their specific pain points. Our major focus was to improve the online learning experience and develop it better than offline. In these 4 years, we have grown from 0 crore to 43 crore, with absolutely 0 spend on marketing. During 2016, we created multiple websites catered to different exams. BankersAdda which had nearly 1 crore users in 1 year, offered a complete solution for Banking exams aspirants, SSCAdda, TeachersAdda and similarly DefenceAdda. We are focused on engaging with YouTube, where we have 10+ channels, on which we get a daily viewership of one million. Even if you compare engagement on our app, compared to other players in the segment, we are way ahead in terms of traffic. Last year, we had 42-43 million users across all platforms out of which 4.5 lakh were paid users, which would be the 2nd largest after Byjus.
Q. How does Adda’s business model function, with respect to its different product offerings?
We brought down the offline business in 2016 when we launched Adda. We still have few Career Power centres on Franchisee basis. It was a big decision to close offline as we were doing well in it and had good experience functioning in the same. We tried to create an ecosystem where we could use both offline and offline learning. We started content partner programs wherein we partnered with coaching companies to provide them online content and modules. Later on, we converted our franchisees into our partners and provided online content in bulk to them. They operate independently now. We created this ecosystem of 400-500 offline coaching institutes who sourced online content for us. This B2B offering helped us in branding & marketing, because we don’t focus much on advertising through Google or Social Media channels. We operate on a Freemium model. Users come to our numerous websites or the app, use free content and then we try to convert them into a paid user. Primarily our model is a la carte. We provide comprehensive offering to students in the form of E-books, physical books, live classes, mock tests and interview prep resources to students. We have recently introduced subscription which provides a 1-year access to all offerings, including live classes under a specific test category. All our content is owned and developed in-house.
Q. One of the major attraction points for a Test Prep platform is a Customer-Centric and Customer-focused approach. How does Adda 247 map customer satisfaction or engagement for its learners?
We have feedback capturing tools across our platform on the basis of individual tests and courses too. We have been a customer and student-first company in our approach. Talking about internal benchmarks, we derive ratings out of 5 and for us it should be minimum 4.6. Talking about engagement, free users have an engagement of around 30 mins while paid users have a time of around 1 hour/day.
Q. How has the demand for Test Prep been impacted due to the COVID situation?
Because of the Covid situation, most of the offline centres are closed currently. Before Covid, 90% of the business was offline, while 10% was online. The serious aspirants who form that 90% has been forced to come online. This situation will also lead to the emergence of new players in the online segment. Though, there is huge demand right now for this segment, exams have pushed to latter part of the year and there is an uncertainty in exam dates with respect to government test prep. Exams which were scheduled in March, April and May have been postponed and will happen in 3rd of 4th quarter of the year. There has been some immediate negative impact on government test prep; however I feel that this segment will be more important in the future. The importance of a government job will rise and there currently is a pressure on government to create more jobs. As soon as things become normal, there will be more takers for government test prep courses.
Q. What is the future growth scenario that the industry would witness? What would be emerging trends or new technologies that would impact competition and business growth in the future? What are Adda’s plans for the future? Any market niches that you feel will be filled going forward?
There are signs of Virtual Reality to be the next big thing in next coming years. There is a one-time cost of creating VR based content but the problem would be on the consumer end here. Although we believe that VR would get cheaper in the next 2-3 years. In the near future, Adda wants to be very focused on government test prep. We will look to focus on government categories in which we are not present including both National Level and State Level exams. We will look to introduce vernacular language content to support rural background learners. It’s a different audience and we have to understand its need and develop products accordingly. We would like to build products based on the need of our audience aged 18-30 years. If we talk about niches in online education in India, companies hardly have done any innovation on education side. They have merely replicated the offline experience to online. There is a huge scope for new solutions and innovation in the industry.
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