How CRED is building a brand that's impossible to ignore
The first of a series on India's super cool startups
A couple of weeks ago, I was editing an essay for work based on a talk by Kunal Shah, founder and CEO of CRED.
It was about his now-popular Delta 4 theory.
Quoting: "Once the user experiences a significantly better way of using a product, there is no way he or she is going back to the old way of doing things."
Basically, what he’s saying is this: If your product can make the experience 4x better, you have built something significant. It makes sense, and a lot of people I know subscribe to this idea. I think I do too.
But in everything he said, it wasn’t this point that interested me most.
Kunal spoke about something he calls the UBP: Unique Brag-worthy Proposition
The thesis is this: Humans love to brag about a new exciting product that they are using, to other humans who have not discovered it yet. This phenomenon becomes so prominent that it ends up being more important than the product’s own USP.
Hold that thought.
CRED is everywhere, isn’t it? The brand demands attention, the founder’s pronouncements are ubiquitous, and it makes sure you are talking about it constantly.
But first, what does it do?
This, from Nutgraf, The Ken’s newsletter written by Praveen Gopal Krishna, sums it up:
“CRED is a Fintech company that was created to solve a single use-case—paying credit card bills. This isn’t even a compelling problem. Nobody really needs CRED to pay a credit card bill, so it’s important for CRED to create that need. And they did that by offering reward points every time a user paid a credit card bill. These reward points are redeemed for cashbacks, discounts, and other offers on the platform. They act as a motivator, reminding users to take the trouble to log in to the app every month to dutifully pay their bills.”
Simple enough, absolutely needless, and yet a known, accepted consumer brand in record time.
But that’s not the interesting part. The interesting part, at least for our discussion, is how they went about doing this.
In Beyond the First Order, another newsletter from The Ken, their marketing manager Sanjana Ramachandran tells you exactly how (I’ve paraphrased, wouldn’t be fair if I copy-pasted the whole thing; I was sorely tempted to, it’s exceptional writing):
CRED is reading (the) marketing playbook backwards.
First, it raised US$30 million in seed money even before it had a product. A crucial factor in CRED’s media strategy is the current funding environment, a golden age for startups.
Second, CRED jumped to advertising on national television, which reaches about 200 million households in India.
Third, even when it comes to making TV ads, CRED has broken the rules: A 30-second ad has a typical flow—establish the consumer’s problem in life, bring in your product, show it in glorious action while touting its benefits in solving said relatable, relevant consumer tension.
None of this happens in CRED’s ad. The company is barely visible in it.
Instead, the Indian actor Jim Sarbh begins with a deadpan, “When you pay credit card bills on CRED, you earn CRED coins. Use them to claim cashback and rewards.” He admits this is ridiculous, echoing, perhaps anticipating, people’s reactions to CRED itself.
The ad then knowingly becomes even more ridiculous by showing a retired, genteel sportsman beating up cars, screaming on roads, flinging milkshakes at people. In short, breaking all the rules not only of road traffic but also civil human behaviour.
Why is CRED doing this?
(Because) It really doesn’t take much to be an app that reminds people to pay credit card bills and provides cashbacks. Instead, by being ridiculous and acknowledging it, CRED invites people to be the same. Use the app despite its banality, and be ridiculous and rule-breaking.
Meanwhile, building a brand at a massive scale—which its nearest competitors would not be able to do for a while—is CRED’s real business model.
As Sanjana writes, the media hype around CRED, fulled by smart PR and great advertising, is not by any means random. It’s strategy, something the company actively uses to make sure its users remember it all the time. The attention keeps them in the spotlight, and helps them build the brand, which is what they are really selling.
Genius.
Just one more thing: what kind of brand is CRED building?
Sometime ago, Sumanth Raghavendra made the bull case for CRED in an essay in, where else, The Ken.
In it, he wrote about what he felt was the moat CRED had built: its brand.
“In the space of less than three years, CRED has managed to build a distinct brand for itself. So much so that while everyone from Amazon to Paytm have competitive products—credit card payment services with reward points earnings—there is zero brand recall for anyone other than CRED.
CRED’s marketing achievement is not based solely on recall. It has also successfully positioned itself as a luxury brand that is both cool and aspirational. There are hardly any comparable startups in India who have managed to do this, much less in such a short period.”
The key words here: cool and aspirational.
Let’s go back to Kunal Shah’s idea about the UBP: Unique Brag-worthy Proposition.
CRED is a masterly manifestation of this idea. A brand that’s cool and aspirational, using which gives you nothing more than belonging. But that belonging is reinforced and made strong by making sure you hear about them, see them, and engage with them all the time. Remember Sanjana saying that the company is barely visibly in the ads? This is deliberate, of course, because what does CRED have to sell, really?
What it’s selling is a cooler, smoother, slicker you.
The startup harnesses cleverly storytelling, PR, and a brilliant understanding of social media and the online space to create an aura of aspiration: You are part of an elite group if you use CRED, you are told, again and again, until you believe it.
As I keep telling you, genius.
CRED is a super cool startup on steroids. There’s just so much to learn from the brand and how they go about doing what they do that I’m constantly watching them, even if just to take notes about the next stunt they’ll pull.
So should you.
Notes
Firstly, a nod to The Ken, whose excellent reportage and analysis I rely upon heavily here, mostly because I couldn’t have written it better. You should subscribe if you haven’t yet, they are worth every inflation-weakened rupee of yours.
And a reminder that this is the first of a month-long series on super cool startups. You can read the introductory essay here.
I’ll be showcasing Indian startups that are doing great marketing, and hopefully learn from their strategies and tactics. You can subscribe below to get these directly in your inbox.