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Story behind Apple's credit card with HDFC 🤯
It's not distribution or just affluent users, it's more than that.
In 2017, Apple started India manufacturing. By 2023, it opened the first 1st retail store in Mumbai’s BKC. In few weeks, it’s launching a credit card with HDFC. This is the breakdown of why two giants are coming together ⬇️
Quick context 🗓
It all started yesterday with Apple completing selling 6 million smartphones last year. The apple CEO visiting India & opening the BKC store in Mumbai. It isn't a coincidence.
Apple aspires to make India it's 3rd largest market after US & china. And it's pretty aggressive in how it thinks about the India market beyond just hardware selling.
Why launch Apple card with HDFC Bank? ⬇️
1/ Apple's core loop is software sells 🕹
The apple pay becomes the default option for iOS users to make purchases across the apple "App store". Apple makes ~30% commissions on "in-app purchases".
2/ Value of for iOS ecosystem goes up 📈
As a apple ecosystem user, the work device (Mac), Mobile (iPhone), Earphones (AirPods) & even wearables (iWatch) will be able to sync with Apple pay. Making it a seamless experience to pay in the offline world.
3/ HDFC = distribution 🔥
It's the largest bank by market cap & has all the high value customers that gives apple the right kind of distribution (retail customers & merchants). Apple doesn't have to figure this on their own.
4/ HDFC wants the high value wallet share 💳
Apple customers are the most "affluent spenders". These are the kind of audience a bank would want to lend to - super low default rates on lending, plus there is so much you could cross sell to a savings account user.
5/ But, why not launch it's own card? 🙇🏻♂️
Just like how Apple does it in the US (sure, the chase powered). Indian laws are amazingly strict on what a foreign non banking entity like Apple can and can't do in India. Apple can't win that war.
6/ What could do wonders to this deal? 💸
Visa is in the race to make sure it powers the "Apple Pay <> HDFC" credit card. But, with RuPay push from the Indian government, it could be a game changer.
7/ RuPay opens the "Credit on UPI".
And Apple + HDFC would love to own the UPI pie of these "affluent spenders", that way there is no way this card does not become the most sought out card in India - atleast for iOS users. Exciting times ahead for sure.
Apple’s India GTM is science 🧪
Most internet companies fail to understand the nuances of go to market when it comes to launching V1.0 in a small market, launching for adjacent users or launching newer verticals as a platform product. At the GrowthX experience, we go deeper into GTM for internet first products. Over 2,200 members have built solid craft right inside the first 8 week immersion itself.
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