Project Background
Throughout the 2017-2018 period, AlipayHK engaged in a year-long subsidy battle with other payment competitors in the Hong Kong market to expand its payment market share. The subsidy methods largely followed the operational strategies and tactics used in mainland China. As a result, Hong Kong users packed up to wherever subsidies were offered, using various e-wallets to collect coupons while continuing to use Octopus as their primary payment tool. Once the subsidy levels decreased, it led to user attrition and reduced activity, resulting in very low operational funding efficiency.
2018 Q1-Q2 Business Objective
Overall improvement in users' willingness to use AlipayHK for payments.
Identify the core scenarios/payment motivations for using AlipayHK.
Increase the frequency of existing users using AlipayHK for offline payments.
Improve the retention rate of activated users (Defined those who have completed registration, received coupons, and made their first redemption).
Enhance the efficiency of operational subsidies.
Ground Understanding
How do I break down business objective
I organized and invited the team and key stakeholders of AlipayHK (product, design, operations, marketing) to participate in a week-long design sprint session. The goal was to fully understand the current state of local Hong Kong users' interactions with e-wallets (activity, perception, feeling and emotion) in order to identify exclusive operational strategies and payment scenarios suitable for the local market with a feasible solution.
Define & Design Strategy
Through a week-long design sprint session, we concluded that AlipayHK's current business development and related financial capabilities in the local Hong Kong market are not yet mature enough to directly replicate Alipay's user acquisition model from mainland China. This has resulted in limited reach within the core payment scenarios of Hong Kong residents' daily lives, and in the short term, it is difficult to find another payment scenario that can rival the daily commuting scenario（ Octopus Card ）. we decided to give up the strategy of establishing core payment scenarios to acquire users.
Instead, we aligned with the current user base, which primarily consists of promotion-driven users, and pivot our focus from creating core payment scenarios to developing localized operational activities (From scenario-driven to content-driven). By leveraging local culture to motivate users adopt us, then driving long-term business growth.
Insight From Hong Kong Local's Behavior ——Hong Kong's Affinity for Stamps
After shopping in Hong Kong, receiving change, getting a receipt, and then a long strip of stamps is a familiar scene. Sticking the stamps in a booklet to exchange for household items or limited-edition figures with discounts is something Hong Kong people enjoy.
Hong Kong Street Field Trip Research
Why do Hong Kong people love collecting stamps? Frequent shoppers from Mainland China in Hong Kong might wonder about this. In our perspective, this inefficient and washed discount method is still maintained by Hong Kong retailers.
In fact, collecting stamps is an unique memory for a generation of Hong Kong people. The experience of exchanging stamps for kitchenware or limited-edition cartoon figures goes beyond just obtaining discounts. While similar methods are used by retailers in mainland China, they are not as widespread or deeply ingrained in the culture as in Hong Kong.
There are generally three ways to use stamps for redemption in Hong Kong:
Collect a certain number of stamps to get a free item.
Collect enough stamps to purchase a valuable item at a very discounted price.
Use a few stamps to get a discount on an item if the number of stamps isn't enough for a full redemption.
Even in the era of mobile internet, Hong Kong people still love these stamps. For many, each stamp feels like a companion from their childhood. In the 1980s and 1990s, Japanese companies like Jusco, Japan Home Centre, and Yaohan popularized stamp collecting activities in Hong Kong, which were very well received. Every weekend, Hong Kong people would go to these department stores to enjoy the air conditioning, check out the promotions, and collect stamps and booklets at the service desk after shopping. This habit has been retained, with young girls growing up to become homemakers, making stamp collecting and discount exchanges a unique shopping experience for Hong Kong people.
How Might We
How might we leverage Hong Kong residents' enthusiasm for collecting stamps by providing an electronic stamp collection feature? This feature would offer stamps as rewards for payment behaviors and could be integrated with any offline payment scenario to empower businesses. Additionally, the stamp collection process could extend the task duration, increasing user retention, willingness to use, and usage frequency. It would also enhance merchant participation and onboarding, accelerating the expansion of AlipayHK's payment coverage.
Wireframing & Testing
Feedback
Understanding and Acceptance
Most users quickly understood the concept of the e-Stamp function and found it appealing. They appreciated the ease of collecting and redeeming stamps. The majority of users found the e-Stamp function attractive and motivating. They expressed interest in rewards such as discounts, free items, and exclusive offers. The simplicity and convenience of collecting stamps digitally were highly appreciated.
Usability Issues
Few users encountered difficulties navigating through the digital prototype, indicating a need for clearer instructions and a more intuitive interface.
Suggestions
Users suggested having a dedicated area to display and showcase their e-Stamp collections, as well as to visually manage their stamp collection progress. The key visual of the e-Stamp collection can be more aligned with the brand theme and have a digital gallery feel, without too much operational look.
Expected Outcomes
Users believed that the e-Stamp function would positively affect their payment habits, encouraging them to use AlipayHK more frequently. They identified retail shopping, dining, and entertainment as the most suitable scenarios for using the digital stamp function.
Achievement & Impact
Increase in user adoption rate
The introduction of the e-Stamp collection feature successfully boosted user willingness to use AlipayHK for payments by 18%.
Increase in payment frequency per user
The gamification and rewards aspect of the e-Stamp collection feature increased the frequency of offline payments by existing users by 25%. Users were motivated to use AlipayHK more often to complete stamp collection tasks and redeem rewards.
Retention Rate of Activated Users
The retention rate of activated users improved by 32% as the e-Stamp collection feature provided continuous engagement opportunities. By offering regular rewards and visible progress tracking, users had more reasons to stay active on the platform.
Cost per acquisition (CPA) and return on investment (ROI) for subsidies
The efficiency of operational subsidies was enhanced by 15% through targeted rewards and a more engaged user base. Consequently, the operational investment in subsidies resulted in a higher return through increased user transactions and extended user activity.
Long Term Business Impact
The e-Stamp collection feature has now become an integral part of the urban lifestyle for the new generation of Hong Kong residents and is highly cherished. Our main competitors have followed our design concept ( Octopus Card launching its electronic stamp collection feature in 2021). Additionally, local merchants have begun to adopt this concept, introducing their own store-specific stamp collection programs to continue offering benefits to local citizens. This widespread adoption underscores the success and influence of the e-Stamp collection feature, solidifying its place in the market and ensuring continued engagement from users.