Analysis Of Strategy In The Company Kwedit

Strategy Analisys of the Company “Kwedit”
Author: Vasco De Freitas • vjde.imba2010@alumno.ie.edu
Business Strategies for a Disruptive World • IE Business School Professor: Ricardo Pérez Garrido 29/04/2010

About Kwedit
Kwedit, Inc. founded in march 2009, based on Mountain View California, is a company in the eCommerce category and is self described as a Virtual Goods Payment System.http://www.kwedit.com

¿What is Kwedit?
Kwedit is a new way to pay for digital content and virtual goods (like online games, music, virtual stuff from sites like Facebook, Second Life...) without a credit card, debit card, bank account or Paypal account, and is suitable for adults and teens 13 years or more. The main idea of Kwedit services is to permit people with no access to traditional paymentinstruments or people that don’t want to use their credit cards for security, privacy and budgeting reasons, to pay for digital content and virtual goods that, for start, don’t exceeds $5 each. All this without any fees, charges or interests for the customer.

Kwedit Services[1]
The two services offered are Kwedit Direct and Kwedit Promise. Kwedit Direct let the user make online purchases andpay with cash through three different ways: •7-Eleven Shops: Once the user makes the purchase, the system generates a printable bar code, then the user prints it and go to any 7-Eleven shop, where he/ she can pay with cash, the payment is posted in your Kwedit account and you receive your purchase.

• US mail: The user makes the purchase, print a free, prepaid, business reply mailer. put themoney inside and send the mailer. When your payment reaches its destiny, Kwedit notifie you and you receive the purchase. • Pass the Duck: By this method you can ask a friend or family member to pay on your behalf using a credit card or any other Kwedit Direct payment options. If you're a teenager, you can share the details of your account with your parents when you ask them to pay for you. KweditPromise When a game or other site offers Kwedit Promise, you get virtual goods immediately in exchange for a Promise to pay for them later. Each site offers you a certain amount of Kwedit to use right away to buy things. When you Promise to pay, you are allowed a few days (one or two weeks) to pay off your Promise. If you pay your Promise on time, your Kwedit score rises, and the next time you play,you may get a larger Kwedit allowance on this and other Kweditpowered games.

Kwedit Value Network

Game Publishers/Developers and Digital Content Providers

Foot traf

fic increa

se

Retailers (7-Eleven)

Conversion Rate increase Kwedit Posibility to pay without cash Customers

Pay-in cash channel
Comission for cash

Cash

and Gamers

Kwedit business model
Kweditbusiness model consist on charging a comission to the providers of virtual goods and digital content, over each sale they make using Kwedit services.

Kwedit Strategy
Kwedit strategy is based on offering an attractive service for the market niche without access to traditional payment methods (teenagers or unbanked people) or people that having the credit card don’t use it for privacy, security orbudgeting issues. The target market of Kwedit are the 25% American families don’t have a credit or debit card and the 75% of the people that have credit or debit cards, but don’t use them for budgeting, security and privacy reasons. The main features of Kwedit offer are: • Only for payments of digital content and vrtual goods (mostly online gaming) • Payments of up to $5 • Cash payments • Promise topay in one or two weeks The first step is to enter the category of social network games and free-to-play games, because the huge amount of users there and the lower price of the virtual goods sold on that kind of sites (less than $5). Additionally, the free-to-play developer companies or social game publishers have a real interest on Kwedit services because it will represent the chance to give...