PayPay’s Head of Marketing Leading Bold Campaigns Reveals Behind the Scenes of Company’s Growth

PayPay Leader Interview is a series of interviews with PayPay top executives that show a glimpse into their personalities and perspectives. Today we introduce Hirofumi Fujii, Division Head of the Marketing Division.

What is PayPay’s marketing strategy for generating continuous growth?

Now that there are over 55 million users, where is the Marketing Department headed next?

We have entered the phase where we increase the “number of active users” on the vertical axis and the “lifetime value (LTV) per user” on the horizontal axis on an x and y graph, so to speak, to maximize the gross LTV of the area covered on the grid.

Continuing to broaden the user base and further our results on the x-axis is a part of this. We believe that PayPay is a platform that can be used by anyone in Japan, so our aim is to reach every single person.

However, we must try a different approach to the segment of people who have not yet used PayPay despite the numerous campaigns to date. This will require a lot of careful work, including segmentation of users.

Another is to increase the LTV of each user to work on the y-axis. This is the area of so-called CRM: increasing use cases, contact frequency, loyalty, and so on. Simultaneously, we are also working in the area of user growth, such as enhancing the number of use scenarios with new services and thus expanding the LTV of users.

What is the key to creating a marketing strategy that supports PayPay’s rapid growth?

As I mentioned briefly in a previous interview, I think the key is to create a reusable template. It would be inefficient to waste a perfectly good idea or a campaign that we spent a lot of effort on in just one shot. It may even mean putting PayPay’s growth on hold if we ever run out of new ideas. So a successful model is made into a template -> we refine it -> and repeat it until it loses effect. That way we can create a new template in the meantime and repeat the cycle. Such a strategy is crucial in an environment like ours, where there is so much expectation for continuous growth.

‌For example, the template of “Support Your Local Town Project” held in collaboration with local governments was a “big hit” that met the needs of municipalities during Covid. We are now preparing the next template that meets the new needs of local governments.

The successes and failures behind PayPay’s growth

Tell us the story behind the creation of the PayPay jingle that plays during payment!

Sure. There were some e-money companies like Quickpay using a sound logo around the time we launched, but no one in the mobile payment sector was using it. So it was something that we wanted to try at some point. We had decided to launch a large-scale campaign (“10 Billion Yen Giveaway Campaign“) in December 2018, so we had been secretly preparing the jingle in time for that campaign (laughs). We created about 20 jingles, conducted an internal survey, and suggested introducing it in time for the 10 Billion campaign, but due to resource issues and other factors, it wasn’t scheduled to be launched at the time.

In an unexpected turn of events though, Miyauchi-san, the president of SoftBank back then, called Nakayama-san, our president, and asked, “Aren’t you going to use a jingle?” Then my phone rang. It was Nakayama-san on the other line asking, “Do you have a jingle ready to go?” “I do have one ready,” was my response, and it was as smooth as slipping it out of my pocket and handing it to him (laughs).

In the end, the Product team was able to deliver and we got the campaign up and running in time to have the “PayPay♪” sound echo across Japan. It was a great way to raise awareness because the jingle made people think, “Hey, everyone’s using it,” so having been able to launch at that time was huge!

While on the subject, were there any marketing measures that failed?

There have been many.
There was an offline promotion we ran one summer at a beach resort near the Kanto area, but it happened to be a cool summer where it rained every weekend, and no one showed up at stores. There was another campaign that was a bit complicated with a limited number of participating stores that led to low user recognition, which in turn resulted in not having any impact. That was a couple billion yen that went down the drain.
It’s alright to fail. Just throw enough mud at the wall and some of it will stick, and you can work to improve on the bits that stuck. I think that’s what marketing is about. Just don’t leave as a failure. Figure out why you failed, and then move forward.

How do you come up with one idea after another?

I think the minimum requirement for a marketer is to always stay tuned to one’s company’s services, the industry, or to marketing-related information, and keep a wealth of knowledge or ideas on tap. If you do not increase the amount of knowledge you absorb, there is no way you can improve the quantity or quality of the work you produce. It’s also essential to have the ability to connect different sets of information. It’s about having different sources of creativity to draw out from for a project. Finding the right combination is a matter of having the knack for it, but it can also be trained. I also believe that the more options you have, the better your chances are of success.

Wider, deeper, faster

What are the current challenges the Marketing Division faces and what things do you want to strengthen?

Marketing is, in essence, “telling the world what’s good about your company, getting people to know the products/services, and getting people to actually use them.” Right? First, you need a good product. Well, we’re extremely blessed in this part. We have an app that is easy to use and fast evolving, as well as one of the largest merchant networks in Japan. But whether this “good product” is well-conveyed to the world is a different story. When you look at things another way, it can also be said that we’ve only grown as much as we have because there are pieces that haven’t been well communicated.

When we surveyed non-PayPay users about their reasons for not using the app, the answers varied from not finding enough stores to use it at, to worrying about overspending. These are actually areas we are strong in, but are nonetheless reasons for people’s reluctance to use our product. I would say this is the result of our lack of marketing. It’s not easy to get people to understand 100%, but the way you communicate and the media you choose will change the way you get the message across. I don’t believe at all that we are at our best.

With the number of users we now have, we’re at the stage where it’s valuable to run campaigns towards more narrow segments. Even if you divide the 55 million PayPay users into 50 segments, that’s still more than a million people per segment. We can definitely dig deeper.

What corporate culture do you value the most?

If I may choose from the PayPay 5 Senses, “Speed is our bet on the market.” The market is moving fast, and user behavior and thinking are also constantly in flux, so as marketers, we must keep a firm handle on this. I believe that we now live in an era that demands our ability in how quickly we can sense and adjust to change.

Is there anything you are working on to keep up with the fast pace?

Now we are working on clarifying the decision-making process.
This means establishing rules so that we can systematically proceed with a project at the fastest speed possible by working along those rules. Although sticking to a model may lead to doing unnecessary things in some respects, I think it is much faster than wasting time without knowing what to do.
If you know in advance that you’ve got to work on, for example, 20 things out of a predefined list of 50 items for the project at hand, you can quicken things up and prevent mistakes.

The goal is to make Eiichi Shibusawa retire honorably

What would you like to achieve in the future?

I still vividly remember going overseas several years ago and seeing how cashless payment systems had penetrated the country I visited, and then thinking to myself, “This is the sort of future we are aiming for.” No one was using cash. Japan is still a long way from that, but I want to make sure it happens.

A new 10,000 yen bill with Eiichi Shibusawa on it, the founder of the Japanese economy, will be issued next year but I think the best way to repay him would be to have him leave the market. We would like to promote cashless transactions to the point where the 10,000 yen bill becomes obsolete, and have PayPay lead the way.

Cash still accounts for 40 to 50% of Japan’s personal consumption, with over 100 trillion yen spent annually. If we take the lead in this shift to cashlessness and get half the market share, we can increase our GMV by 50 trillion yen. We would definitely like to work strategically in this domain.

What do you consider important for the growth of your team members and the organization?

Since we primarily hire professionals in various fields, our premise is that employees will contribute to the growth of the organization by demonstrating their abilities to the fullest extent in their areas of expertise.
Because we rapidly run through the PDCA cycle when holding campaigns, employees here can gain experience in one or two years that would normally take three to five years at other companies. Naturally, this also leads to personal growth.

On the other hand, I would like our members to proactively get involved not only in their own areas of expertise, but also in related fields. I gather new business ideas and campaign proposals and have them furbished and ready for implementation regularly. Ideally, I would like to have 90% of their time and thinking devoted to matters they are competent at, while leaving 10% for taking on new challenges.

What skills are required of PayPay marketers?

Sensitivity to numbers and the ability to read and interpret numbers are essential.
Since PayPay is a payment company, it has a large amount of payment data and can reveal to some extent the situation of user spending. In the future, it may be possible to integrate merchants’ POS data to gather information on what consumers are buying and even information on the users’ income with the start of digital payroll. I believe that the ability to understand users and the market through this vast amount of data is a skill that is necessary not only for the marketing department but for all PayPay employees. PayPay is still growing, and we are waiting for daredevils who can change society together with us.

*The recruitment status is current at the time of the interview.

Special Thanks: Hirofumi Fujii / Editor: Moe / Author: PayPay Inside-Out Editorial Team / Photographer: Keizo & Yuki
*Employees’ affiliations are as of the time of the interview.