A South Korean mobile payment application is deploying a back-to-back "click and go" growth strategy to stimulate the adoption of the retail business.
Rather than launching an advertising blitz or sending an army of robots to argue their case on social media, Terra Blockchain's CHAI solution focuses on where customers actually buy.
Founder David Shin told CoinDesk that his customers were attracted to a network of popular online merchants accepting CHAI, including one of the largest Korean e-commerce sites, TMON, which Shin had founded and chaired, as well as the online craft market Sinsang Market and the streaming music service Bugs.
The application claims about 500,000 registered users, two-thirds of whom return monthly, and loyal customers spending an average of $ 19 per visit. Since its launch in June, CHAI has released daily figures of about 40,000 users, said Shin, with total expenditures exceeding $ 54 million.
"It's not like we've captured those users who had tried it once, thought it was great and found their existing products."
Online, this will become a reality when the Korean convenience store CU starts accepting payment by CHAI at its 14,000 locations in December.
Design better payments
Terra's payment rail is based on two separate cryptos: the terra stablecoin for the transfer of funds on the network and a token, Luna, held by the minors giving them the right to small transaction fees, between 0.1 and 1% , according to the Terra White Paper.
"Terra and CHAI have been meticulously engineered from day one to promote mass adoption and deliver the right kind of value, to inspire millions of customers to use it," said Shin.
The giants arrive however. The stable group needed to maneuver the major digital payment systems in Korea such as Kakao and Samsung Pay. Koreans may be more accepting of digital payments than others, but a report by the Asian Institute of the Development Bank further indicates that 70% of mobile point-of-sale payments are still linked to credit cards.
Koreans have adopted digital payment reports, which indicated that in the first half of 2018, 70% of payments from mobile outlets were still linked to credit cards.
For Terra, Shin explains that the advantage lies in the credit card fees that charge suppliers up to 3% per transaction. By channeling these payments through Terra's blockchain, Terra reduced merchant fees to 1% or less, saving suppliers $ 810,000 in the first four months.
"Our value proposition is exactly what these merchants are looking for," said Shin.
The payment application received funding of $ 32 million in the summer of 2018.
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