Zerodha's Nithin Kamath on increasing brokerage firm ads during IPL, ‘Often get asked why we don't advertise…’

Zerodha co-founder Nithin Kamath engaged with followers on the social media site X (formerly known as Twitter), stating that he saw increased advertisements by a brokerage firm during the Indian Premier League (IPL) matches.

“I watched a cricket match after a long time, and damn! Every fourth ad is that of a brokerage firm. Sign of good times for the markets,” he quipped.

In a post on May 21, Kamath also shared the reason why Zerodha does not advertise its platform.

“I often get asked, both internally and externally, why we don't advertise. It is a good place to be when you don't have to look at customers in terms of customer acquisition costs (CAC) and lifetime value (LTV). This way, we don't have to push customers to take a trade, we can stay spam-free, not have to sell life insurance as an investment, and more,” he added.

Netizens React With Agreement, Sarcasm, Advice

Kamath's post triggered a host of responses from followers and Zerodha users who either agreed with him, gave advice, offered feedback, or just disagreed. Multiple users also brought up glitches experienced while using Zerodha services, and while all were not fans, some said they were looking forward to the fintech startup's offerings.

“Yes, one good thing about Zerodha is that it never pushes customers to take a trade, give tips or sell other services. One bad thing about Zerodha is that it gives glitches in times of Volatility. Right?” wrote one Z user.

On the same topic, another gave Kamath advice on keeping existing customers and said: “That’s what I like about Zerodha. But these days, I've been hearing a lot of negative remarks about technical glitches and service disruptions, which may be impacting existing customers, atleast as heard on X. So, it’s cool not to look for new customers, but maintaining a similar customer base would be quite challenging. While I love the platform and would love to see what new features you are bringing in.”

Others were sceptical of Kamath's claims of “no ads”, stating that his social media post itself generates buzz: “They (Zerodha) do. This tweet is one of them. The competition brokers are lagging behind in this strategy, too.”

People were also thankful: “Thank you for not selling life insurance as an investment.”

And others opined that with increasing competition, the no-advertising rule may have to go or bend. “I think going forward, you will need to advertise. This segment had zero competition when you started, but now it has cut throat competition and need recall value to remain relevant,” said one user.

Another was confident about Zerodha's brand value: “While others are playing ads, you're playing it cool. Less noise, more value! Who needs ads when your service is as popular as the IPL finals?”

Notably, as of September 2023, Groww had overtaken Zerodha as the top brokerage firm in India in terms of more active investors. As per NSE data, by September 2023 end, Groww had 6.63 million active investors, whereas Zerodha had 6.48 million.

Meanwhile, Angel One ranked third with 4.86 million active investors, segment newcomer Upstox took fourth spot with 2.19 million active investors, and ICICI Securities rounded up the top five with 1.91 million clients.