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Hooray,
Yehey!
By Michael Alan Hamlin
May 27, 2003
Technology and the Internet are respectable
again. Confirmation came first in a trickle, as stories began popping
up here and there that online publishers, portals, B2C, and B2B
initiatives are not just experiencing an increase in revenues, but
are actually becoming profitable. In recent weeks, the trickle has
transformed. Not into a hoped-for flood, perhaps, but certainly
a steady stream of pretty doggone good news.
Earlier this month BusinessWeek
trumpeted "The e-Biz Surprise," announcing that the bubble
wasn't all hype after all. In fact, "for companies as well
as consumers," the authors gushed, "e-commerce is hotter
than ever." Somewhat belatedly, Fortune got into the
act last week, putting the enduring Jeff Bezos on its cover, and
proclaiming the not-long-ago beleaguered B2C pioneer an oracle.
Indeed, Amazon.com will enter the
ranks of the top 40 U.S. retailers this year, and e-Bay is already
in the top 15. And the value of U.S. e-business transactions has
dwarfed projections of US$1.3 trillion in 2003 made at the peak
of the technology bubble. It's already US$2.4 trillion, prompting
Intel chairman Andrew S. Grove to tell BusinessWeek, "Everything
we ever said about the Internet is happening."
And guess what? Similar examples
evident in the Philippines. Although every local e-marketplace but
one quickly disappeared in the aftermath of the dot-bomb, BayanTrade
has survived to become what its president and COO Dante Briones
calls a "financially viable company." Getting to that
point required regularly fine tuning the BayanTrade business model
and in the process transforming the company from what was originally
intended to be a public marketplace into an e-sourcing and e-procurement
services firm that provides e-commerce infrastructure and expertise.
There are also success stories in
the B2C sector. Among them is Yehey!, a content-driven portal that
director Juan Chua says is now profitable (Full Disclosure: BayanTrade
and Yehey! are clients of my firm.). Those familiar with Yehey!'s
history know that - like BayanTrade - its present-day success required
making a number of tough decisions, and a relentless pursuit of
best management practice.
Among those changes was the departure
of the entire founding management team. While these founders were
certainly visionary in their own right, they lacked the management
skills necessary to transform the venture into a going concern.
That's a pretty common history among dot-coms, the difference being
that most didn't survive the change in management teams.
But today, Yehey! boasts 17 million
page views per month, and a registered user database of over 200,000
regular visitors who spend time on the site because they truly value
its content. But the changes continue. Fine tuning the business
model for Yehey! most recently involved the development of a payment
gateway that enables users to make secure purchases over the Internet
using ATM cards. Says chief technology officer Jason Banico, "there
are only three million credit card holders in the Philippines, which
provides a very small base for B2C. But there are 14 million ATM
cards in regular use."
Yehey! doesn't intend, however, to
become a B2C site itself. Instead, it enables e-commerce by making
the payment gateway - dubbed PayPlus+ - available to bona fide online
merchants in return for a percentage of the transaction. To help
merchants build their online presence and sales, Yehey! has developed
an aggressive marketing strategy leveraging the portal's strong
daily traffic and its database of registered users.
"Registered users can sign up
to receive regular notices of new products and promotions from our
merchants," says Kevin Khoe. There are a number of advantages
associated with marketing to this group. First, it's a receptive
audience, which has indicated it wants this type of information.
Second, it's also very focused: users are comfortable with the Internet,
and are therefore likely to be disposed to making online purchases.
Third, communications can be personalized, making them extremely
compelling.
Although the service is new, early
results are encouraging. Merchants such as Island Rose - a pioneer
in the Philippine cut flower industry - have been quick to leverage
the benefits of online ATM purchases. The company previously provided
online purchases by credit card exclusively using a U.S. payment
gateway. As a result, customers were billed in dollars. That meant
that most customers turned out to be U.S.-based Filipinos, who would
purchase flowers online for special occasions, with instructions
that they be delivered to relatives in the Philippines.
With PayPlus+, Island Rose customers
in the Philippines can purchase flowers in pesos for relatives anywhere
in the world. The advantages are convenience and savings on foreign
exchange conversion for customers; and for Island Rose, a truly
viable local marketplace. Seeing PayPlus+ used in a beneficial way
by merchants and their customers must be rewarding for Yehey! But
the company has also received other forms of recognition.
Last year, Microsoft recognized the
innovation and market relevance of PayPlus+ by naming it Asia's
most innovative homegrown application. What must make this recognition
especially meaningful to the Yehey! team is that it comes amidst
what can only be described as an orgy of news about technology innovation
in Asia's giants, China and India. But Yehey! has proved you don't
have to be biggest to be best.
Hooray, Yehey!
(Michael Alan Hamlin is the managing
director of consultancy TeamAsia and the author of three books on
Asian economies and companies. His latest book is Marketing Asian
Places, of which he is a co-author (Wiley, 2001), and he is currently
at work on High Visibility: The Making and Marketing of Asian Professionals
into Celebrities. Write him at mahamlin@teamasia.com.).
Copyright © 2003 Michael Alan
Hamlin. All Rights Reserved.
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