From: http://www.mb.com.ph/articles/361669/netting-it-big-in-the-wild-west
Netting It Big In ‘The Wild West’
Social networking site Multiply has evolved
from being an online venue for people to connect and interact with each
other, into a powerful business enabler for aspiring entrepreneurs
June 11, 2012, 2:30pm
Stefan Magdalinski, global CEO of Multiply.
What began in the mid- to late-2000s as an online venue aimed at linking people with family and friends has organically evolved into a thriving online marketplace when a growing number of members started using such features as photo sharing and advanced customization to create storefronts for their budding online businesses.Today, with a network of over 5.5 million users and over 106,000 storefronts across 16 product categories, Multiply has become the largest online marketplace in Southeast Asia and a powerful business enabler for aspiring entrepreneurs.
Interestingly enough, its loyal community of Filipino members led Multiply’s evolution. Upon its acquisition in 2010 by Naspers, a media conglomerate with a strong presence in South Africa, the company noted the number of growing members using the photo album feature to set up online shops. “Originally, doing commerce in the social network platform was against the Terms of Service (TOS), and when we realized that this was what people wanted to do with the platform, we decided to change the TOS and increased the focus on e-commerce,” shares Stefan Magdalinski, global CEO of Multiply.com.
Empowering Entrepreneurship
When asked what made Naspers decide to acquire Multiply among other social networking sites in the Internet today, Magdalinski shares that Multiply fits Naspers’ philosophy of investing in emerging markets. “When we’re looking for companies to invest in, we’re not like venture capitalists who invest in the very early stages of business. We look at a business that has a good idea [behind it] that’s gaining traction in emerging markets, and if we invest in it, we can make it grow a lot faster,” he explains.
What Multiply is doing now, “and what I’m going to continue,” Magdalinski shares, “is a process of keeping all the social networking features that members love but also making it the best platform in the world for people to run a small business on.” With upgraded features for both shoppers and merchants, Multiply users can now enjoy the convenience of a virtual shopping cart that enables them to shop from multiple merchants and pay in a single check-out transaction.
Security issues are addressed via the Buyer Protection Program, which guarantees purchases from Trusted merchants. “Anyone can sign up in Multiply to open a store, but if you sign up, we do some vetting on the business to give us more information about you,” explains Magdalinski. Once verified, he adds, a merchant will be awarded a trusted seller badge. “There are more stringent controls in place,” he assures.
Competition
In ‘The Wild West’
According to Magdalinski, his new post as global CEO of Multiply feels, in some ways, like going back to his roots. “I come from the U.K. and I was involved in the early days of the Internet there—the early days of e-Commerce, and this market (Southeast Asia) is still very much about getting people to transact online for the first time. And that requires delivering a different kind of site and experience from someone who’s making their fiftieth or hundredth online purchase. Here [in Southeast Asia] it needs to be much more about building trust,” he shares.
With a market that’s far from reaching saturation, Magdalinski says that going head to head with other e-commerce websites is not an issue—yet. “It’s the wild west out here,” he says. “It’s the very early days and there’s a huge market opportunity for all the players. In a few years time, when the market gets saturated, then we’ll all start competing with each other for the same audience. But now, for all players, it’s really about growing the market,” he explains.
What e-Commerce players are really competing for, Magdalinski asserts, is a share in people’s disposable income. “I tend to look at competition in a bigger picture, because when you look at the Philippines where about one percent of all commerce is done on the Internet, and I’m worried about competing [with another company] for a share of that one percent, I’m leaving 99 percent on the table,” he says.
Multiply’s current agenda is just to deliver a seamless online buying experience that will get users to keep coming back. “E-commerce is really simple—it’s all about price, selection and convenience; and as a company, we have to address these aspects,” Magdalinski states. “Price and selection is easy,” he adds, “because they’re very straightforward. Everybody wants prices to be cheaper so you want to make them as cheap as you can without getting [your business] into trouble. And everybody wants more selection so that’s also very easy—you just have to attract the right kind of merchants who are selling in areas where you have gaps,” he says.
Convenience is where it gets complicated, and is also where Magdalinski believes all the competition will eventually happen between commerce players. “This makes up the user’s experience, which covers how good your checkout, payment methods and delivery are, how you make it easy for them to repurchase, etc., and a big part of that is really building trust,” he says, “so as a company, it’s about making sure that we do a better job at all those components than the competition.”
With the e-Commerce market expecting to grow at more than 40 to 50 percent per year, Magdalinski says it is essential that Multiply’s year-on-year growth exceeds that number. “Given how fast people are joining the Internet, growth in itself is not enough. Because if the market is growing at 40 percent per year, and you’re growing at 20 percent, you’re still losing market share. So,” he concludes, “you have to be outstripping everybody else.”
