Connect with us

Entrepreneurship

The Asian Couponing Market

Published

on

In the world of commerce, the humble coupon has always maintained its place in the value chain. After all, who doesn’t want to pay a few dollars less, get free shipping or take home that exclusive free gift?

With a history dating back to the Gilded Age of the late 1800’s, the coupon has carried people through the depression, and has offered some degree of respite during the communist era. For a brief period in the 60’s the coupon even became the poster child of family togetherness, where Sunday morning coupon-clipping was a more popular activity than baseball or war protests!

History of coupons snippet

It has learned to evolve with the times, and has been flexible enough to adapt to the consumers ever changing needs. The coupon is nimble, and has to a degree, transitioned from print to digital in a seamless fashion.

Coupons are here to stay.

In fact, a recent study by GfK tells us that 70% of consumers in America still look to traditional paper-based coupons for savings. It’s not an old person thing to do either, as 63% of these users come from the millennial age category.

That’s right. Hipsters use coupons too!

Couponing and the Asian psyche

A little closer to home, the physical coupon scene stands in stark contrast to the norm of the West. You can pick up any newspaper from around the Asia region, and be hard pressed to find more than one tiny cut-out segment.

Promotional flyers are handed out freely on the streets and in malls but are rarely redeemable, and we curse out loud whenever a sneaky merchant tries to give us some savings over SMS.

Although we Asians are hard coded to always be on the look out for the best deals, and negotiate on the price of anything from fresh chicken in the market to multi-million dollar property deals, the whole notion of swapping a piece of paper for a discount seems foreign to us.

Without getting too cerebral, its safe to say that the traditional Asian consumer needs to bargain. He needs to feel that the vendor is cutting into his profits in order to feel better about making the purchase. He sees sales as not being real discounts – if a vendor can give him 20% off without breaking a sweat, that vendor is still making a healthy profit.

We brush off our constant haggling as nothing more than an exercise in prudent spending. Paying list price just does not happen.

On the surface, it seems that we treat coupons as taboo, but do the numbers agree?

Do the numbers agree?

At iprice, we receive more than one million visits a month. Almost half of that traffic either goes straight to, or ends up on one of our many coupon pages. With thousands of coupons redeemed everyday, the numbers alone contradict what we think we know about coupons.

Beyond the confines of iprice, Google also paints a similar picture.

We analyzed the search volume of the top 100 brands in our Malaysian store, and found that at over 80,000 searches were made last month just looking for coupons or discounts codes for these brands.

Across the seven countries that iprice operates in (MalaysiaSingaporePhilippinesIndonesiaHong KongVietnam, and Thailand), the total search volume shot up to a massive 740,000.

While we can’t peg an accurate number on the exact size of the digital coupon market in the region, the numbers certainly do speak for themselves. Put that against aCommerce’s estimated 2015 ASEAN e-commerce market valuation of US$7 billion, and the picture gets bigger. People want deals. People are searching for them. And people are certainly finding them online.

What fuels the need?

A surefire indicator that digital couponing is alive and well in Asia can be found in the way that our e-commerce habits have evolved. The proliferation of e-commerce into our everyday lives has pushed the pivotal moment further and further down the conversion funnel.

Conversion Funnel (iprice)

No longer are we caught staring wide eyed at a screen due to the amount of options that we have at hand – online malls like Lazada, Zalora and TaoBao have made access to over a million SKUs a regular daily occurrence. iprice currently lists over 8 million SKUs in our library.

Instead, we add item after item into our shopping carts, hover over the buy button and go back to our daily lives without checking out.

Digital advertising technology like programmatic banners constantly remind us about our overflowing carts while we’re scrolling through social media feeds, and weekly newsletters send us back to the online stores with the promise of bigger and better deals.

At the end of the month or when we buckle to temptation – whichever comes first – we click on the cart icon at the top right corner of our screens, look through the contents of our cart one last time and hit the next button.

Suddenly, a slew of random thoughts course through our heads – Do I really need this? Will he / she get upset that I’m shopping online again? Is this really the best deal that I can find?

Just then, we notice a blank field right above the pay now button.

Coupon code

Instinctively, we open a new tab in our browsers and key in the magical words –  “coupon code”. With our fingers crossed, we click on the first link that appears.

Get 30% off your cart with this code!

Jackpot! Switching back to our carts, we key in the code, hit pay and watch the magic happen. Suddenly we’re paying 30% less that we would have 30-seconds ago and all it took was a few extra clicks.

Conversion Funnel - Coupons (iprice)

The pivotal moment of online shopping has shifted along steadily with the evolution of e-commerce. It no longer sits at awareness, interest or even consideration. In today’s world, it sits firmly between intent and conversion, which is exactly where digital couponing just happens to live.

Are coupons worth the trouble?

On the iprice coupon page, you’ll find deals that range from nice to have things like free delivery, to seasonal offers of up to 50% discount from your cart total. As cliché as it sounds, there really is a coupon available for almost everything you can buy online, and our mission has always been to keep them organized and accessible to our users.

Coupon savings up to 25% on average

On average, an iprice user stands to save up to 25% just by using one of our coupon codes upon check out. Among the categories, the fashion category is the biggest savings contributor and offers an average discount of 30%. The second largest contributor is the mobile device / computer category which offers an average of 12% savings, and the travel category comes in third with an average discount of 7% across coupon codes.

Compare that to GOMSEC’s 2013 Asian e-commerce basket size estimate of US$1,268, and 25% in savings starts to look like a great deal.

Coupons from a merchant point of view

So, we’ve established that coupons are great for the consumer – it’s essentially free money for nothing more than a few extra clicks – but how does it benefit the merchant? Surely, earning as much as possible on every sale should be the goal of every business, shouldn’t it?

Well, yes and no.

After all, a steady stream of return customers at a reasonable profit margin is always more favorable that one-offs at higher margins. That’s just the way the retail world works.

Instead of looking at coupons purely as a way to offset profits for leads, merchants are starting to use coupons in more creative and brand centric ways. One of our favorite uses of coupons was championed by Uber, who provided free first rides worth RM40 (approx.. US$10) for new sign-ups through coupon codes.

Popular coupon searches on iprice

 

They weren’t giving away free money per-se, since the free gift actually required the user to experience their service in person. The free ride coupled with their strong product made first experiences memorable, and built lasting positive first impressions with new users.

In a retail e-commerce environment, first timer coupons are no less of a hit. Online boutiques – both big and small – offer larger than usual discounts on first time purchases. Marketplaces like Lazada offer instant cash back coupons for shopping through their recently launched mobile app.

Rewarding loyal users with coupons also helps to encourage evangelism, and the results can grow exponentially thanks to the wonders of social media.

Think coupons, think iprice

Built around the premise that online shopping should be much easier than it already is, iprice is constantly striving towards creating the best one-stop shopping destination for our shoppers. Our transition from being a pure couponing site in 2014, into the multi-faceted deal machine that it is today is a testament of our commitment.

Today, the iprice group of portals (MalaysiaSingaporePhilippinesIndonesiaHong KongVietnam, and Thailand) publishes daily coupons from 200 of Asia’s biggest coupon providers. The coupons are 100% verified by the iprice team, so you can rest assure of their quality and validity.

iprice is also an e-commerce discovery platform, and has successfully signed on over 100 merchants this year. The portals currently list over 8 million products across a number of categories include electronics, clothing, shoes, bags, watches, jewelry, toys, sports and home & living.

In an effort to grow the regional coupon market, iprice has recently partnered with REV Asia to produce a series of coupon sites on their biggest web properties such as SAYS.com.

Callum Connects

Benjamin Kwan, Co-Founder of TravelClef

Published

on

Making music to create a life for his family, Benjamin Kwan, started an online tuition portal and his music business grew from there.

What’s your story?
I am Benjamin and I’m the Co-Founder of TravelClef Group Pte Ltd, a travelling music school that conducts music classes in companies as well as team building with music programmes. We also run an online educational platform which matches private students to freelance music teachers. We also manufacture our own instruments. I started this company in 2011 when I was still a freshman at NUS, majoring in Mechanical Engineering.

I was born to a lower income family, my father drove a taxi and was the sole breadwinner to a family of 7. I have always dreamed of becoming rich so that I could lessen the burden placed on my father and give my family a good life.

After working really hard in my first semester at NUS, my results didn’t reflect the hard work and effort I put in. At the same time, I was left with just $42 in my bank account and it suddenly dawned on me that if I were to graduate with mediocre results, I would probably end up with a mediocre salary as well. I knew I had to do something to gain control of my future.

During that summer break, I read a book “Internet Riches” by Scott Fox and I knew that the only way I could ever start my own business with my last $42 would be to start an online business. That was how our online tuition portal started and after taking 4 days to learn Photoshop and website building on my own, I started the business.

What excites you most about your industry?
Music itself is a constant form of excitement to me as I have always been an avid lover of music. As one of the world’s first travelling music schools, we are always very eager and excited to find innovative ways to a very traditional business model of a music teaching.

What’s your connection to Asia?
I was born and raised in Singapore and I love the fact that despite our diversity in culture, there’s always a common language that we share, music.

Favourite city in Asia for business and why?
Hands down, SINGAPORE! Although we are currently in talks to expand to other regions within Asia, Singapore is the best place for business. I have had friends asking me if they should consider venturing into entrepreneurship in Singapore, my answer is always a big fat YES! There’s a low barrier of entry, and most importantly, the government is very supportive of entrepreneurship.

What’s the best piece of advice you ever received?
I have been blessed by many people and mentors who constantly give me great advice but right now, I would say the best piece of advice that I received would be from Dr Patrick Liew who said, “Work on the business, not in it.” This advice is constantly ringing in my head as I work towards scaling the business.

Who inspires you?
My dad. My dad has always been my inspiration in life, for the amount of sacrifices that he has made for the family and the love he has for us. He was the umbrella for all the storms that my family faced and we were always safe in his shelter. Although my dad passed away after a brief fight with colorectal cancer, the lessons that he imparted to me were very valuable as I build my own family and business.

What have you just learnt recently that blew you away?
You can not buy time, but you can spend money to save time! With this realisation, I was willing to allow myself to spend some money, in order to save more time. Like taking Grab/Uber to shuttle around instead of spending time travelling on public transport. While I spend more money on travelling, I save a lot more time! This doesn’t mean that I spend lavishly and extravagantly, I am still generally prudent with my money.

If you had your time again, what would you do differently?
I would have taken more time to spend with my family and especially my father. While it is important to focus our time to build our businesses, we should always try our best to allocate family time. Because as an entrepreneur, there is no such thing as “after I finish my work,” because our work is never finished. If our work finishes, the business is also finished. But our time with our family is always limited and no matter how much money and how many successes we achieve, we can never use it to trade back the time we have with our family.

How do you unwind?
I am a very simple man. I enjoy TV time with my wife and a simple dinner with my family and friends.

Favourite Asian destination for relaxation? Why?
Batam, it’s close to Singapore and there’s really nothing much to do except for massages and a relaxing resort life. If I travel to other countries for shopping or sightseeing, I am constantly thinking of business and how I can possibly expand to the country I am visiting. But while relaxing at the beach or at a massage, I tend to allow myself to drift into emptiness and just clear my mind of any thoughts.

Everyone in business should read this book:
Work The System, by Sam Carpenter. This book teaches entrepreneurs the importance of creating systems and how to leverage on systems to improve productivity and create more time.

Shameless plug for your business:
If you are looking for a team building programme that your colleagues will enjoy and your bosses will be happy with, you have to consider our programmes at TravelClef! While our programmes are guaranteed fun and engaging, it is also equipped with many team building deliverables and organizational skills.

How can people connect with you?
My email is [email protected] and I am very active on Facebook as well!
https://www.facebook.com/benjamin.christian.kwan

This interview is part of the ‘Callum Connect’ series of more than 500 interviews

Callum Laing is an entrepreneur and investor based in Singapore. He has previously started, built and sold half a dozen businesses and is now a Partner at Unity-Group Private Equity and Co-Founder of The Marketing Group PLC. He is the author two best selling books ‘Progressive Partnerships’ and ‘Agglomerate’.

Connect with Callum here:
twitter.com/laingcallum
linkedin.com/in/callumlaing
Download free copies of his books here: www.callumlaing.com

Continue Reading

Entrepreneurship

Before you enter a Startup or before you choose your founding team or new hires read, “Entering Startupland” by Jeff Bussgang

Published

on

Before you enter a Startup or before you choose your founding team or new hires read “Entering Startupland” by Jeff Bussgang.

Jeff knows how to spot and groom good culture, as the book session was held in Zestfinance a company he invested in and now, “The Best Workplaces for Women” and for “The Best Workplaces for Tech”, by Fortune.

These are the questions during the Book Launch.

How to know if a hire including the founder is Startup material?
Jeff says to watch for these qualities.

First, do the hires think like an owner?
Second, do the hires test the limits, to see how things can it be done better?
Are they problem solvers and are biased toward action?
Do they like managing uncertainty and being comfortable with uncertainty? And comfortable with rapid decision-making?
Are they comfortable with flexible enough to take in a series of undefined roles and task?

How do we know if we are simply too corporate to be startup?

Corporate mindsets more interested in going deep into a particular functional area? These corporate beings are more comfortable with clear and distinct lines of responsibility, control, and communication? They are more hesitant or unable to put in the extra effort because “it’s not my job”.

If you do still want to enter a startup despite the very small gains at the onset, Jeff offers a few key considerations on how to pick a right one.

He suggests you pick a city as each city has a different ecosystems stakeholders and funding sources and market strengths. You have to invest in the ecosystem and this is your due diligence. Understand it so you can find the best match when it arises.
Next, to pick a domain, research and solidify your understanding with every informational interview and discussion you begin. Then, pick a stage you are willing to enter at. They are usually 1)in the Jungle, 2) the Dirt Road or 3) the Highway. The Jungle has 1-50 staff and no clear path with distractions everywhere and very tough conditions. The Dirt Road gets clearer but is definitely bumpy and windy. Well the Highway speaks for itself, doesn’t it?

Finally Please – Pick a winner!

Ask people on the inside – the Venture Capitalists, the lawyers, the recruiters and evaluate the team quality like any venture capitalists would. Would you want to work for the team again and again? And is the startup working in a massive market? Is there a clear recurring business model?

After you have picked a winning team and product, how would you get in through the door?

You need to know that warm introductions have to be done. That’s the way to get their attention. Startups value relationships and people as they need social capital to grow. If you have little experience or seemingly irrelevant experience, go bearing a gift. Jeff shared a story of a young ambitious and bright candidate with no tech experience who went and did a thorough customer survey of the users of the startup she intended to work with. She came with point-of-view and presented her findings, and they found in her, what they needed at that stage. She became their Director of Growth. Go in with the philosophy of adding value-add you can get any job you want.

And as any true advisor would do, Jeff did not mince his words, when he reminded the audience that, “If you can’t get introduced you may not be resourceful enough to be in startup.”

Startupland is not a Traditional Career or Learning Cycles

Remember to see your career stage as a runs of 5 years, 8 or 10 – it is not a life long career. In Startup land consider each startup as a single career for you.

Douglas Merrill, founder of Zestfinance added from his hard-earned experience that retention is a challenge. Startup Leaders to keep your people, do help them with the quick learning cycles. Essentially from Jungle to Dirt road, the transition can be rapid and so each communication model that starts and exists, gets changed quickly. Every twelve months, the communication model will have no choice but to break down and you have to reinvent the communication model. Be ready as a founder and be ready as a member of the startup.

Another suggestion was to have no titles for first two years. So that everyone was hands-on and also able to move as one entity.

Effective Startupland Leaders paint a Vision of the Future yet unseen.

What I really enjoyed and resonated with as a coach and psychologist was how Douglas at the 10th hire thought very carefully what he was promising each of his new team member. He was reminded that startups die at their 10th and their 100th hires. He took some mindful down time and reflected. He then wrote a story for each person in his own team and literally wrote out what the company would look like and their individual part in it. In He writing each of the team members’ stories into his vision and giving each person this story, it was a powerful communication piece. He definitely increased the touch points and communication here is the effective startup’s leverage.

Douglas and Jeff both suggested transparency from the onset.

If you think like an owner and if you think of your founding team as problem solvers. Then getting transparent about financials with your team is probably a good idea. As a member of a startup, you should insist on knowing these things
Such skills and domain knowledge will be valuable. There is now historical evidence of people leaving startups and being a successful founder themselves because they were in the financial trenches in their initial startup. Think Paypal and Facebook Mafia.

What drives people to enter a startup?

The whole nature of work is changing. Many are ready to pay to learn. Daniel Pink’s book Drive showed how people are motivated by certain qualities like Mastery, Autonomy and Where your work fits into big picture. Startups do that naturally. There is a huge amount of passion and the quality of team today and as it grows then the quality of company changes.

The Progress principle is in place, why people love their startup jobs is not money rather are my contributions being valued? Do I see a path of progress and do I have autonomy over work and am I treated well?

Find out more about StartupLand on Amazon

And learn from Zestfinance

Continue Reading

Trending