Chinese IPO in Malaysia

Do you know that Malaysia is one of the target countries for China companies to raise capital?

There are already 3 China-based companies which listed in Bursa Saham; they are Xingquan (Shoe maker), Multi Sports and Xideliang.

And there are a slew of other China companies awaiting their IPO listing with the Bursa; China Haikul Ltd (Seafood Products and Manufacturer), K-Star Sports Ltd (Sports footwear maker), Sozo Global Ltd (Convenience Food Producer), Fashion International Holdings (Design and Marketing Menswear), China Ouhua Winery Holdings Ltd (Wine maker for Chinese and foreign labels), and Asia Paper International Holdings (manufacturer of testliners).

A couple of things we need to consider here with regards to the Chinese stocks;

1. There are a couple of accounting fraud cases from Chinese listed companies in Singapore, making fund managers wary about the credibility of Chinese accounting practices

2. The companies that are listed or applying for listing are companies in the lower rung of value chain. Yes they are growing fast because of the cheap goods they are offering but such companies usually are not ble to sustain their competitiveness for a very long time.

3. They are currently under the radar among the fund managers due to the above. Not only that, their shares had all since listing fallen lower than their IPO price. Xingquan price current price is RM1.15, compared to its IPO RM1.71. Even though their PER is around 3 or less they do not seem to be able to attract interested parties. In fact Multi Sports' initial investor, the Quek Leng Chan's family's GuocoLine Group Managmenet Co. Ltd sold their stocks shortly after its listing.

One very interesting thing about China companies listing here is that, some financial analysts were invited to go to China to visit their manufacturing sites and all to understand more about the companies, these analysts decided to discontinue their research after this initial reports of their visit.

So to invest or not to invest in China-based local stocks? May the buyers beware.

Ipad- The Battle of Writing Review

OK, if I were to talk about Ipad which even only after 4 days since its unveiling by the legendary Steve Jobs, I would be the last person to do so, because almost everybody would have talked and reviewed and even criticize(albeit rarely) it.

So what am I to talk about anyway? All I can say is that I am late. And in this world where where things fly like the speed of light, you can only balk at the loser you are for this.

All I can say is that smartphones are just overrated, yes I am talking about smartphones instead; who wants to own a small handheld to read emails, surf the net, and prepare a powerpoint presentation? Even updating facebook is just a fad which will end anytime soon; look at how people begin to get frustrated with updating the twitter, even celebrities are quitting twitter, one popular friend I know who used to update his Facebook and Twitter almost every other hour now has gone total MIA. The only thing I can think of using the smartphone is to read the stock price movement of my choice.

Now the solution to the absurdity of a smartphone is Ipad. I love it, it could be my personal journal, and my personal assistant that I can easily scrawl my mind and work a presentation. It's the combination of smartphone and netbook. Having a battery lasting a month is definitely a great attribute coming from it.

Aside from the overusing of the letter "i", stretching the imagination with iPad this time (elicited chuckles among the fantasizing ladies, and some guys) I think the key learning points from here is, do we really need Steve Jobs to get a market going? Haven't we done the Tablet PC long time before?

Or is it circumstantial? That now is the better time to launch a touchscreen gadget of any size than before, that Steve Jobs launch it at the right time, that he's just lucky? Just like James Cameron waiting for the right time to direct Avatar although like what he told us, he's been writing Avatar since the 80's?

Amazon Top 10 books of 2009

Let's pry into the demographic of the netizens by the books they read.

Because this is from Amazon's which constitutes majority of internet purchase in the world, we can safely say that we are looking at the psychosocial trend of the population who have access to the net.

1. The Lost Symbol, by Dan Brown
2. Liberty and Tyranny: A Conservative Manifesto, by Mark R. Levin
3. Glenn Beck’s Common Sense: The Case Against an Out-of-Control Government, Inspired by Thomas Paine, by Glenn Beck
4. Act Like a Lady, Think Like a Man: What Men Really Think About Love, Relationships, Intimacy, and Commitment, by Steve Harvey
5. The Help, by Kathryn Stockett
6. Eat This Not That! Supermarket Survival Guide: The No-Diet Weight Loss Solution, by David Zinczenko
7. Diary of a Wimpy Kid: The Last Straw, by Jeff Kinney
8. Dead and Gone (Sookie Stackhouse, Book 9), by Charlaine Harris
9. The Last Olympian (Percy Jackson & the Olympians, Book 5), by Rick Riordan
10. Cook Yourself Thin: Skinny Meals You Can Make in Minutes, by authors from Lifetime Television

The list looks like a mash of diversified taste, from popular friction (Da Vinci's Code's sequel), politics (Mark Levin, Glenn Beck), self-help, nutrition and diet, kids's book, and fantasy.

So in order to decipher from the confusing array of genre, we interpret the result by what is NOT in the list, in my humble personal opinion;

1. Love story - netizens just not the lovey dovery kind

2. Left-wing political commentators - bunch of republicans the netizens are

3. Foreign relations and globalization - "no more Friedman please, we know the future is now"

4. Business book - businessman are just not into buying books, or reading books? hmm probably downturn time people are swarmed by the MBA textbooks they have to read, I know I do ;(

5. Books from movies - that is so last decade

Domino Tastes Like Cardboard?

Well, I do not espouse myself as the refined palate sort of guy but I actually love Domino Pizza, more than other brand of pizza.

So I am very surprised Domino Pizza actually took the trouble with revamping the whole recipe of its pizzas.

Mean to say, if you demonstrated a definite and differentiated value, in Domino's case, efficient home delivery service, doesn't matter if your food sucks, you still can achieve the 2nd biggest player in the food market.

Ad Spending has Gone Up, But Internet Marketing Remains Low

Ad spending in Malaysia in the year 2009 of RM6.6billion (USD1.94bil) is better than 2008 by 7% according to AC Nielsen? That's rather surprising considering ad spending in more developed countries expected to fall in the same time period. Ad spend in America is estimated to fall as much as 14.5% according several resources.

Newspaper, the ad spend leader has managed to still chart a growth of 2.6% albeit commanding a giant 51.6% cost of total ad spend.

In addition to that, Internet spending is not the main driver to this, it's radio. internet spending just consist of 0.6% of the total ad spend. Radio commands 5.5% of the ad spend pie and grew by 24.2%, faster than internet's 21.6%, which is the second fastest. For its low base, it's very surprising marketers adoption of the internet as a source of cheap and targeted communication is not taken as well as it should in this part of the world. In the US, internet consists of 7.6% in 2007 of total ad spend. The reason is not hard to find, the adoption rate of Malaysia's broadband has not reach satisfactory rate as we hope, not to mention the frustration 90% of internet users here of the broadband speeds they experience compares to what they are offered.

All in all, companies in Malaysia seems to dust themselves up fast from the economic mess and able to rebound fast in hounding the people with their intended messages.

Mobile Marketing Strategy is in full force

GQ has been working with Apple iPhone on its mobile magazine. Cost USD 2.99 it has sold over 6000 copies on the first month, and 12,000 on the second month; a far cry from their hardcopy circulationo of up to 500,000 copies.

Other magazines like Esquire are also going in the same direction. It has begun. Convergence is inevitable.

Welcome to the new age. Marketers prepare you bullets. Be the first to go in.

But I am not done yet, this mobile magazine launch is a preparation for the launch of Apple's tablet, named boringly AAPL, you should be able to read it this coming thursday.

Contextual Programming in Radio

Do you ever wonder if your friendly radio station could strategically place your radio ads at the right time where you want them to, optimizing message delivery to your target market?

My company pay a fortune to radio stations only for them to slot our ad at their discretion. This means although we were guaranteed that our ad will be occasionally heard during the peak hours , but many times, those investments will leak through the cracks through insertions at questionable time slots.

We know sometimes, if you have more money to waste, you could dictate the radio channels to specifically place the ad at the most strategic slot. (this means what we buy usually are promotional price stuffs, radio company sell those slots cheap just to fill up their empty slots)

Sometimes, advertisers who are even more loaded pay radio channels to repeat the ad back to back. This is obviously more expensive but more listeners would notice it.

So it would come as a rather big surprise that radio channels in the US have not been able to place the ad on a specific programme basis; aka ad is placed just after a specific programme or song. I know album ads were broadcasted right after the song from the respective album was played, reminding listeners to buy the album if they loved what they hear. (of course nowadays people do not do ad albums due to declining sales from piracy)

Clear Channel Radio in US claimed to pioneer this contextual ad programming, similar to what we were doing all this while. So far only Walmart, Geico and Visa had subscribed to this "innovative" platform. Maybe the reason why US could not adopt this technique earlier is radio stations there are heavily fragmented; there are hundreds if not thousands of radio stations there, which make it hard to coordinate ad programming of such nature. I could drive for less than an hour leaving Los Angeles, and lost the radio station, and start hearing new radio stations when I reach Sacramento.

In Malaysia, anywhere you go, you can still hear your favourite radio station, although you need to change the radio frequency.

Magazine Ad Revenue is falling

Magazine ad is falling at an average of 17%

But gossip, women and food magazine manage to buck the trend though.

This graph is interesting.

Check out quantcast.com to find out the traffic to those sites.

Not only facebook has the highest users among the social network, but also users there spend much more time in the site.

Facebook has reach a tipping point of no return. It's very hard to beat this site. The only way is to grab as many NEW users as you can, or convince facebook users to open another account in your site.

Infolient Market Niche

Malaysia has many internet service providers; Streamyx, Maxis, Celcom and Digi. They are so big that barrier for new entry is too large for any competitors; what can I do to beat those competitors? This industry will become more competitive with the entry of WIMAX providers like P1 etc.

Infolient however asked a different question; where are the untapped market the big ISPs have not targeted?

Service provider since 2006, Infolient targets the uncharted territories like Kelantan and small towns in Perak. All they need are small budget access points (consists of chips and motherboards; they assemble, configure and programme those access point and lay them at strategic sites around those area (each access point only cost them RM5k to Rm10k) and a strong marketing team to make a good business model.

It is still left to be seen whether Infolient can survive with it's current strength. Jaded consumer might question the reliability of the connection promised by them. Moreover the homepage touting 'Nationwide Coverage' is rather misleading. We'll probably gonna hear more of Infolient in the future whether, with oversea experience working in large company like Comcast and with the trust of the state governments, the leaders there can trigger a spark for bigger things.

Sony is a failure

I remember 10 years ago complaining to the customer service about my CD Walkman that is faulty when used for the first time. The customer service asked me to go all the way to the factory to fix it, and then after telling me they could not fix it, I left but asked them at least provide me warranty extension for a couple of weeks which I spent commuting between my campus and the factory several times just to get this not fixed.

The proud guy at the other line brushed me off by saying "sorry we can't do that, bye". Since then I vowed never to buy Sony products and I discouraged my friends to do so.

Nexus One by Google

 

Google is making a lot of inroads these days. Just recently they launched their Google Chrome browser which in here, was touted to be the fastest browser around. Later they will launch their own Chrome OS-installed netbook.

Today Google is giving Apple a run for its money by launching its own Android-system smartphone, Nexus One(pic).

Such inroads can only be done by a company with huge mullah to boot.

It’s also a good news for the consumer as Apple, although so far an admirable and much-loved company still has some kinks to sort out. First and foremost is the price; price are meant to sieve out the ins from the outs. What happens when everyone wants to be in? Will Nexus One be their saviour?

Second, Apple only works with certain telco provider for voice and data service, meaning if you want to continue with your DIgi, you have to pay the buck for the phone.

So if you think there’re roughs you need sorted out in the internet world, trust Google to smooth it out.

Honda Innovative Radio Ad

Honda Christmas and New Year's Ad is rather innovative. Notice the whistle at the beginning of the radio ad.

Amongst the mundane and monotonous sound of radio ad, this whistle suddenly awaken the listless listener from their concentration of work, from their mind-wandering, and then take notice.

And most powerful of all, anytime they hear this whistle they think of Honda. For a brand which people strongly associate with quality, all the ad need is just a reminder of its name.

Key Selling Proposition of a restaurant

If you are opening a restaurant, what will be your key selling propositions?

If you decide that your food is your core selling propositions, I suggest you rethink before jumping ahead.

Food is rarely a key selling propositions of a restaurant these days. The nasi lemak kampung and chau kueh tiau from the famous joints took many many years to establish themselves. If you want to be successful by getting people to talk about your food, you might as well prepare yourselves for a long ride.

Restaurants sell tasty food but also most importantly serve fringe benefits like mesmerizing ambience(like Starbucks), speedy food delivery (like Mc Donalds), great meeting up place(like Steven Corners), and ideal Football joint (like many mamak stores) .

OK so maybe fine dine should emphasize on their food as key selling proposition, but for lower cost restaurants, people look at something else. Just remember this, they are never gonna come frequently to your place just because of your food. They come frequently because you have variety, you have WIFI, you have good air-condition, you have excellent service , or even pretty waittresses, etc.

Think like that, you may have just found yourselves another Old Town White Coffee.

China CEO: Voices of Experience Part 1

There are essentially many books written doing business in China. Juan Antonio Fernandez, a management professor and Laurie Underwood, a business journalist's China CEO: Voices of Experience from 20 International Business Leaders interviewed 20 global companies' top executives plus 8 consultants in China. These companies come from diverse range of industry(retail, finance, pharmaceutical) and with wide duration of business experience(Standard Chartered has been around since the 1920's)

I will present here a couple of snippets from what I gather from this book. Starting with the strategy to invest in China.

To JV or not JV?

During the 1980's China governement requires companies that wanted to invest into China to form Joint Venture with local company selected by China's government. However things change since the inception of China into WTO in 2001. In the 80's multinational companies are obligated to choose local companies selected by the government, but these days MNC is more likely to choose its preferred local company.

The problem with JV with local companies, which has been documented in many books, including a case study between Pepsi and Sichuan Radio and TV Industrial Co. that led to a messy and protracted legal battle due to issues related to funds mismanagement and property rights.

One thing for sure is that there is nothing sure in China. Whether its best to Joint Venture or not make sure you do your homework by checking the local laws and regulations there and most of all take your time to understand the scenario and in JV case, your partner.

The general rule of thumb for many CEOs interviewed is if you can afford not to JV, then don't. JV presents a whole lot of business complications, from different cultural assimilation to different business objectives.

Small business should most usually venture in on their own. They need to understand the market scenario in the local, (Shanghai has culture and regulation not to mention language that is very dissimilar with Guangzhou for example).

Next: How to battle with competitors in China?

Opportunistic Sites that thrive

Check out visiblemeasures.com to find out the top internet videos being watched recently. You can also find the top 10 most-watched internet video of the year.

Boxofficemojo.com is another example of how internet create another business just by tapping into people's curiosity and to a certain extent interest.

Metacritic.com compile all reviews and ratings of books, dvd, video games, music, cinema movies, and tv series.

Based on siteanalytics.compete.com, the three websites churn out 1.2mill, 700k, and 400k unique visitors respectively. Now imagine the ad revenue they can earn by boasting such number.

These sort of casual knowledge were unheard of just a decade ago. Now it's flourishing. One innovation, like Youtube.com can lead to another money-making business.

Information is there not because people demand it. You create it, and if it's compelling people will want it.

Free Wifi Galore in America

Google sponsors all in-flights WIFI by Virgin America until Jan 15, 2010. The usual cost for the WIFI is USD13.

Yahoo! gives free WIFI in Timesquare for a whole year.

Microsoft gives free WIFI to airports and hotels, with condition that surfers make one search at Bing.

Such marketing expenditure draw two factors of leverage. The philanthropy factor(modern-age sceptical consumer appreciate free things coming from big corporations), and the public relations factors(media loves to cover this sort of news).