It came as
a shock to everyone who spends a lot of their time enjoying the internet may it
be personal, for online shopping or even utilizing the internet for selling
stuff online to learn that Multiply’s Philippine Online E-commerce platform (Multiply
Marketplace) is now shutting down.
I’m an MBA
Student who has been studying online businesses and the Internet usage in the
Philippines for years now and might be planning to publish a book in the near
future. My thesis studies also leads me to the correct directions to conclude what I’m about to say. But it’s not really up to me to declare what the top
management of Multiply are really thinking to make them decide to pull out of
the Philippine’s Market.
#1 Problem –
Monetary
In mid
2010, Multiply warned the public to back up their files as they are gearing up
towards making the social media site into becoming an E-commerce platform that
will let people post items they want or can sell to the public. All inactive
accounts where wiped out and Multiply slightly changed with the emphasis of it’s
market place. Soon the market embraced the platform as SME’s or just any bloke can
just post in whatever they can sell online for free. Multiply later on improved
their services tie-ing up with Xend and offering various localized convenient online payment
support systems. But the Philippines wasn’t really mature enough to put in money
online.
Sales
Generated:
2011 : P10,162,684 (12%) Market Share
2012 : P3,061,711 (.6%) Market Share
Net Income
(Loss) ---- 2011 --- (P77,358,479)
Net Income
(Loss) ---- 2012 --- (P36,967,362)
Source: SEC I-View (Public Document) https://ireport.sec.gov.ph/iview/index.html
As you can
see; 2011 was the year Multiply Marketplace Started operating in the
Philippines. After expenses – it incurred costs more than what they have
earned. The rate to "Cost per earnings" further worsen the next year. The 2012
data showed above only shows the first quarter of 2012 which looks really bad,
the cost was already too high but the income was really low. The market share
also worsened. Even if you quadruple the market share’s percentage based on my
research of (Online Classified Ads Sites in the Philippines) the industry is
just really pounding on the company milking money off of its pockets as if a
dying entity in the industry.
If you would look at Multiply PH's books submitted as public documents in the SEC, their biggest cash outs in 2011 where to salaries of P35M, Travel Costs P1.5+M, and Selling and Marketing Expenses P26M. The better question to ask their PH top level executives are... like in 2011, where did all these money go to? 35M!? for salaries? really!? and where where all the marketing and advertisements spent on!? they really have to at least answer to a lot of people, maybe even please subject to audit checks. don't just leave us hanging with a "we don't need to explain" attitude as this is really a demoralizing event for the PH's online market.
#2 Questionable
Operations
From the
beginning Multiply can only be reached thru it’s website, ask anyone of it’s
top merchants as to whom among them have already stepped in to Multiply’s
Philippine office, you might be shocked to find out how few or zero is the
number. Support only comes thru emailing them and calling them would only get
you thru a receptionist-like personnel.
For someone like me who is
working for a digital marketing related company, they could have been more accommodating
and friendly to us as we could have made
big accounts and poured in hundreds & thousands of money in to their pockets as
Multiply is the really preferred site of young professional women for clothes
and accessories.
#3 Presence
in Advertising – No effort
I
understand that Multiply is a very well known brand, but the company was not
aggressive enough to generate sales, rather; their position was more of
waiting and hoping for advertisers to pour
in money by just being happy with the e-commerce platform. Unlike
dealing with Sulit.com – I can set up a meeting with them tomorrow, in their
office (so now they built trust), or in our office (now we get that they're serious)
but Multiply is just really hoping that we only use their online platform to
advertise on their site, a little help and encouragement from their PH staff could had been better
than no effort at all.
#4 The
Maturity of the People is not there yet
In the
Philippines, buying online is still hard. Over the years at least 35%(biggest) of online based purchasing transactions
are still done thru meet-ups. Since meet ups as it is are more convenient (technology
wise), and secure (product can be tested). I mean you can back out if you meet
up and don’t like the seller’s item as it may have defects that you have not
anticipated or was not mentioned on the post which is better rather than being sorry or stuck in a return policy limbo.
Payment
gateways or payment methods are also expensive for sellers to maintain, and
also scary for users to use as they have charges and what so ever mind-set
warnings of security issues. Not to mention how sure are you that return policies
are 100% honored online by all the online sellers around the world.
Again, this
is not the official reasons of Multiply Marketplace. This is just my analysis
from years of research and studying the Internet – which gives me a high chance
of accuracy as for what are their actual
reasons for Closing down in the Philippines.
Multiply
will be offline from May6, and will close its Philippine office by May 30 2013.
