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Pakistani 3 Marketing Case Salam2013
Pakistani 3 Marketing Case Salam2013
dx.doi.org/10.1108/EEMCS-06-2013-0103
(2013),"Mumbai Indians: a case on social media marketing", Emerald Emerging Markets Case Studies, Vol. 3 Iss 5 pp. 1-21
http://dx.doi.org/10.1108/EEMCS-02-2013-0014
(2013),"Architecting MexGro: introducing online experience for shopping ethnic products", Emerald Emerging Markets Case
Studies, Vol. 3 Iss 5 pp. 1-11 http://dx.doi.org/10.1108/EEMCS-10-2013-0196
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Muhammad Talha Salam It was end of the last meeting for Wednesday, 20 June 2012 as per Aamir Nouman’s planner.
is an Assistant Professor The accounts manager had just left and had left Aamir frustrated. In this meeting, after
based at the FAST School of completing a review of the consolidated financial information[1] for FY2011-2012, it was
Management, National confirmed that Web Portals Division at Mech Technologies had not even been breaking even
University of Computer & for almost a year. This downfall was initiated by the fateful e-mail Aamir received in July 2011.
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Emerging Sciences, The portals operated by the company’s Web Portals Division were found to be in violation of
Lahore, Pakistan. Google’s Adsense terms and conditions. The Adsense team sent an e-mail stating that Mech
Technologies’ advertising account was suspended henceforth due to these violations.
Which particular terms and conditions were violated and how? The e-mail did not say much.
This decision was not challengeable nor was the Adsense team approachable and such
communications were largely one-way as per SOPs of Google. Adsense was an online ad
network through which hundreds of thousands of web site publishers around the world (like
Mech Technologies) monetized advertising spaces and earned automated revenues. This
revenue stream, vital to the sustainability of Web Portals Division, stood closed as of July
2011 onwards and other options were proving to be quite challenging, to say the least. The
mainstay of these other options was a small sales team hired in August 2011 which after
almost a year in operation was not even able to cover its own salary and other expenses. The
Web Portals Division Aamir had successfully managed so far on Adsense revenues seemed
to be in a quandary. Resources and a formidable plan of action for the next few months were
needed to keep this division afloat.
DOI 10.1108/EEMCS-06-2013-0096 VOL. 3 NO. 8 2013, pp. 1-14, Q Emerald Group Publishing Limited, ISSN 2045-0621 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 1
For instance, if a client wanted a web site for a hotel, the site would contain all the information
as well as promotional material for that hotel. In addition, it was inevitable in the highly
connected twenty-first century market that it also had built-in applications to manage
customer end operations like online reservations and payment collection, etc. These
applications would then be integrated into the company’s mainstream information system
thus providing a comprehensive online portal. Such sophisticated and well-functioning web
sites were commonly known as web portals.
Like its peer technology companies from this part of the world, Mech Technologies did not
focus on local clients. The local market was in the nascent phase for web services and it was
difficult to find many equally well-paying clients as compared to advanced markets.
To further improve their services and offer a quick turnaround time to their client, Mech
Technologies developed ubiquitous applications and web portal templates which could be later
integrated into any client’s customized project. These applications and templates remained the
property of Mech Technologies and the company was at liberty to use them in any other project.
were concerned with was to come up with a strategy to earn sustainable revenues from
these portals. Web portals had the potential to earn through advertising and in some areas
paid services were an additional revenue stream. In the initial phase, Mech Technologies
developed and launched three portals from March to June 2009. These included:
1. a portal for jobs and employment;
2. a portal dedicated to cars, latest information, listing, etc.; and
3. a portal dedicated to motorbikes, latest information, listing, etc.
In addition to developing these portals, resources were required to manage these portals
and their content. In January 2010, two executives were hired and trained to manage these
portals. Managing these portals typically included activities like posting related content,
providing services to registered users regarding issues they faced in handling their
accounts. They were also responsible for reviewing and approving content posted by users,
typically classified listings.
Few months after the Web Portals Division took off, Irfan Akram, one of the Co-founders,
decided to focus solely on outsourcing projects by Mech Technologies while Web Portals
Division became Aamir’s responsibility. They continued to operate from the same office but
delineated their responsibilities within Mech Technologies[3]. Formally, Aamir Nouman
became the company’s CEO and Irfan Akram assumed the responsibility of Managing
Director. Web portals were developed and managed using resources of Mech Technologies.
As for the IT infrastructure used by Web Portals Division for all the portals, the costs
remained minimal and were not considered separately.
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PAGE 2 EMERALD EMERGING MARKETS CASE STUDIES VOL. 3 NO. 8 2013
22 situation. More traffic was needed before employers would be ready to pay for the
services. But traffic was a result of more job postings, which were possible by more
employers! Earning from advertising on these portals was effective only with higher traffic
because of CPM and CPC models[4] in vogue in the industry. Banner ads could be sold
through personal selling or advertising or be offered to ad networks like Google’s Adsense.
was word of mouth. For any portal of this sort, it was inevitable that at some stage, critical
mass was achieved and word of mouth generated additional traffic.
On the revenue side, after an initial slumber of around six months, reasonable traffic started
coming in. This was the time when advertising using the automated stream of Adsense was
deployed on the site. Increasing traffic meant increased revenues which were augmented
by revenues from paid services. For the site layout of Bayrozgar.com, see Exhibit 3.
Promotion for both the portals was carried mainly through online advertising and word of
mouth. For the site layout of ApniGari.com and ApniBike.com, see Exhibit 4.
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VOL. 3 NO. 8 2013 EMERALD EMERGING MARKETS CASE STUDIES PAGE 3
and the network all had a winning stake. The advertiser was saved the hassle of contacting
and auditing different web sites. The publisher was able to monetize his web site(s) or
portal(s) without investing in promotion effort. The network (Adsense) earned automated
revenues in exchange for such intermediation.
For many web site publishers like Mech Technologies, Adsense meant an automatic revenue
stream from their web sites. All they were required to do was to provide banner spaces on
their web sites to Adsense which would then serve the ad on those. This highly productive,
no-hassle revenue stream came to a grinding halt in July 2011. Citing the debacle, Aamir
Nouman said[5]:
For us, losing Adsense was really unfortunate. But what we soon learnt that many other publishers
in Pakistan had also lost their Adsense accounts around the same time. According to
ProPakistani[6], around 70% of the accounts were closed on complaints of malpractices. Few of
clean ones like ours were also rounded up. It was like a crackdown by Google and Google was
not going to listen to anyone. Adsense earning became history. We had to look for alternatives.
Other networks had much less revenue. Quality of ads served by those networks was also much
inferior to that of Adsense as it had a proper quality control framework in place.
There were other ad networks, but their revenues were fractional as compared to Adsense
and were not even sustainable. Paid services were a better alternative but were much more
convoluted than what the company was used to in the case of Adsense’s automated revenue
stream.
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Paid services
There were two key paid services: premium listings (for all portals) and recruitment services
(only for the job portal).
Paid listings in addition to banner advertising offered by the site were positioned as
‘‘premium’’ from the standard offering. Thus, otherwise free, a paid listing would become a
premium. Premium listings were given a prominent place on the front page of the portal.
Increased visibility and branding mileage leading to increased response justified the cost for
the advertisers.
Exclusively for the job portal, another option was online recruitment services which included
access to the complete database of CVs, personalized services as well as dedicated
company pages within the portal. Accessing the complete database made sense to
employers and recruitment firms having higher recruitment frequency. See Exhibit 5 for
detailed pricing of paid services by Bayrozgar.com and selected job portals.
The challenge in the paid services was selling these services to clients. It required a
dedicated personal selling team. Some initial planning was done at the inception of these
portals for this personal selling. Still, paid services never took off seriously until Adsense
earning ended. To undertake personal selling, two more marketing executives were hired in
August 2011. After a couple of weeks of training and orientation, they were given the task of
aggressively contacting all the existing clients and registered users and offering them
upgrading to paid services.
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PAGE 4 EMERALD EMERGING MARKETS CASE STUDIES VOL. 3 NO. 8 2013
In this market, there were several web portals of local and international origin having good
traffic from Pakistan. While leading global portals, search engines and social networks
dominated this market as well, some local web portals among the local origin web sites and
portals, newspaper web sites led overwhelmingly in terms of traffic[10].
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VOL. 3 NO. 8 2013 EMERALD EMERGING MARKETS CASE STUDIES PAGE 5
‘‘followers’’ of that company for free on Facebook and LinkedIn[12]. More followers meant
more exposure. So it was obvious that gaining more followers had become a key
objective of many companies and brands.
B Other players included indirect competitors like newspapers and recruitment firms.
Newspaper advertising was historically an expensive option but boasted a wider
audience than the internet. However, this was changing with ever-increasing penetration.
Recruitment firms provided much more personalized services than any other option. For
these tailored services, their prices were quite varied and at times prohibitively
expensive, particularly for the small employers.
For more comparative profiles of different job portals, see Exhibit 6.
On the client’s end, although many companies had professional HR departments, they
remained devoid of serious attention and budgets. Although companies needed to hire more
people in the thriving economy, they wanted to cut corners and go for the lowest-cost
options (ideally free in most of the cases). As per one of the marketing executives of
Bayrozgar.com[5]:
Clients came to our site initially only because we were free. They frowned upon any priced
upgrade that was communicated to them and were simply not interested. In most of the cases,
they shared that it was a limitation in their setup that recruitment was expected to be a low-cost, if
not free activity.
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Challenges ahead
After a gloomy meeting on Wednesday evening, Aamir took some time out and spoke
informally to the Web Portals team on Thursday morning. He shared with them key highlights
of the review and apprised them that the division was not a sustainable business if things
continued in the same way. The team members shared their concerns that it was getting
harder to sell in the face of competitors offering free services. Further, their penetration was
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PAGE 6 EMERALD EMERGING MARKETS CASE STUDIES VOL. 3 NO. 8 2013
limited because of using telemarketing as the sole medium of communication. They were
expected to bring in revenues in the face of competition offering low-cost, free services to
employers. The high priced competitors were well-funded and had a strong sales
infrastructure in place in all regions.
Aamir was somewhat aware of these concerns and thought that he would chalk out a clear
strategy to tackle competitors as well as bring the Web Portals Division back into profit. He
was eager to invest in the sales team but a sales team selling lower priced or at times free
offerings did not make sense. Personal selling of online advertising was an option but was
very time-consuming. The advertising industry in the country was still warming up to online
advertising which continued to be not more than 5 per cent of the country’s total ad spend of
around PKR 30 billion. It was widely believed that during these evolving years, online
advertising would continue to experience nothing less than double-digit growth rates[13].
Aamir had observed and learned about practices of competitors from informal sources. He
was keen on learning from their successes as well as mistakes. The Web Portals Division
was losing money with every passing day, week and month. An aggressive marketing
strategy to engage clients was all that Aamir was looking for. Nothing else would be as cool
for the rest of the summers!
Notes
1. Selected financial information is given in Exhibit 1.
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2. Lahore was Pakistan’s second largest city and several internet startups were based in this city.
3. For complete organization of Web Portals Division and Mech Technologies, see Exhibit 2.
4. CPM – cost per impression model implies that advertisers paid only for the number of impressions
served on a particular web site. CPC – cost per click implied that advertisers paid only for clicks
achieved on their ads.
5. In an interview with the author.
6. A leading Pakistani blog on technology related matters which covered this issue extensively in
different posts during 2011. URL: www.propakistani.com
7. Source: internet world stats; ISPAK – an internet trade body in Pakistan estimated around 25 million.
8. Source: CIA world Factbook; defined as population 15 years and above – which could read and
write.
9. WEF a Swiss-based non-profit is a global think tank which produced GITR on annual basis.
10. Source: Alexa.com – web analytics company (www.alexa.com).
Keywords: 11. Information developed from respective web sites’ ‘‘about us’’ sections as well as interviews with
Online advertising, sales team at Mech Technologies.
Marketing strategy,
Promotion, 12. Facebook and LinkedIn, worlds’ largest personal and professional networks, respectively, were
Developing markets, among most trafficked portals in Pakistan with traffic much higher than any of local portals.
Internet business, 13. Well established and authentic advertising spend figures and growth rate estimates were not
Personal selling available. These facts and figures were estimated by a marketing research firm and industry experts.
References
Alexa – The Web Information Company (2013), ‘‘Top sites in Pakistan’’, available at: www.alexa.com/
topsites/countries/PK (accessed 4 April 2013).
Mech Technologies (2012), About Us, available at: http://mechtechnologies.com/aboutus.php
(accessed 3 April 2013).
Nouman, A. (2013), Personal Interview with CEO (in person) 2 April 2013.
WEF Global IT Report (2012), The Global Information Technology Report 2012 Data Platform, available
at: www.weforum.org/issues/global-information-technology/gitr-2012-data-platform (accessed 4 April
2013).
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PAGE 8 EMERALD EMERGING MARKETS CASE STUDIES VOL. 3 NO. 8 2013
Table EI
Average monthly figures till Average monthly figures after
Sr. July 2011 before Adsense July 2011 after Adsense
No. Items contract was cancelled contract was cancelled Notes
A12 Paid services 17,500 74,600 Mainly recruitment services as well as premium listings
(non-banner advertising)
A2 ApniGari.com and ApniBike.com revenues 228,420 20,850 A21 þ A22
A21 Advertising 228,420 5,850 After Adsense, banner ads sales are mentioned
A22 Paid services – 15,000 Mainly premium listings (non-banner advertising)
B Expenses 58,090 121,720 B1 þ B2 þ B3
B1 Sales expenses 8,210 69,540 Mainly salaries and operational expenses of sales team
B2 Promotional expenses 10,500 9,500 Costs for promoting the sites
B2 Administrative and other expenses 39,380 42,680 Direct costs for site administration and management
C Net income 400,470 (19,570) A 2 B (net income before tax)
Notes: All figures in PKR; as of 2011-2012, 1 USD was equal to 90 PKR (approximate average)
Source: Company records
Exhibit 2. Organization of Mech Technologies
Figure E1
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Notes: Team information for Web Development Division is for technical team only; information
for Web Portals Division is for sales and site management team (non-technical staff);
Web Development Division was headed by Irfan Akram (company's Managing Director);
Web Portals Division was headed by Aamir Nouman (company's CEO) – both
were founding partners; company had a fairly lateral reporting structure; almost all
employees reported to respective
Source: Company records; corresponding industry averages for the respective teams were
not formally available; this information was developed from informal discussions with CEO
and other team members
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VOL. 3 NO. 8 2013 EMERALD EMERGING MARKETS CASE STUDIES PAGE 9
Exhibit 3. Standard layout of Bayrozgar.com
Figure E2
Banner Advertising
Initially Adsense
advertising was
displayed here.
Later, these were
sold by sales team to
different advertisers
through personal
selling
Paid listings
Guaranteed position
on front page meant
increased visibility
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PAGE 10 EMERALD EMERGING MARKETS CASE STUDIES VOL. 3 NO. 8 2013
Exhibit 4. Standard layout of ApniGari.com
Figure E3
Banner Advertising
Initially Adsense
advertising was
displayed here.
Later, these were
sold by sales team
to different
advertisers through
personal selling
Premium ad listings
Paid listings
Guaranteed position
on front page meant
increased visibility
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Standard ad listings
Free listings
Did not stay on the
front page
Table EII
Prices for job portal recruitment services
Sr No. Items Bayrozgar.com Rozee.pk Mustakbil.com
Notes: As of June 2012, JobsVilli.com was offering all services free of cost; all figures in PKR; as of
2011-2012, 1 USD was equal to 90 PKR (approximate average)
Source: Company records (Bayrozgar.com); information on portal (Rozee.pk and Mustakbil.com)
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VOL. 3 NO. 8 2013 EMERALD EMERGING MARKETS CASE STUDIES PAGE 11
Table EIII
Prices for job portal recruitment services
Sr No. Items ApniGari.com PakWheels.com Garee.pk
Notes: All figures in PKR; as of 2011-2012, 1 USD was equal to 90 PKR (approximate average)
Source: Company records (ApniGari.com); information on portal (PakWheels.com and Garee.pk)
Table EIV
Prices for online advertising (banner spaces)
Sr No. Parameter Bayrozgar.com ApniGari.com ApniBike.com
Notes: All figures are numerical counts; CPM figures in PKR; this information was available only for
Mech Technologies portals as other companies did not share this information publicly; one key reason
was customization extended offering to every advertiser
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PAGE 12 EMERALD EMERGING MARKETS CASE STUDIES VOL. 3 NO. 8 2013
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Table EV
Parameter Bayrozgar.com Rozee.pk Mustakbil.com Brightspyre.com JobsVilli.com
(as of June 2012) Selling ad spaces Selling ad spaces Selling ad spaces Selling ad spaces Selling ad spaces
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Adsense Adsense Adsense
Key promotional Word of mouth Word of mouth Word of mouth Word of mouth Word of mouth
strategies for Job fairs Online advertising Online advertising
jobseekers
Promotional strategy Personal selling Personal selling (telemarketing, Personal selling (telemarketing, Personal selling (telemarketing, Personal selling
for employers (telemarketing) extensive field sales) limited field sales) limited field sales). Participation (telemarketing)
Participation in industry events Participation in industry events in industry events
Notes: aThese figures were approximately rounded off as per publicly shared information by respective portal; authentication was not possible; bNA implies figures/information not
available – an unappealing low figure could be construed; cthis ranking is based on Alexa’s position of these sites in Pakistan; rank compares to each other only; dbased on limited
information gathered from sales team and CEO Mech Technologies
Source: Interviews from Mech Technologies sales team; information on portals (for rest of the portals); Alexa.com for traffic ranking
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VOL. 3 NO. 8 2013 EMERALD EMERGING MARKETS CASE STUDIES PAGE 13
Exhibit 7. Comparison of different classified listing portals
Table EVI
Parameter ApniGari.com PakWheels.com Garee.pk Olx.com.pk
Notes: aThis ranking is based on Alexa’s position of these sites in Pakistan; rank compares to each other only; bbased on limited
information gathered from sales team and CEO Mech Technologies
Source: Interviews from Mech Technologies sales team; information on portals (for rest of the portals); Alexa.com for traffic ranking
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