Transcription of Finance News Network Interview with 99 Wuxian Limited (ASX:NNW) Chairman, Ross BensonLelde Smits: 99 Wuxian Limited
(ASX:NNW) is an online mobile marketplace advancing its spread in China’s lucrative mobile technology. The marketplace offers a variety of physical and virtual goods through a mobile banking platform on a smart phone or tablet. The Company has more than 36 million registered users and is working with its business partners to accelerate registration. I’m Lelde Smits and joining me at ASX Investor Series in Sydney is the Company’s Chairman, Ross Benson. Ross welcome.
Ross Benson: Thank you Lelde.
Lelde Smits: It’s been a busy period for the Company with a series of key announcements that have been made. What have been some of the most exciting highlights for you?
Ross Benson: I think in the last quarter, we’ve seen the September quarterly numbers come out which were very encouraging. We had RMB1.8 billion of transaction volume, which is a 40 per cent increase on the September quarter for 2013. So we’re delighted with that. We’ve seen our registered users grow to over 36 million and that’s again, growing very encouragingly. We also made acquisitions around the joint venture with Tapit Media Pty Limited, which has really got to do with the deployment of NFC (near field communication) technology in China, and an opportunity for us to face the market B to C.
We had an announcement regarding our new channel partners and this is very exciting for the business, because it opens up in the financial sector insurance companies. And this is not only potentially more customers to face, but a value add for our existing business partners. And finally, we announced a deal with UnionPay.
Lelde Smits: If we can look closer at your announcement of the major new business channel to market, who is involved and what are you targeting?
Ross Benson: Well the exciting thing about this is that we’ve really now targeted the insurance companies. I mean our business is B to B to C. So any large financial services business in China is an opportunity for us to provide a value added service, to their customer base. And so the engagement with the banks is really a B to B engagement, and they will provide value added services to their policy holders. And that’s a very exciting thing for us, because it increases engagement from the consumer and obviously a lot of those consumers, are existing customers of our business partners.
Lelde Smits: Just for those who aren’t familiar, could you recap B to B and B to B to C?
Ross Benson: So our model is B to B to C. It basically means when we face the market, we face it through business partners. So we sit within that
business partner’s mobile ap. B to C and the best example of that is your Alibabas and Tenzin, face the market directly via their various marketplaces and platforms. The main benefit of B to B to C is that in China, one of the biggest obstacles or barriers to consumer acceptance of mobile, mobile commerce, mobile payments, is fear of security and payment.
So we get the value of facing that customer through their trusted payment partner, and it also helps a lot as far as the efficiency of acquiring customers. So our cost of acquisition, because of this model is around about 80 per cent less than our B to C counterparties.
Lelde Smits: On an industry level, which sectors or demographics do you expect will drive future growth?
Ross Benson: In China the interesting thing about demographics is this is a change of behaviour. So we’re seeing demographics right from 20 year old mobile users, right up to 65/70 year old mobile users, become engaged with mobile commerce. The focus of our business is really the demographic of 25 to 40 years old, and they tend to be new Chinese consumers. Because of that, we have a business that is focused on the sale of virtual and intangible products. So around about 80 per cent of our total GTV (gross transactional value) is things like prepaid phone charges, game downloads, ticketing. So this is really an area we’re focused on developing further, because we’ve created quite a niche in that market.
Lelde Smits: Finally Ross, what do you anticipate will be the Company’s next major milestones?
Ross Benson: The business is growing very quickly, so there’re a number of milestones we’re looking to achieve. But I think from a registered user acquisition, we hope to hit the 50 million registered users in the very short term. We are actively engaged with developing and really working closely with our existing business partners, to convert more of the 320 million mobile banking customers, into registered users. And finally, obviously the market will be aware that we announced an RFP (request for proposal) process. And so we’re looking forward to announcing in the short term, the outcome of that RFP process.
Lelde Smits: Ross Benson, thank you for the update from 99 Wuxian.
Ross Benson: My pleasure Lelde.
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