2. Intro to our bidding site idea
Web services are in big demand among young people(18-40
in our country, especially since the government lowered
Internet access fees in this year.
So, we thought about setting up a website that could interest
local young people.
After some brainstorming and research,
we came with the idea of a reverse bidding site for
goods and services(like e-bay but different)that will focus on
technological products like Ipads and mobile phones.
Users will be able to put their own goods and services
for bidding on the site.
3. Bidding site idea(contd)
The idea of a bidding site is not a new one.
However, in our country, it is rare that people use
bidding websites because only 30% of households are
connected to the Internet and most people do not trust
on-line transaction methods.
Nevertheless, new government policies are providing
opportunities to open such a bidding website.
Indicators in the local ICT sector show that there will
be an economic boom in the web service market in the
next 2 years.
4. Opportunities
Changing government policies are providing
opportunities to open a web business.
– The access fee for broadband Internet is dropping
and free computer centers across the country provide
free net access.
However, most of our compatriots still doubt the
security of on-line transactions.
We will provide an off-line and mobile payment
solutions(in addition to on-line payment) to give an
alternative payment solution to clients who doubt on-
line transaction.
5. Opportunities
There are currently no local bidding websites.
So, if we go through with our project, we will have a
first mover advantage in the local market.
Another opportunity comes from the fact that 2 out of
3 people(aged 18-40, both men and women) like to bet
on lotteries in our country(to try to win something for
little money).
So, a bidding site that can provide people a way to win
things for little money has big potential.
6. Estimating market size
The IT/BPO global sourcing market size is currently
estimated between USD 89bn and 93bn with IT and
BPO market shares averaging 40 and 60 percent
respectively.
The contribution of the IT/BPO sector to our country's
economy is expected to grow to some 8% by 2015 with
direct employment in the sector amounting to 25,000.
7. Estimating market size (cont'd)
The local ICT market is worth about 600 Billion US$ !
The local web services market is relatively small
though. It's difficult to size up this market unless
Facebook is used as an indicator for potential
customers.
There are more than 230,000 people on Facebook who
fit our customer profile - based on age(18-40) and web
use.
8. Estimating market size (cont'd)
The number of potential local clients for our bidding site
is about 230,000, based on our research using Facebook.
How many of those prospects will buy our product ?
1 out of 10(according to a survey involving 1000
Facebook users)
This narrows down our customer base to approximately
23,000.
9. Estimating market size (cont'd)
The market for the bidding site will consist of about
23,000 local prospects.
Now, we need to convert this number in terms of
money.
Our bidding site will have a minimum unit income of
$2.5/month.
Using this average income, we can calculate the
average local market size – which is 23,000 * 2.5 =
$57,500/month
10. In depth market research on
target customers
We began this research by asking a few questions to
potential customers(we randomly contacted 100
Facebook users from our target customer base and had a
Skype chat with them);
Do customers have the problem that we think they do ?
60% seemed to have the 'trust problem' with using international
bidding websites. (They cannot physically contact the customer
support team, on-line payment is too risky and so on)
10% had no problem in using existing international bidding sites.
30% were not sure about using bidding sites.
11. In depth market research on
target customers
The next question we asked the potential clients is:
Can they solve the 'trust problem' they have with bidding sites,
how are they doing that and how much do they pay for that
solution ?
10 said they had no 'trust problem' with international bidding
sites, they use Ebay to do their bidding. The price they pay
vary between $0.10 to $200.
25 said they only bid on products with low prices(less than
30$) to avoid risking too much money.
The rest do not use any bidding sites.
12. In depth market research on
target customers
Are the potential customers interested in our solution
and are they willing to pay for it ?
70% said they are interested if other payment methods
are available instead of just on-line payment.
10% said they are not sure.
20% said they are not interested
13. Conclusion
We have gathered enough data from surveys to
know if the bidding site is worth it.
The target customers show some interest in our
service and the local market size seems big enough
to sustain a new start-up like ours.
We have decided to go ahead with the project !
All of us, in the team, hope that it is the right
decision.
