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Look for alternative revenue, dotcoms told

Channel News Asia, April 30, 2001

Dotcom companies should seek other additional revenue generating services to complement the services provided on their websites, the chief executive officer of a Malaysian web services provider told a business IT gathering over the weekend.

Speaking at the Young Entrepreneurs'Association of Malaysia (PUMM) in Kuala Lumpur, Ms Fione Tan, CEO and president of Sdn Bhd said many dotcom had failed because they were unable to grasp the fundamentals of Internet marketing.

"Based on ... case studies, companies have high overhead costs, overspend in their advertising and promotion expenses, overspend on their web development and technology and over-relied on advertisements for their income," explained Ms Tan.

Other factors she gave included poor customer support and the lack of online corporate information.

Ms Tan said advertisements on websites form only a small proportion of the overall income of dotcom companies. Her company, for instance, is an e-business portal and consultant, has launched a beauty / fashion portal and it foresees a large proportion of income coming from offline events such as grooming classes.

Ms Tan also cited steep competition from better-established offline operators with the financial clout as another key factor for dotcoms. She gave the example of Hong Kong e-commerce portal, which encountered difficulties when its competitors waged a price war with it and pressurized suppliers to end their deals with AdMart.

Despite the failure of so many dotcoms, Ms Tan said there are still opportunities for companies to do their business online as long as they plan their operations strategically.

Besides providing a new channel for advertising, sales and marketing, the lnternet provided a ready database to follow up on customer orders and as a generator of leads for selling new products.

"Look for alternative revenue, dotcom told - Channel News Asia"

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