A. Situation Analysis
1. Market Summary
Market Trends
Our parents used to tell the story that during their younger
days, when strangers would know they are from Quezon, the
next thing they usually hear is, “You must be wealthy.” Those
were the days when the price of copra was at its peak. But
farming in Quezon has continued to decline in popularity
specially among the youth, leaving the vast agricultural
lands (sixty-three percent) of the province very unproductive.
This is the exact opposite of the market trend in the global
and national arena where e-commerce transaction continues
to grow. Quick research on the Philippine internet demographics
tell us that the current 4.5 million Filipino Internet Users
(FIUs) continue to rise by a million each year. Twenty-three
percent (23%) of these FIUs actually bought products and
services online with a total spending of around US$265 million
this 2002 (Philippine Internet Demographics, Janette Toral
of Digital Filipino). A big leap indeed from a mere US$1.6
million back in 1997.
Market Needs
During the conceptualization stage of this project, we
tried consulting the cooperatives and farming experts. These
consultations led us to the farmers themselves and made us
realize and understand better what are their needs. Field
personnel of the Provincial Agriculturist were already talking
of e-commerce. And we ask them, what prohibits the farmers
in doing e-commerce? They say, e-commerce is expensive. At
least they have a knowledge of e-commerce. They know that
e-commerce tremendously speeds up and simplifies transactions
while lowering transaction costs by dispensing with paper,
ink, transport, a large manpower complement and other overhead
costs. They also know that it finds customers anytime, anywhere
and give them access to critical product/service information
that may clinch a sale, and enables cost-effective one-on-one
selling to individual customers leading to product/service
customization and thus, greater customer satisfaction. But,
they just don’t know how to start.
Market Segmentation
Based on Market Needs we have mentioned above, it is clear
that the primary beneficiary or target market of the services
that QUESO offers are the farmers. This should not mislead
us when we come to that part of buidling up a website when
these farmers themselves becomes the sellers, hence a shift
of the primary target market. Again, we will come to that
with a new business proposal. Meantime, allow us to analyze
the market that QUESO is setting its focus.
• Demographic - The average income of this predominantly
farmers is Php 10,000 and more; most are members of cooperative,
between the ages of 30 and 45.
• Geographic - The 287,000 farmers from rural municipalities
of Quezon Province.
• Psychographic - They believe they can accumulate wealth
through farming, mostly they belong to working class and have
ambitious personality.
• Behavior - They would put their trust their government
and remain loyal to service providers that offer good value.
The relationship they develop with the government is critical
to a successful ongoing experience.
2. SWOT Analysis
The project is in line with the Provincial Governor’s
program in computerization.
Quezon is an agricultural province.
In line with the characteristics of new economics being observed in the province.
We have seen here problem situations to be considered and
protective measures to be used:
• Limited access and use of information technology.
Farmers have limited access to Internet and use of information
technology. The (countryside) telecommunication in the countryside
is not as developed in the cities. Improving infrastructures,
so that they will have fast, reliable Internet access.
• Volatility of prices. This necessitates industry
participants to be constantly in touch with the market, so
as to minimize prize risks and uncertainties. In coordination
with the Office of the Provincial Agriculturist, the Provincial
Information Management Office (PIMO) will train field personnel
on computer technology to gather information from farmers
and cooperatives and post them on-line a habit to make and
get from cooperatives and farmers and every harvest time
on even during planting season, an estimate of project.
• Credibility Risk. Since the site is open to everyone
to post and is free of charge, there is no way to verify
if the members posting are bogus. They can post fictitious
companies or may have legal companies but put misleading
prices. The members then must exercise caution in dealing
with other parties particularly for the first time. To address
this potential liability, the F4B.com site will post the
requisite notice of disclaimer.
• Hacking or Cracking. This refers to the unauthorized
access into or interference in a computer system/server or
information and communication system; or any access in. order
to corrupt, alter or steal or destroys using computer or
other similar information and communication devices without
the knowledge or consent of the owner computer or information
and communication system including introduction of computer
viruses and the like, resulting in the corruption; destruction,
alteration or theft or loss of electronic data message or
electronic document. This offense is punishable under the
E-commerce Law or Republic Act 8792 by a minimum fine of
one hundred thousand pesos (P100,000) and a maximum commensurate
to the damage incurred and a mandatory imprisonment of six
(6) months to three (3) years.
• Security of financial transaction. Unauthorized reproduction
dissemination distribution, communication, and making available
to the public or broadcasting protected materials, electronic
signature, etc/ though the use of telecommunication networks
but nor limited to the internet , in a manner that infringes
on the intellectual property rights shall be punished by
a maximum fine of one hundred thousand pesos (P100,000) and
a maximum commensurate to the damage incurred and a mandatory
imprisonment of six (6) to three years.
• Violation of consumer Act or Republic Act 7394 and
other relevant pertinent laws through transactions covered
by or using electronic data messages or electronic document
shall be penalized with the same as provided in these laws.
• Adoption of “paper to follow” practice
among some of persons in busses who use electronic forms
and documents up to now. This is based on the businessmen’s
fear of lack of legal protection or lack of information of
laws protecting e-commerce transactions.
• Law literacy among farmers, thus making them computer
literate is a challenge. Various industry associations shall
be encourage to support this project. Continuous education
and training by the PIMO and cooperative of farmer members
of cooperative will help ease the problem.
• Non-Competitive quality and insufficient supply of
products. The office of the Provincial agriculturist, a partner
in the project shall train farmers on improving production
and post harvest technology in order to meet the requirements
of e- commerce.
• Political Intervention – The project implemented,
may be adversely affected by political intervention, in the
term of Governor Wilfrido L. Enverga has been completed.
In order to avoid such situation to happen, the issuance
of an executive order relative to the implementation of e-commerce
in the province shall be requested and carried out during
the incumbency of the governor. This executive order would
ensure the continuity of this project in were to gain foothold
not only in the domestic but also in the global arena.
We must include with those weaknessess and threats the
(1) techo phobia from the farmers, (2) non-competitive quality
of their products, and (3) it is also possible that volume
of production would not meet the demand from buyers. Taking
a close examination of the good effect of the new e-commerce
however, we could easily translate these weaknesses as new
opportunities. Surely, we believe that our farmers will have
the opportunity to improve their knowledge and skills. With
the use of e-commerce, “clustering” (managed
asset reflation) could be easily managed and settle our problem
on slow production. Thirdly, assured of a new broad market,
farmers can now produce goods that can be sold not only to
their own “palengke” but the whole of the country
and of the world.
3. Competition
Except tiyangge.com, there is no website from Quezon province
that had made a positive influence on the internet market
yet. And modesty aside, tiyangge.com hardly make a wave.
Hardly then it qualifies to be a competitor, leading us into
the national scene where we can find the famous B2Bpricenow.com.
B2Bpricenow.com is actually a brainchild of Mr. Edgardo
Herbosa, who thought of establishing an e-marketplace for
farmers in June 2000. The first step Herbosa took in putting
up B2Bpricenow.com was to present his proposal to Unisys
Philippines four years ago, which at that time was looking
for projects to help the government alleviate poverty through
information technology. Herbosa and his partners were able
to convince Unisys to take care of the Web design, programing
and hosting of the site. In exchange, Unisys got to own 5%
of B2Bpricenow.com.
Then, for content, Herbosa began negotiations with Gerry
Geronimo, the producer of a popular agricultural TV and radio
show called “Ating Alamin.” To further strengthen
B2B-pricenow.com’s reach to farmers, Herbosa partnered
with the Land Bank of the Philippines. With funding support
from the bank and a training deal he negotiated with the
Polytechnic University of the Philippines, Herbosa has been
able to educate farmers on how to use the Internet and take
advantage of B2Bpricenow.com.
B2Bpricenow.com’s other partners include the Department
of Agriculture (DA), Department of Trade and Industry (DTI),
Philippine Rural Reconstruction Movement (PRRM), and the
Department of Science and Technology (DOST). The next phase
was enabling farmers, cooperatives and small entrepreneurs
to do online trading via their cell phones.
The biggest break came when B2Bpricenow.com won a grant
worth US$118,000 in a World Bank-sponsored contest. The “E-Commerce
for Farmers” initiative of B2Bpricenow.com was chosen
as one of the 30 winning entries from 2,400 proposals that
were submitted to the World Bank’s Development Marketplace
2001 competition held in Washington, D.C.
Herbosa’s next project is to set up B2B Business
Centers in partnership with farmer cooperatives in 1,500
municipalities nationwide. These business centers will act
as Internet cafes and financial service providers which will
allow cooperatives to make money by selling phones, prepaid
cards, or charging for Internet access.
As we can see, B2Bpricenow.com has come a long way in e-commerce
venture. It can surely provide our farmers, as it has done
during the past, a lot of e-commerce help and support. But
since this portal caters to the needs of all the farmers
of the whole Philippines, we can still see lots of personalized
services that it is not simply being equipped or designed
to provide. Indeed, some of the duties, functions and services
enumerated in our organizational plan is included in their
list; but we can notice, we are trying to add values that
would surely boost B2Bpricenow.com noble intention of helping
our farmers. Our customized portal, for example, intends
to provide Quezon farmers the support for them to “cluster” or
avail of “managed asset relation” among many
others.
4. Keys to Success
There are several factors that can contribute to the success
of an e-commerce project. Here are some:
• Before starting any e-commerce project, make sure
the participants fully understand what e-commerce is, how
it can benefit their business, how it is done and what are
the laws that apply to it;
• Define what we want to achieve from the project.
Try to strike a balance between ambitiousness and realism.
Keep it simple;
• Draw a roadmap and plot a work program for the project
complete with a timeline and required resources. Stick to
them but be flexible enough to make adjustments when needed
and if adjustments are best;
• Costs must be carefully determined and committed
to. Adequate funding and resources to complete and maintain
the project should be ensured;
• A capable project team that truly understands the
system from an organizational and technical perspective should
be put together. Bringing trading partners on board is a
complex project with many phases: education, equipping, software
usage training, product installation, internal systems development,
alignment/integration, parallel testing, and live implementation.
A capable implementation partner is critical to ensure competent
execution of the project;
• Be willing to streamline business processes if needed.
A good e-commerce project may uncover inefficiencies in their
current systems that have to be addressed to ensure the project’s
success;
5. Critical Issues
• This project cannot proceed without the approval
of the Governor.
• Cooperation and willingness of the farmers are considered
very important issue. Techno phobia is understable at the beginning,
but the antidote is at hand.
B. Marketing Strategy
1. Marketing Objectives
By the end of 12th month of the project operation we aim
to have registered or trained at least 300 farmer-sellers
and actually does e-commerce in the internet. We intend to
project the image that www.quezon.gov.ph is a part of every
agricultural business in Quezon.
2. Target Market
As exlained many times in this plan, we are targetting
on the farmers as our primary market. But on the lower bend
that bell tells us are small and medium enterprises (SMEs),
all from Quezon. Once this primary target market start to
respond, then we will “vicariously” consider
their own primary target as also our own. Briefly, we have
as our primary target market: the Quezon “sellers” and
consequently their own PTM: the “buyers” (literally).
3. Positioning
For farmers who needs full e-commerce services, QUESO positions
itself to be the prime, leading and complete e-commerce service
provider in the whole province of Quezon.
4. Marketing Mix
Although we intend to provide most of our services free
of charge particularly the posting of products and requests
on the bulletin board, some, however need payments. Training
fees worth P250 which also covers training kit snacks for
a three-day seminar. Web design would cost P500 per page;
DNS, P800 every year and hosting, P1,000 a month for every
20mb. Price monitoring by using cellphone or SMS (P2.50 per
text message) will be charged per inquiry. We also intend
to charge one percent (1%) of every online transactions made
via affiliated bank.
For us to be able to deliver our products and services
to our primary target market, we will start with door-to-door
information dissemination and campaign using appropriate
means including roadshows and publications of leaflets/information
materials which should be distributed to the members of farmers
cooperatives.
Once farmers-participants’ products are up on the
internet, the QUESO should make every effort to encourage
visits to the portal/website; encourage trading by creating
a list or possibly a data base of all potential buyers and
collect at least a hundred names , contact information, addresses
of highly interested costumers on its first year of operation.
Put the website address prominently on all marketing materials
(calling cards, letterheads/envelopes, brochures, press releases,
streamers, signages, billboards, giveaways). Transactions,
orders, inquiries that occur between sellers and buyers must
be constantly monitored to help the officers recommend adjustments
and in making policies. We may also do cooperative advertising
with related websites. That means advertising our site on
others’ website and they advertise theirs on ours.
We will update our website weekly so information remains
fresh. We will also monitor orders, inquiries and feedback
as often as possible.
QUESO services will be accesible by putting up an space
at the Office of the Governor. Information regarding these
services will also be brought to our primary target market
thru the cooperatives, MPDOs, direct communications (Circulars,
Mails, etc.), newsletter, Web site. |