Platinum Capital (PMC – ASX) release monthly and quarterly market reports via their website. In their March 2017 quarter report Chief Investment Officer, Andrew Clifford, reflected on his trip to China and talks about some interesting observations he made. Two parts which really stood out to me are Andrews observation on the advantages of digital advertising & the growth of Alipay, a Chinese online payments system.
The Rise of Local Brands
“In the past, these start-ups had been kept out of the market because of the sheer cost of large-scale advertising on TV and in print. The advent of digital advertising has opened a door for these companies and, what is more, it enables them to target very specific groups..” – Andrew Clifford, CIO, Platinum Capital.
Here Andrew talks about his observation of the effect digital advertising is having on helping smaller, local brands compete with larger, more well-known brands. Given the easy and low-cost access to digital advertising mediums, as well as being able to more directly target your intended market, digital marketing is a form of advertising all small businesses should consider.
The Ubiquity of Alipay
“Alipay is an electronic wallet or online payment system that grew out of Alibaba’s e-commerce platform in much the same way that PayPal had developed hand in hand with eBay. In China, however, Alipay has evolved to be much more than a way of settling online payments and, in the absence of a deep network of credit card and EFTPOS terminals, has become the way of settling essentially any transaction.” – Andrew Clifford, CIO, Platinum Capital.
In this part, Andrew talks about Alipay. Alipay is a Chinese online payments system which grew out of Alibaba, much like PayPal grew from eBay.
However Alipay goes a few steps further than being purely an online payments system, they are using the financial information they collect on their users to provide short-term loans, credit rating data & also insurance.
You can read the full report here.