It is said that almost nine out of 10 entrepreneurs fail in their journeys. While you see every young graduate now clamouring to find the one brilliant idea that will turn them into the next Steve Jobs or Richard Branson, the harsh reality is, being a entrepreneur requires guts, gusto, and most of all, heart.
While making a mistake is part and parcel of the job, it still doesn’t make it any easier. Speaking to audience members during a chat at A+M’s recent Digital Marketing Asia conference in Malaysia, Joel Neoh, founder of Fave, said if you fear making mistakes as an entrepreneur, there is no room for improvement.
“As an entrepreneur, you make a lot of mistakes. When you start off something new, there is almost always nothing to lose, almost. Most of the time you have a vision of a product and you listen to consumers and innovate and just iterate it as you go on,” he said.
But at the end of the day, he said, listening to customers was a must.
A+M: Do you feel more pressure now that you are known to be successful?
No, not really. The way that we build our companies we try to have it flat, where there is meritocracy and where people have ownership of what they do. So it isn’t about one person trying to drive the company forward.
We have close to 350 people that own different parts of the company that we are building. The mistakes, as such, happen in a smaller way and in a more microscopic way. So we have a lot of experiments in the company from blog shops to optimisation teams. So over time, we compile whatever successes we have and we grow, but the mistakes we quickly rectify.
I spend a lot of time with our investors and our teams. And a lot of ideas come from those people. But I think it’s most important to spend time with our customers. In fact, sometimes our investors actually give us wrong advice because they are not users of our product!
So sometimes they will tell us about what we should do and the trends in markets such as China and India, but they don’t actually use our product because they are not our target segment. So I do walk around, talk to customers, listen to what people say and naturally that’s the way to figure out what’s working and what’s not.
A+M: How often do you directly speak to consumers?
It is quite often actually, and definitely every time we develop a new product. Right now one of our products growing quite quickly is FavePay which is a rewards and mobile payment method.
So the first product we rolled out on the platform saw restaurant brands giving a 10% discount when a consumer used the app. We thought it was a good idea and we rolled it out across 400 restaurants. But after the first two weeks, we saw sales were very low.
So when we talked to the customers, we saw there was no problem from their end, but the problem came from the merchant end. Merchants were actually telling customers not to use the product because of the discount. So they actually wouldn’t encourage customers to use FavePay! This is when we realised our platform sat between the customer and the merchandiser world. So it needed to work for both sides.
The second model we launched was the cashback model where a customer pays in full, but receives a cashback of a certain amount. It is a bit similar to the rewards and points system.
We saw that customers were a bit more supportive, but then over time the conversion didn’t go. Again we went back to listen and talk to the restaurant owners and we found out that their concern was in getting customers to come back. Combined with our data, we found out that the restaurants benefiting were the lower priced-point ones such as the Bubble Tea shops and Yogurt stores because when a customer receives cash back, they would like to spend it little by little (to maximise the amount).
Then we evolved it to the third point, which is what it is today, where the cashback can only be used back at the restaurant you spent it at. When I took this back to the team, my team hated it saying why would you return to a restaurant you just ate at. But that’s the whole point of loyalty and that has been growing over the past nine months.
A+M: Do you feel a threat coming from the Samsungs and Apples of the world?
Systems such as Samsung and Apple Pay are not working in this part of the world because consumers are not using them. So while they are large companies with hardware, consumers are just not using it. Actually the real enemy of the ecosystem that we are trying to build is cash.
In China, where in the past people carried stacks of cash, the economy has now shifted from paper to mobile payments. People don’t even want to accept cash. It is quite incredible that in 10 years people have moved from cash to mobile, when cash existed in China for centuries. Cash has been replaced in just 10 years.
For many countries, shifting to digital will help counter corruption and people won’t have bags of cash stored in their houses!
Simplistically, if payment was made digital, you couldn’t possibly transfer money without leaving a trace in digital, unlike with cash.
A+M: How far are we from a cashless society?
We like to think it will take much longer than it actually will! Often, once there is an acceleration, the adoption grows exponentially. When you look at digital payments, it is mostly card and mobile payments. So I think it will take no longer than 10 years, probably in five years, as you see most payments moving to digital formats.