In Conversation with Alfred Chong, CEO of 121View

A few weeks ago, we profiled the global markets that Singapore-headquartered, digital signage company 121VIEW has penetrated into.

This time, we managed to speak with Alfred Chong, CEO of the company, who sees 121VIEW’s continual growth and success as tied to the advertising industry. A serial entrepreneur, he lived and worked on companies in several countries such as the US, Malaysia and of course Singapore.

For his first company, Alfred borrowed USD 1k and grew it to one doing USD 8m, eventually selling the company. Find out his story here.

Hi Alfred, thank you for joining us at SGEntrepreneurs. You have been named “Entrepreneur of the Year” by the Singapore American Business Association and called a “visionary” by the San Francisco Chronicle. Can you tell us about the startups you have worked with prior to 121VIEW?

Yes – this is quite sometime ago – when I was living in the US. I returned from the US back to Asia in 1999. During that time I had initially lived in Malaysia and moved back to Singapore circa 2005.

In Malaysia, I had initially focused on the energy sector. The most notable startup – in which I was a founding member was for a company called Iev Energy. The company focuses on delivering virtual pipelines and gas into stranded areas. There is so much to talk about this company but the information is embedded into the website. I remain a shareholder of the parent company – iev-group even today.

How did you manage to borrow USD 1000 for your very first company that was eventually sold to CompuCom Systems Inc and how did you use the money?

After completing my MBA, at the University of San Francisco, the advent of Personal computers came about. I had borrowed USD 1,000 to start a garage styled PC business that grew to an USD 8m company, employing over 80 professionals. We had offices principally in the Bay area.

How would you differentiate 121VIEW from other digital signage players?

There are hundreds of players out in the market today. Our differentiation lies in our software. Built from the ground up and on linux, we pride ourselves in being able to offer the industry a fully integrated Digital Signage software with audience measurement attributes. This may sound trivial but we are only one of two companies that own our IP on both fronts. Most of the current DS companies have “bolted on” the audience measurement capabilities from one of our competitors. However, we are the only one that runs on linux and thus offer complete flexibility to the enduser on how they would want their DS system to operate under.

Why go into the digital signage industry for this current venture?

In any venture, you always look at the market sizing, its potential and see how you can build a business that can address this market.

Global Ad spend in 2009 at US$450bn, with prediction of growing to US$457bn in 2010.- according to Zenith Optimedia. Even though outdoor media is the smallest percentage – about 1.7%, it has the second fastest growth rate after Internet Advertising.

The ability to scale our business model to the addressable market will be our challenge each year as we grow – especially when we embark on our exit strategy. If you look at companies that have been successful – Focus Media, AirMedia, Vision China, they did not go to market as a Digital Signage company but rather as advertising companies.

Was there any particularly difficult time when you were trying to start up?

A company is a reflection of its people and the product it makes and the people it sells to. This then translates into sales opportunities that will drive the revenue of a company. You take away any of the above ingredients and you end up with failure. For some time, we were very focused at the product development stage and lost sight of closing deals. This changed when we got our first large deal – which underscores the tumultuous environment that we live in and how finicky customers are in making decisions.

What was the one thing that on hindsight was the best decision you ever made for the company?

In the last decade, we made Google a verb; revolutionized how music is distributed and marketed with the iPod; cruised confidently with our GPS devices; controlled thousands of applications with just a touch of fingers on our iPhones; downloaded and read our books on Kindle; and gave birth to social networking like Twitter and Facebook.

The success of Google is legendary, evident not only by the share price of its stock, but also the fact that Google has become part of our vocabulary, a vernacular in our society and a verb! This is a rarity since verbs account for less than 15% of the Webster dictionary. Verbs are closer to us and the birth of Google-ing crystallizes the fact that so many of us are veraciously seeking new information about our world, no matter where we live.

Google‘s powerful information mining tools allow us to dig into and access invaluable data which is coveted by marketers but was very expensive to obtain in the past. Google Trends and its big brother Google Insights provide a glimpse into the power of Google’s incredible query database.

So how does Google’s evolution relate to 121View? I am often asked if the emphasis on Audience Measurement should be the corner stone of our growth strategy in the future. Indeed we have allocated a large portion of our R&D budget, supplemented by two grants from the Singapore government, to become one of only two fully integrated Digital Signage solutions worldwide with our own technology and homegrown IP.

Our accurate customer recognition technology has allowed us to differentiate ourselves among hundreds of other digital signage providers worldwide . One of the most difficult challenges facing the advertiser today is measuring and quantifying the ROI for their Digital Signage investment.

Our web based customer recognition module solves this dilemma by effectively and accurately determining who is looking at a screen and for how long, thereby providing a real-time account of the effectiveness and potential profitability of the advertising campaign. Taken a step further, we have also built a billing module that can integrate billing based on each “view“.

This is where I believe we can draw a comparison between 121View and Google: as Google has provided the ability to measure clicks, the advertisers who use our technology can now count the “views” and charge their customers based on the actual and documented views by each male, female or other categories of audiences.

What do you think is the future of outdoor advertising?

As we start the new decade, the pundits of Digital Signage maintain that the industry is continuing to grow at an increasing rate on the heels of a worldwide recession. Overall responses to the Digital Signage Expo Business Barometer survey indicate a 13% increase for DS spend in Q2/Q3 compared to Q1/Q2 of 2009 and reflecting an upbeat sentiment for the future.

Respondents also affirmed that in their views, the economy has stabilized and on the upswing relative to overall advertising market. According to PQ Media, DOOH is expected to grow only 2% in 2009. This may not seem much but compared to the first nine months of 2009, newspaper ad revenues fell 28.4%, according to the Newspaper Association of America, radio fell 21%, according to the Radio Advertising Bureau; TV fell 15.7% according to the Television Bureau of Advertising and Internet ad business went down 5.2%.

One consistent theme resonated in the Out Of Home (OOH) advertising business climate where they cautioned that advertisers are extremely vigilant about their OOH investments and are looking for documented and well-defined ROI.

Care to share with us any exciting upcoming projects?

We had recently crossed our 2100th screen installation. This year’s pipeline is goaled towards tripling that for this calendar year. Our biggest market is in the US, followed by the Philippines and possibly Thailand. Recovering from a very slow 2009, 2010 seems as though it will be a very good year. We remain cautiously optimistic about these prospects from opportunities in the US, Philippines, Europe, Thailand and Singapore. Often we need to constantly remind ourselves that we are a small company reaching out for the worldwide market. Thus, we need to be cautious of not over reaching.

What would your biggest advice be to an entrepreneur starting out?

99% of most start-ups starve themselves because of the lack of cash. Bright ideas, Great endeavours vanish in the absence of cash. Find yourself a financial partner whom can help you grow or you will spend more time raising monies than focussing on core operations.

Thank you very much for your time, Alfred. All the best in the growth of 121VIEW!

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