BSG issues report on crisis and B2B in Asia

PRESS RELEASE

Impact of global economic crisis on Asia’s B2B media industry: Online revenues holding up well, exhibitions and publishing weakening

Hong Kong, 30th March: Business Strategies Group (BSG), the only consultancy in Asia specialising in B2B media and events, has released a new report analysing the impact of the global economic crisis on the Asian B2B media industry.

Key players including Alibaba.com, Global Sources and CMP Asia have all weathered the economic crisis quite well so far. Alibaba.com’s 2008 revenues increased 39% year-on-year. Global Sources’ revenues came within guidance increasing by 14% and CMP Asia’s revenues jumped by 19% in 2008.

The leading companies have reacted to the economic crisis with a variety of initiatives and strategies, but there are some common themes.

There is an emphasis on new markets to generate alternative sources of growth. Both Global Sources and Alibaba.com allocated additional resources to India in 2008. Alibaba.com is also making a concerted effort to diversify its paid supplier base outside of China – including more markets in Europe.

Both Alibaba.com and Global Sources have restructured their core online offerings to create lower cost products. Global Sources has discontinued a non-core business and has focused more resources on big buyers services (i.e. Private Sourcing Events).

In a show of confidence, both Global Sources and Alibaba.com have repurchased shares. Alibaba.com has board approval to repurchase up to US$258 million worth of shares on the open market. Global Sources bought back US$50 million worth of shares through a tender offer.

Business events, primarily sourcing exhibitions, have held up well until now, but most organisers are expecting 2009 to result in a significant drop in business. Consequently, governments around the region have launched a number of initiatives and schemes to boost the sector.

The Hong Kong government earmarked HK$150 million (US$19.4 million) to promote Hong Kong’s conventions and exhibitions business overseas and is also considering significantly expanding the Hong Kong Convention and Exhibition Centre in Wan Chai. The Hong Kong Tourism Board set up a new team, “Meetings & Exhibitions Hong Kong” (MEHK), to support the industry.

Singapore has established a US$60 million fund to boost tourism including the MICE and business travel sectors. The Singapore Expo venue is undergoing a facility upgrade. The Media Development Authority in Singapore has committed US$60 million to support its media sector.

Taiwan, Korea, Thailand and Malaysia have launched comparable efforts to support their MICE industry through subsidies, promotional activities and venues expansion projects.

BSG Principal, Paul Woodward, commented, “We are anticipating a challenging, but eventful year in Asia’s B2B media industry. 2009 will undoubtedly be a down year for the exhibition business, but the impact on the B2B online sector is still an unknown. Global Sources’ 2008 online revenues increased by 24% and Alibaba.com’s by 39%, but the key question is: how will their revamped online products will hold up this year.”

This BSG report was distributed on 26th March to BSG subscribers of its Asian Business Media Tracker service. The report features over 30 pages of information and analysis covering the impact of the economic crisis on key B2B media companies including Global Sources, CMP Asia (now UBM Asia), Alibaba.com and the HKTDC as well as a detailed review of the activities of governments across Asia. The report is also available for purchase on a stand-alone basis.

For information, please contact:

Paul Woodward, Principal, Business Strategies Group Ltd.
Tel: +852 2525 6163
e-mail: paul at bsgasia.com

Distributed through Edelman on behalf of Business Strategies Group Ltd.

Marsha Ho
Edelman
Telephone: 852 2837 4705
Fax: 852 2804 1303
Email: marsha.ho at edelman.com

ABM quotes BSG on Asia

ABM, the Global Association of Business Information Companies (née American Business Media) has published some thoughts on Asia and the crisis from BSG's Paul Woodward in its Global Industry Insights e-newsletter. We say:

Given the number of resumés arriving in Hong Kong from the US, it would appear that there is some optimism that Asia can provide some reprieve from the worst of the downturn. The truth is more mixed. Research Business Strategies Group (BSG) has been preparing suggests that, while the region has certainly not escaped the downturn, there are some bright spots.

In the same edition, Neal Vitale of 1105 Media talks about China. he says:

In the January edition of ABM's Global Industry Insights, Tom Gorman of Fortune China noted that China will offer "solid, if slower, growth for well-managed media businesses with strong brands." At 1105 Media, we couldn't agree more.

ABM is gearing up for what it is calling its first Global B2B Day during its spring meeting at Amelia Island in Florida in early May.

Twittering

One of our jobs is to track trends which may affect the businesses of our clients in B2B media companies in the next year or so. It is clear that Twitter, love it or hate it, has reached a critical mass in the past few months and engaged the consciousness of business people and particularly media business people.

Once dear old Gary Trudeau of Doonesbury picks up on a tech trend - he's no spring chicken you know - you know its so mainstream that it may almost be over. However, we press on.

The only way to work out what all this means is to use it. So, I have started twittering at pwoodwardhk. Do follow me there if you're interested. I'm learning that people are increasingly using it less to post on the colour of their socks (mine are red by the way), but to provide links to tidbits of news and insight relevant to their particular interests.

I just posted on Jack Ma's interview with the New York Times:

#Alibaba's Jack Ma tells New York Times that recession will last 3 - 5 years: http://tiny.cc/vdN2M

I can't promise that some of it won't be trivial, but I can promise that I'm trying to work out whether this does any more for a business than burn up staff time.