After spending three years in developing and refining its ‘secret sauce’ algorithm, MyFreelys Marketing Sdn Bhd is ready to roll out its customer relationship management (CRM) platform, which aims to transform retail, distribution and consumer loyalty in Malaysia.
CEO Daniel Lim said the first phase of roll-out would be targeted at the mobile prepaid crowd, which make up 82 per cent of Malaysia’s total 43 million mobile subscribers.
“What we want now is to gain traction and gather critical mass to enable us to scale up operations, create multiplier effects and help all stakeholders to derive greater benefit from this platform. This in turn, will help us create stronger barrier to entry; our business model itself will become a barrier to entry,” Lim explained.
Lim told DEALSTREETASIA that the company had explored the option of patenting its algorithm but after considering various factors they decided to walk the Coca-Cola route – keeping it a trade secret and quickly gaining critical mass so that they need not fret about competition.
MyFreelys will be doing a soft launch of its point-system CRM platform by the end of this month, and will begin roadshows around Malaysian universities to get the youth on board.
“We will get young people to sign up first and see what the feedback is. Merchant acquisition is on-going, we already have some food and beverage, retail and petrol merchants on board. Early next year, after we have ironed any remaining kinks, we will launch our mobile app,” he said, while giving details of the immediate plans.
The company’s 2015 plans include, rolling out in Malaysia and Indonesia. The following year, it targets the Philippines, Thailand, Singapore and Taiwan while 2017’s plans include Vietnam, Hong Kong, South Korea, Japan and Australia.
Lim’s goal is to bring the company to initial public offering stage in 2018, in preparation to enter the significant China and India markets.
The Asia-Pacific addressable mobile subscribers market size was three billion in 2013. Of that, MyFreelys is looking at having a third, on board its platform, by 2018.
MyFreelys has secured three partnerships to-date – eGHL, the internet payment arm of GHL Systems Bhd, Com2U Sdn Bhd, a one-stop mobile commerce service provider and MobilityOne Limited, a London Stock Exchange-listed leading electronic transactions and payments solution provider in South East Asia.
At the moment, it is looking for corporate strategic investors to expedite and add value to the company’s business. The company is currently entirely self-funded, with a paid-up capital of MYR two million ($580,000).
MyFreelys, which is established by a team experienced in the telco, marketing and retail industries, had previously explored the options of exclusive tie-ups with Malaysian telecom companies; but this did not work out. Its strategy now, is to work as an open platform for mobile subscribers, across telecom companies.
“We would prefer to work with one telco, but for a start we think we need to validate this mechanism, gain traction and give our merchants a diversified base of customers,” Lim admitted.
The company’s chairman, Admiral Tan Sri Dato’ Setia Mohd Anwar Mohd (R) is also the chairman of the Malaysian Armed Forces Fund Board (LTAT) who joined the board in his own capacity.
MyFreelys’ business model, in a nutshell, links telecom customers to retailers and food & beverages outlets through a rewards programme, and vice versa; giving telecom companies, merchants and advertisers a reach to the wider pool of customers.
The mechanism will give registrants Freelys points, which are shopping credits, based on the consistency of their mobile prepaid top-ups (instead of the proportionate amount spent).
“We are not asking them to pay more or buy a different product, instead we can cultivate loyalty to the telecom or merchants involved,” he said, “And this does not compete with existing loyalty programmes merchants have, in fact, it will complement it as MyFreelys CRM programme.”
The Freelys points will go into a voucher wallet, which the consumers can use to redeem products or services while shopping credits can be used for both online and offline shopping at the affiliated merchants.
The shopping and redemption platform will be launched by the company in January.
MyFreelys takes the revenue it receives from products and services provided to merchants, minus cost of service, and channels it back to the consumers in the form of Freelys points. “If you look at it, everything that we are doing has been done before but it’s all fragmented – the reward programmes, prepaid distribution, advertising, big data, relationship marketing. We have been able to interlink them together to create win-win-win situation through the algorithm we designed.”
Aside from transforming retail, distribution and consumer loyalty, MyFreelys operates against the backdrop of a social enterprise business model.
Lim said the business model includes a pledge that five per cent of the entire group’s revenue had to be set aside for social causes, in particular providing assistance for single mothers, orphans, affordable medical care, quality and affordable education, care for the elderly and halfway homes to rebuild the lives of the homeless.