Special Report: Shop opens doors to Asia

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The Web connection has built a strong reputation in China, Hong Kong, Japan, Singapore, South Korea and Taiwan as an e-business integrator, developing online strategies and solutions both for major corporations and local dot-coms.

Today, the Hong Kong-based company is reinventing itself as a passport for American companies that want to reach Asian consumers--whether they live in New York or Beijing--through major acquisitions in the U.S.

In April, the Web Connection bought a majority stake in Dae Advertising, a San Francisco-based interactive agency that specializes in reaching Asian Americans (as well as Latin American consumers to a lesser degree).

'NAVIGATE ASIAN WATERS'

Dae is still run by co-founder and President Wei-Tai Kwok, but will be rebranded as the Web Connection by the end of 2000.

One month earlier, the Web Connection acquired TKAI, a professional services firm with offices in Portland, Ore., and Tokyo focused on helping U.S. companies succeed in Japan's thriving e-business market.

Clients now working with the Web Connection through these mergers include Amazon.com, Outpost.com, Wells Fargo, Hewlett-Packard Co. and MCI WorldCom.

The agency hopes to start up another office in New York focusing on its "core competencies--digital strategy, technology integration, creative design and online marketing" by the end of this year, says Steve McKay, president and chief operating officer in Hong Kong.

"Our U.S. entry is still very much about Asia. It would be unnatural just to compete with U.S. agencies. Most enlightened companies already recognize the opportunities in Asia, but they're scratching their heads about how to handle it. We want to be on their doorstep and help them navigate Asian waters," he explains.

Last year, about $6.6 billion was spent online in Asia, according to eMarketer 2000.

This year, Asians are expected to spend an estimated $15.4 billion online.

EXPANDING TO INDIA

The Web Connection is expanding on the other side of the Pacific ocean as well. An office in India will open within the next 12 months, and last month the Web Connection announced a strategic partnership and buyout agreement with the Australian Internet integration company, XT3.

The transaction marks the Web Connection's debut in that market, although its sister agency, 24/7 Media Asia, already operates in Australia.

"We had a choice between floating XT3 or going down this route with Web Connection," explains Hugh Morrow, managing director of XT3 in Sydney. "After careful consideration, we made the judgment that a float would not offer us the advantage of leveraging Web Connection's regional client base and e-business expertise."

MYRIAD OF ASSIGNMENTS

Those regional clients have handed the Web Connection a myriad of assignments.

It helped financial services giant HSBC Group with its global rebranding campaign two years ago, including actively shaping its online business and branded presence.

For General Motors Corp. in Taiwan, it orchestrated an eight- day online promotion and e-commerce blitz last June that generated 90,000 site visitors, 2,000 registered users, 262 test drives and 30 cars sold.

For Looks.com, a Hong Kong-based beauty and cosmetic e-commerce site, "we developed (the site) from the idea stage to the URL, which was launched last December. Today it's also doing business through joint ventures and affiliates in South Korea, Taiwan, Japan and Australia as well," Mr. McKay says.

Although he joined the Web Connection in April 1999, Mr. McKay's relationship with Web Connection dates back five years to the creation of Monty Wong's Web shop (www.montywong.com), possibly Asia's first e-commerce site, that sold everything from books and furniture to food items. Web Connection operated the site for about a year and a half, then decided to focus on providing high-end e-business solutions for marketers going online.

A 12-year veteran of Andersen Consulting and experienced IT expert, at that time Mr. McKay was a director in the consultancy's technology practice in Hong Kong.

He was approached by Internet pioneers Ian Henry and Peter Hamilton, "who tried to get me to invest in their company," he recalls of his first brush with the Web Connection's founders.

WORST CLIENTS EVER

At the time, they had little more on the table than Monty Wong, a haphazard site selling everything from sandwiches to Christmas trees.

"They were two of the worst clients I ever had," Mr. McKay jokes of his current employers, who, shaky origins aside, have gone on to build one of the strongest Internet companies in Asia.

Mr. Hamilton is chief operating officer and Mr. Henry, president, international of chinadotcom corp., the parent company of the Web Connection. As one of the leading Chinese portal sites, chinadotcom at the end of first quarter reported 4.5 million registered users.

Monty Wong, alas, was finally shut down at the end of 1999.

"We didn't sell any Christmas trees last year," laughs Mr. McKay, shaking his head at how much the Web Connection has matured in five years.

Copyright June 2000, Crain Communications Inc.

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