rediff.com
X   
REAL-TIME QUOTE
Enter Company or MF
e.g. Tata motors, Reliance MF, 500570
Intrasoft Technologies Ltd.: Experts' corner
533181 ISFT Group (B) BSE data
Back to Company Page
Management speaks
Arvind Kajaria
Arvind Kajaria
Managing Director
Intrasoft Technologies Ltd.
March 21, 2011, 6:16 pm
Why should an investor buy your company's stock?

Intrasoft Technologies Limited (ITL) owns the website www.123greetings.com, which is the second-largest electronic greeting card website in the world. Our flagship website has witnessed an exponential rise in consumer numbers year on year ever since our inception in 1996. Strong search engine optimization (SEO) competency ensures we are among the Top 5 results with any key search word on greetings. Our entry into online shopping creates a huge business opportunity in the US, coupled with over 90 million unique visitors on the site, and throws open huge prospects to build scale and monetize users.

 

  • Largest website in terms of unique visitors: ITL is the largest e-greeting website in India, and the second most visited e-greetings website world-wide in terms of unique visitors. This growth has been largely based on viral marketing and the company’s SEO prowess. The strong market position makes the website a prominent destination for e-card consumers and also for over 140 advertisers across industry verticals.
  • Advantage over subscription-based e-greeting card companies: ITL’s strategy of free e-card services over traditional paper cards has worked well to attract consumers. Currently www.123greetings.com has over 20,000 proprietary greeting cards for over 3,000 seasonal and everyday categories.
  • Looking to diversify geographically: ITL is looking at expanding its geographical presence beyond its US-centric focus by customizing content of the website in local languages (123Greetings Studio) to meet the competition in new markets effectively. The newly launched “E-Invitations” feature allows users to send customized event invitation cards that provide information on venue, guest list, menu and likely weather conditions.
  • To leverage its Internet capabilities: With its core business model in place with scalable cloud computing technology, access to a talent pool and dedicated consumers, the company has been looking to leverage its Internet capabilities in related businesses which we believe could lead to exponential returns in the future.
  • Entry into online gifting services: ITL has successfully forayed into online gifting services through its website www.store.123greetings.com. E-commerce is a key business in the US; the biggest US companies Amazon and eBay are an indication of the opportunity that exists in the e-commerce segment. For a company which has successfully been able to garner traffic in a highly crowded greeting cards segment with its search engine optimization prowess, successful execution of its e-commerce model could bring in exponential returns.
What events do you expect in your industry sector over the next few months? Are these hurdles or catalysts?

E-cards became popular immediately with the advent of the Internet. With the Internet taking off, opportunities are increasing at a fast pace. With digitalization becoming prominent and youngsters having easier access and better knowledge of the Internet, traffic is expected to keep growing in India and worldwide. The segment continues to march forward; as per our estimates, a billion e-cards are sent every year on an average. Social media websites and mobile applications are gaining momentum. There is an opportunity in developing customized applications on those social media sites (http://www.facebook.com/123GreetingsCom) and take advantage of their huge traffic. There is also an opportunity in mobile applications as the number of mobile subscribers is rising. These opportunities will serve as catalysts to increase our popularity.

What growth initiatives has your company planned?

We are developing with the changing taste and requirements of Internet users. A large portion of the e-cards business involves impulse buying, which means we have to be present at the maximum number of places. We like to use a combination of technology and human resources to reach that objective. Some of our current growth initiatives are:

  • To continue to monitor and improvise on our proprietary algorithm used for search engines to derive maximum points of distribution. Resources are currently employed to test new keywords and ensure our rankings.
  • We launched a new version of our Facebook applications. Resources are employed to market among user groups, increase the fan base and promote keywords within the Facebook engine. Potential to extend this application to other social networking sites exists.
  • Our studio has the power to attract artists, who in their own interests, similar to what developers did for Facebook, would market their own cards, thereby popularizing the 123Greetings platform. Resources are currently employed in seeking out new artists and educating them about the studio and guiding them on putting up their creations. Over time, we believe this will become self-fuelling.
  • Invites: This feature greatly complements our e-card business. We want to be the single source for folks who can send e-cards as well as invites through our simplified Connect feature which allows them to store all their contacts permanently.

 

Who is your competition? What differentiates you from them?

Our competitors include American Greetings and Hallmark. American Greetings is one of the two largest greeting cards company in the US.

 

Our Competitive Advantages:

 

  1. 123Greetings attracts almost 100% of its traffic onto www.123greetings.com. The traffic comes from search engines, social media websites, top-of-the-mind recall, bookmarking and from the thousands of backward links that 123Greetings has accumulated over the years. 123Greetings enjoys brand recall as almost all the traffic comes directly on the site. Some of our competitors rely on external traffic for growth.
  2. While searching on the Internet, 123Greetings is No.1 for virtually every greeting card related keyword. 123Greetings enjoys a significant advantage as far as SEO techniques are concerned due to its proprietary algorithms.
  3. 123Greetings is completely on a cloud environment. This makes it completely scalable as well as cost-effective. We are capable of handling the massive spikes on Valentine’s Day. We have seen competitors’ sites slowing down on such days.
  4. We have features like Connect, Studio and Invites. These features appeal to users and are a must for any Internet site.
  5. American Greetings operates in a high-cost environment and therefore is unable to meet its cost obligation through advertising. It therefore has to charge its users, thereby greatly reducing the traffic to the website.
  6. 123Greetings has its application on Facebook to attract the increasing traffic on the site.

Hallmark.com is the third largest player in the e-card business. Hallmark paper cards are one of the most popular firms in the segment and have been around for decades.

How do you see your company performing over the next financial year?

We plan to scale up both the topline and the bottomline in the years to come and become a much larger company. The growth should be such that it meets the expectations of all the stakeholders.