Claims and Emphasis of PINC as a reflection of PINC's acquisition philosophy. Analysis of "position" in market and market penetration.
From News Release 11/16/98
"E-Commerce with Eeze" the E-COMM-KIT is a revolutionary new software package that brings e-commerce to the masses without massive overhead.
...A truly comprehensive e-commerce solution, the E-COMM-KIT makes it incredibly simple for businesses to add secure, reliable, and affordable electronic commerce functionality to any Web-site. The versatile E-COMM-KIT can be used in conjunction with a Planet City-provided back office support system, or with any other back office system the user wishes to employ.
The E-COMM-KIT contains everything that a business needs to take full advantage of the myriad of opportunities that e-commerce offers. In particular, it provides simple tools needed to set up a commercial Web-site, including more than 100 templates and Web icons, as well as Web design tutorials. In addition, it includes ready to post banner ads, provides users with the ability to easily create on-line promotions and search engine links, and also offers simple financial features to keep track of sales (fully portable to most popular accounting packages). Other important features include a client database that allows businesses to keep track of their customers, a comprehensive inventory control system to monitor sales and product inventory levels, and credit card authorization facilities that use the latest generation security protocols on the Internet.
"The E-COMM-KIT is the truly the first e-commerce development package that includes absolutely everything that a business needs today to create a world-class e-commerce site," said Rudy Rupak, President of Planet City Software. "When the E-COMM-KIT is used in conjunction with our highly flexible back-end processing service, the result is a fully integrated e-commerce solution that is easier to use and significantly more cost-effective than any other competing alternative.
Buyers of the E-COMM-KIT will automatically qualify for 3-months of complimentary backend processing from Planet City, after which a monthly fee based on a percentage of sales will be charged. Unlike other vendors that provide e-commerce back-end services, Planet City's E-COMM-KIT eliminates the need to have a dedicated e-commerce server and 24-hour connections to the Web. Instead, the store manager simply needs to turn on their PC and connect to the Planet City back-end to learn if any orders have been placed for their goods or services.
Planet City Software plans to focus its sales and marketing efforts for the E-COMM-KIT towards computer resellers, as these are the sales organizations which most small businesses approach to learn more about developing an e-commerce site. With the E-COMM-KIT, computer resellers will now have access to the first fully integrated, out-of-the-box retail solution that can quickly and affordably satisfy the e-commerce needs of their small business customers..."
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Words in italics represent claims made.
These words are...
revolutionary and first
These words are very bold assertions. The e-commerce suite certainly isn't the first product in this category. E-commerce suites aren't new and thus revolutionary for their newness or uniqueness.
Then just what makes PINC's product a first and revolutionary one, at least, according to PINC?
The words in bold type are the basis for PINC's assertions. These words include the following:
Include, inclusive, comprehensive, integrated, simple, affordability, without massive overhead, versatile, et cetera.
These words obviously are repeated for a reason
Thus, according to PINC, why the product they acquired is revolutionary is because it is the first to offer a comprehensive inclusive simple user friendly cost effective and affordable way for businesses to launch e-commerce sites.
Is this true? Has PINC distinguished itself by building (or shall I say acquiring) a better "mouse trap"? Is their product the "best of breed" product that also offers economies, tools and services that it competitors don't? Certainly, after quickly looking at some of PINC's competition, many of PINC's competitors have lackings. But without the time or even the product, I can't personally verify that PINC's claims are true or not. I can't even say that since PINC's product is an acquisition that it already isn't on the market in some form? Is it?
Will PINC effectively market its distinctions to gather market share?
Does PINC need to be the major market player considering the brand named competition (e.g. Yahoo) it has?
How much market penetration does PINC need to obtain to sustain high enough growth (20% plus for tech firms) and attract additional investor interest?
Apparently PINC bases it acquisitions (y2k and e-commerce so far) on products that offer ease of use, and comprehensiveness at low cost targeted to the "masses" therefore, allowing for greater accessibility especially to the "computer hesitant" and computer phobic.
Such an acquisition philosophy is consistent with the computer industry, in general, that is trying to broaden its appeal by lowering its entry costs and make ease of use a priority.
Ease of use and low cost are two of the major universal themes prevailing currently at COMDEX.
I've personally been impressed by PINC's marketing strategies and acquisition philosophy. Their hiring of MZD , or shall I say, being accepted as a client by MZD give PINC legitimacy that many detractors haven't seemed to realize. After talking to one of my sisters, who works for one of MZD's competitors and is of some acclaim herself, and hearing her high regards for MZD and Mr. Zuckerman, attacks on PINC for the company they keep are downright silly. I'm kicking myself for not calling my sister sooner and until Greg Kraft's questions made me of thinking to do so.
Now it still remains to be seemed whether the y2k market materializes as promised (i.e.. as large as projected) that PINC bases its near term growth on. Will concerns and "fears" generated as much by media attention as by actual problems, make people run out their doors to buy y2k fixes? Time will tell. My crystal ball is broken.
It remains to be seen whether PINC's e-commerce suite will be embraced in what is going to be a huge market with many well financed competitors.
What may occur in such a growing market for e-commerce is consolidation. If PINC's e-commerce product (and other products) are what they claim to be, PINC rather than making additional acquisitions may become acquired instead.
Then again my prognostication, unfortunately, only seems to work in retrospect.
So who knows, I certainly wouldn't recommend this stock to anyone who wasn't very risk adverse especially in the world of technology where
the latest freeware, gizmo, and merger can adversely effect even the best company's bottom lines.
Though I remind others that marketing of a product in the world of technology is sometimes as important as the quality of the product itself.(E.g.. does anyone really want to make the claim that MSFT has the best OS, and Intel the best chip).
Anyway, enough for one night.
ztect
cc. Greg Kraft (for company answers to questions posed in the context of this analysis for whatever value anyone wishes to attach to them).
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