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Is Speak Asia doomed to fail?

Posted by Neeraj Kumar on May 13, 2011

My wife one fine day says, “I need Rs 11,000”. It is customary on our side to donate amounts to the tune of 11, 111, 1100. But, 11000? While my brain was going in 11000 different directions, “Its for Speak Asia.”, she says. “Speak what?” I asked. I knew she was up to something but, to score points with her (11000 big ones), I said, “yes” making sure it sounded as if its not big deal. Salaried people tend to think about, at least at some level, of every money that they spend. So, I decided to do some research. I typed “Speak Asia” in Google and the next word google suggests is “Scam”. Oh boy!.

What is it?

It is paid survey where you get Rs. 500 per survey and can earn up to Rs. 4000 per month if you pay subscription fee of Rs. 11000. You further get paid for direct and indirect referrals. If you are able to build strong enough network, there is potential to make big money.

Why so much skepticism?

You have to pay up front subscription fee of Rs 11000. Incentive model appears flattering and raises questions if it is sustainable. If you have to be successful, you have to get your incentive scheme absolutely right (Freakonomics). There are a few things going against the company (which they promise to fix). They seem to be operating from a black box. Past scams and the depth of corruption in the country make the matter worse.

So, is it sustainable?

Depends. It might not be sustainable in its current form but, will not necessarily fail. Its business is Market research. Do survey and sell the results to interested companies. So, it will be sustainable if it gets simple Math right. Generate enough from survey sales so that it can pay its panelists. Its biggest test will obviously come when the rate of subscriptions go down. In that case the only way it will be able to continue with the payout will be to generate revenues through sales or it will have to evolve/diversify. It cannot and should not rely on new subscriptions to meet payout demand. If thats what they are hoping for, that is fraud (Ponzi Scheme).

Can it evolve? Can it diversify?

It can. Its biggest asset undoubtedly is going to be its network and as a result its brand(ignore negative vibe for now). Network is a big asset. Having a network that you can leverage is quite something. The benefit of Network Marketing is that if you can generate enough momentum, it might carry you through. Its website currently gets about 100 million hits a month and about 1 million unique visitors! What wouldn’t you do to get such a website! πŸ™‚ If you can guarantee this number of visits, which this site can as panelists transact through this, opportunities are numerous. Advertisements being the most obvious. How, about targeted marketing based on the data people fill in surveys? People who are filling the surveys can surely start becoming consumers, right? The fact that they are charging helps you create a demographic. Isn’t it? You have got a set of educated people with some dispensable cash willing to give honest opinion (or else they won’t be paid). What about Facebook? How do you think it makes money? The reason we don’t question, and its a very valid reason, is because we have nothing to lose. But, we don’t question its sustainability, right?

Should you join?

It depends what your take of the company is based on what you have heard, read and experienced. Early subscribers are almost certain to make good money because of the rapid rate of subscriptions. Then it all depends on the view you take of company’s business and its ability to diversify and make money. If you take a positive view, you should invest (buy subscription) or stay away from it. This is true for all companies when you invest in their stocks. The price you are willing to pay for a company’s stock depends on the view you take.

Nobody knows if a company will survive. Wave of speculation can take down the mightiest in a day. That probably is one the biggest thing going against Speak Asia. The thing going in favour of Speak Asia is that the people I know have been paid as promised. So far so good!

Speak Asia vs Indian Media: This is follow up post after press conference.

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