Is the concern over still-low Internet use or because the Internet isn’t used to its full potential?
I am concerned that its full dimensions are not being seen in the correct manner. The Internet is being taken only as a communication channel, and nothing more. The Internet’s vision among companies is incorrect. There are great possibilities out there because the Peruvian user is the most sophisticated one of all Latin America. Mine for example, is a common case: I wanted to buy books and since I couldn’t purchase them here I had to find international portals and pay more. So there is demand, but there are no offers.
Is there really a demand? Internet purchases are not large scale…
Of course there is. Everyday there are around 580,000 searches for financial services on google.com.pe, made by a number of people that could easily fill the national stadium twice. They could do related searches and generate businesses. If a person wants a credit card they could ask for additional information without having to purchase anything. That is why I am certain that in the long run the internet will be Peru’s great business catalyst. But we have to accelerate this process.The conditions are there but we have to put internet in the agendas of marketing agencies working for companies. Here in Peru we are not moving beyond Google searches. We are missing that final step where the consumer clicks on a link, sees and offer and buys.
Do you think Peruvian entrepreneurs are a bit fearful of investing on the internet?
Certainly. I even believe that people on the field don’t have the correct numbers. About 30 percent of Peruvians have had access to online tools (they have emails, have chatted…etc), but only a mere three percent of all Peruvian publicity is done on the Internet. There is still a long way to go. Entrepreneurs still prefer traditional methods.
How much of an investment should they make on the Internet?
I think 10 percent. And I think Google Peru could push for reaching this goal in 18 months. These days (the beginning of the year’s trimester) companies are in the process of determining 2011 budgets, and this is a critical moment for us, in trying to make the Internet be included in those budgets.
An important factor on investment decisions is effectiveness…
There are several ways to determine the effectiveness of the Internet as a vehicle. It could be downloading a catalogue, going on a page, chatting or also shopping. But beyond the rate of effectiveness, what really matters in Internet media is being able to measure direct results, analyze brand trends and measure other media’s advertising campaigns. That is why we have to reconsider this resource.
Cost is another issue, is online advertising cheaper?
I would say that it is better to look at it from the point of view that it is not a high risk. For example, in a traditional media campaign $30,000 would mean six pages in some newspaper, but on the Internet it could mean two months of advertising. There is more to gain and there is a way of measuring it.
And how will Google achieve an increase on Peruvian Internet advertising?
We are going to bet on educating advertising companies, publicity companies and Peruvian universities, where there is a lot of talent to develop technology tools. We plan to work with each of these. We plan to bring in world expert on topics like retail, and finance. We want Google’s message to reach a wider scale.
What sectors do you want to reach?
Tourism, because it has focused on using the Internet. Just ask yourself, how many tourists arrive to Peru having paid for tickets, lodging and tours through the Internet? We will also focus our efforts on getting retail stores and the finance sector.
Have you made any deals yet?
In Google Peru’s first month in operation we already made a deal with an important local bank and we are talking with retail companies.
Who will be Google’s competition in Peru?
With only three percent market penetration, I don’t think there will be competition. We are not going to be fighting over a budget with such small magnitudes. If anything I would say we are going to create a market, we are going to look for opportunities. We are here to grow and to accelerate the development of the Internet in Peru.
Should we expect new things in Google products (maps, YouTube) targeted at Peru?
The Peru operations will be mostly commercial, dedicated to working in publicity. A lot of people don’t know but the majority of Google’s income around the world comes from the advertising found on search results. This is a global company and its products will be available to everybody. We are going to continue developing products for cell phone devices. We also have a content platform for editors. We have publicity inventories that we sell in thousands of webs throughout the world, Peru will not be the exception.
The perception of Google is one of constant change, of modernity, how will that be reflected in Peru?
In Peru Google will implement a culture focused completely on innovation and responsibility: in negotiations, in our way of communicating, in our presence in other media, in our events. Google is a company that is looking to generate opportunities for users. This is something that every national manager from the company tries to reflect in their countries. One of the things that surprised me when I first started at Google is how quickly, in less than ten years, it has built a strategy that has taken it to become the most valuable brand in the world. You could think that we come out with one new thing after another, there is a strategy.
And the future?
My answer is what they say in Google Brazil: We are not looking at where the ball is, we are looking at where it’s headed. That is our basic focus on innovation.