Online job giant SEEKs to adapt
Thursday, 7 February 2008
Last Updated: Thursday, 7 February 2008
By Amanda Gome
Internet jobs site Seek has grown from a tiny start up to listed company worth $2 billion in 10 years. But the share price during the last few months has fallen from a high of $9.36 to about $6.70. Analysts say the industry is competitive and the company's growth opportunities are limited.
Amanda Gome talks to Seek founder Paul Bassat about Seek’s growth plans, the impact of new competition, the business after the exit of founder Matthew Rockman, and life at 40.
To listen to the interview with Paul Bassat,
click here. (Interview length: about 20 minutes)
To download this mp3 file and listen to it later, right-click this link and "Save target as..." to your computer (Macs; option-click).
Amanda Gome: Your share price has dipped from around $9.30 in November to about about $6.70. What happened?
Paul Bassat: We listed early 2005, so we’ve been listed a little bit under three years. We had a very good run with the shares from $2.10 up to, as you say, above $9. Obviously the market has come back a little bit in the last few weeks, and we haven’t been immune from that.
There genuinely isn’t that much of a focus within the business on the share price. The focus is very much around what we’re doing with the business and all the things that are necessary to continue to grow the profits and grow the market share, and the share price is something obviously that we can’t control. We just focus on running the business as best we can.
For financial year 2006-07 you had revenue of around $157 million. And you haven’t reported your half yearly results yet, but what are you looking at?
We report in a couple of weeks, so it’s difficult to go into any details. I think what we indicated to the market at our four year results presentations in August, as well as at the AGM in November, that we expect continuation of the strong growth. People who are coming to the site would see that the ad volumes continue to build. They’re around 220,000 ads at any point in time, so we see a continuation of strong growth, both in the employment business and also in Seek Learning, which is a newer business and is growing very strongly as well.
Some analysts are saying that you’ve got a massive website now with a huge number of vacancies. There’s not much unused capacity left in the market. What do you think of that?
The online employment market (and these numbers are relevant to the year ended 30 June 2007) is about a $200 million in Australia. We’ve got probably about a 70% share of that market. The print market is still a $600 million market, so we expect over the next few years that a large chunk of that $600 million is going to come across in segments like the government market, the education market, the blue collar market, the regional market. All of those markets are still very ‘newspaper’, and much smaller online, so we still think there’s a fairly significant opportunity over the next few years.
You’re strong in government and education. Are you boosting the blue collar and regional?
Government and education are still primarily print markets, so we think there’s a lot of opportunity in those markets and also in health care. Government has been on the whole a little bit slower than the corporate sector in terms of moving their spend from print to online, so we’re very aggressively focused on government and education and hopefully over the next 12 months we’ll increase our focus on the blue collar market as well.
What will you do?
What we’ve done, without wanting to go into detail, hasn’t just been about specific sales and marketing. It’s been a very much integrated approach, so we’ve launched new products, we’ve had specialised sales teams that have focused on those markets, specialised service offerings because the needs of clients in those markets are a little bit different. So it’s been a very much holistic approach to ensure that we really build the marketplace from the ground up.
So you’re going into new areas. What else are you going to do?
We’re going to continue to focus, as well as boosting our presence, in those particular markets – but continue to invest in new product development. We launched a product called ‘standout ads’ literally a few weeks ago, just before Christmas, and that’s a product that allows clients to stand out a little bit more in the search results by including more information and their organisation’s logo.
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