After graduating at the top of his class in Germany, he decided to return to the land of his birth and maximize the vast opportunities that lie untapped.
And in just two years, his brainchild hotel.ng is transitioning into a behemoth providing services to over 5000 hotels nationwide.
Last year his company recorded had a total of about 1 million hits on the website from within alone making it the biggest hotel booking platform in West Africa.
With just 15 full-time employees, 5 contract staff and more than 70 ad-hoc workers, who do most of the ground work signing up hotels across the nation, hotel.ng was able to accrue an average revenue of N7.2 million per month by the end of 2013.
In terms of year-on-year growth analysis, all his key metrics – namely the number of bookings, hotels, traffic and returned customers – have jumped by 125 percent growth.
However, in spite of the success he has achieved, he is bracing for a stormy season ahead.
With pundits differing on the degree of impact the fiscal crunch on the economy due to the continual slide in the local currency and falling oil prices will have, Essien is of the opinion that his industry will experience the greatest blow owing to the fact that, more often than not, shopping for commodities via the internet is considered a lavish venture for the opulent.
In his words, he says, “I think the ICT sector will likely be hit the hardest because this is often perceived as a luxury; people need to have money to buy food and clothes before they think about buying data (internet bundles) or shopping for goods and services online. If inflation rates keep going higher and oil prices continue to drop, most people engaged in e-commerce activities (in Nigeria) will most likely have their revenues slashed by 50 percent.
“Many people are not feeling it yet because the trickle down effect has not started to take place yet. Usually we would expect that billions of dollars would flow from the government into the economy once the budget comes out but the budget allocated this year is barely half of what was put to use last year. This means that by July when the elections are over and the merrymaking subsides, the impact of the crunch will felt in its full measure.”
For the afore-mentioned reason, smart entrepreneurs are opting to develop their businesses in other countries with similar landscapes but different economic prospective.
Read also: World Bank advises on rebuilding buffers as falling oil prices seen to persist in 2015
Although, uncertainties about the future of the local cyber-sector abound, Mark believes that if proper offline-online integration systems are put in place such that the private sector cuts funding on heavy infrastructure by at least 40 percent, the economic shock can be cushioned.
Bringing to focus the policy reforms he is hoping the government will make to improve business in his industry especially with elections around the corner, Mark expressed, “The thing that bothers us is the Central Bank of Nigeria’s requirement for two-factor authentication in payments. This means that when anybody makes an online transaction in Nigeria, you cannot just enter your card numbers and click on the ‘pay’ option. You would have to enter that card number and you will be asked for a ‘token’ or ‘pin’…there is always a second thing you would have to do and every payment provider has to oblige to this rule.”
Although the CBN says this directive was given as a means to check fraud, Essien believes that the ambiguity attached to simple transaction processes carried out on the internet creates some degree of merchandizing apathy for customers and invariably dwindles sales.
“This rule,” he says, “is hindering the adoption of e-commerce because it makes it cumbersome. From research, we have seen about 50 percent failure rates because of this burden. A lot of people do not have their token’s with them all the time or the OTP’s they registered for is taken a long time to arrive and at the end of the day the look for other alternatives.
“Yes, it is a means to check fraud but this does not exist anywhere else in the world. The way other check fraud is to do it retroactively; first you do the transaction and then they check for fraud. They do not assume you are guilty till you prove you are innocent; they assume you are innocent till you prove you are guilty.
“This assumption that everybody is trying to perform fraud before a transaction is made should be removed. Companies should be given the option to say that we know this user, we have tested and trusted this user and we do not want this customer to go through extra stress. The failure rate from this ‘two-factor authentication directive’ is too high and it is out of our control because it is between the payments provider and the various rules that they have to follow.”
While struggling to surmount service delivery hindrances imposed by the federal charter’s financial power-house, Essien insists that as long as the government refuses to transit from a system of enthroning propaganda to actually implementing the reforms proposed in the many manifestos made public, footing the cost of high internet and power bills are realities they are forced to live with.
However, Mark, who received an M.Sc degree from the Freie Universität, Germany, recommends a few solutions for the in-coming leadership to adopt. These changes he says, will drive local business sector growth and increase foreign direct investment participation across board.
According to him, “The government can accelerate the adoption of e-commerce by completing the internet-fiber connection it promised to do ages ago. From what we were told, along Herbert Macaulay (which is the current hub for ICT in Nigeria) they were supposed to install wireless points such that all I would have to do is buy a radio and then capture the signal but none of that is happening.”
With respect to power supply, the info-tech systems programmer creatively suggests a rotational mechanism that optimizes the less than 6000 megawatt energy generated by the Power Holding Company of Nigeria.
He posited, “There is a limited amount of power that is being produced and it is obvious that we do not generate enough to meet the demands of a 150 million strong population. The way that power fluctuates is very bad and if we had some certainty, we could put in measures that move us towards a more positive reality. The State government should consider a more regulated allocation of power so that during the day, Central Business Districts should have electricity while the residential areas stay on a ration until the night time when electricity can then be transferred to the residential zones. This will give corporate management some sort of avenue to plan their systems and schedules and encourage more investors to participate in businesses here.
Revealing his organizational projections for the new business year, he stated, “I think this year is going to be very interesting. Last year, we were focused on optimizing our processes and getting to profitability in one region which we achieved. At the moment, we are already generating four times as much revenue as our expenses.
“In 2015, we are going across West Africa with Cote d’Ivoire and Ghana as pilots. In Nigeria we already have a formula that works; we just need to start replicating in these other countries.
“If you compare the end of the year to the beginning of 2014, we went from pumping in money into the business and loosing it to generating 4 times our expenses.
“Over the next one year, we are going to be doing a lot of re-investments so we are not going to be as profit-focused as we were last year. Now that we have solved a lot of the little details that made it tough in the first one year, we now know how to go about generating more money and I would not be surprised if we achieved 10 times the income of what we are achieving right now,” he concluded.
