Conglomerates now investing billions in digital ventures
Iris Gonzales (The Philippine Star) - May 27, 2019 - 12:00am

MANILA, Philippines — Some of the country’s biggest conglomerates are investing heavily in the digital business now more than ever, recognizing the vast potential of emerging technologies both in growing their companies and also in broadening the digital experience of Filipinos.

These companies recognize the risk of being left behind in a rapidly competitive environment if they do not embrace a digital mindset.

As such, conglomerates are investing billions in digital ventures and at the same time, digitalizing their existing brick and mortar operations.

Ayala Corp., the country’s oldest conglomerate, is leading the transformation journey across the group to build a digital and future-ready Ayala, its chairman Jaime Augusto Zobel de Ayala said during the company’s recent annual stockholders meeting.

“As you know, we have started to participate in businesses that are part of the current digital wave; particularly in e-commerce, fintech and healthtech. These investments are designed to complement our group’s traditional brick-and-mortar operations, future-proof our existing portfolio, and broaden the digital experience of Filipinos,” he said.

“We recognize that to continue thriving under a rapidly changing environment, we must evolve from traditional analog thinking into incorporating a digital perspective into our strategy and operations,” Zobel said.

According to Zobel, the group has spent significant time studying other markets last year that are in the advanced stages of digital maturity.

In a recent interview with The STAR, Ayala’s banking giant BPI executive vice president and COO Ramon Jocson said digitalization would allow BPI to become more financially inclusive by significantly increasing its engagement with segments of the market where the banking system as a whole is woefully underrepresented.

Jocson said digitalization would empower clients to bank anytime wherever they are and in ways attuned to their requirements.

In all, he said digitalization is about enhancing clients’ experience with the bank.

Aside from digitalizing, companies are also investing heavily in digital ventures in the country and in the region.

The Gokongwei’s JG Summit has also formed JG Digital Equity Ventures (JG DEV) to invest in startups that would augment JG Summit’s existing businesses.

It will also focus on technology platforms that will power future industries, including digital health, data and logistics.

The JG Group has made at least $40 million worth of investments in technology startups which includes SEA Ltd. (operator of wildly successful Garena and Shopee) and Oriente (digital lender operating in the Philippines, Indonesia, and Vietnam).

It aims to accelerate its initial success by earmarking an additional $50 million under JG DEV to invest in South East Asia.

While investing in startups, JG DEV will also build digital businesses in-house and enter into joint ventures that play off its Philippine ecosystem, which includes Cebu Pacific, Robinsons Retail, URC and Robinsons Land.

Lucio Tan’s Philippine National Bank is also pouring in around P2 billion this year for information technology related services to enhance the bank’s digital platform. This, officials said would complement the banks branch network.

There are also smaller initiatives taken by other groups but still the same journey toward digitalization.

The Consunji Group’s integrated energy company Semirara Mining & Power Corp. (SMPC), for instance, has partnered with Ayala-led Globe and GCash to transform Semirara Island into a “One Digital Community.”

Under this initiative, SMPC with Globe and GCash enables the people of Semirara to have digital access to online banking, e-commerce, remote medical consultation, digital lifestyle entertainment and cyber-wellness programs.

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