High Tech Features: "We'll Be the Number 1 Entry Portal for Online Shopping"
By Moran Bar Kochva

From Israel's Business Arena - Globes

Aug 7, 2000
DealTime is arousing so much interest, not because of its dot.com name, but because its advanced technology and applications may yet revolutionize the real economy. Economics classes teach full-information models in which the prices of goods don't fall to the intersection of supply and demand, but beneath it, to a price equaling the marginal cost of producing a single product. Now the Internet is providing us with an apprpriate answer: comparison sites, that can be defined as strong search engines to seek out the best possible deal - i.e. the cheapest. Accessible full information, every consumer's dream. However, DealTime is striving to be even more than a strong search engine. This company want to be the center of life for online buyers and sellers. The sellers will offer their wares; the buyers will examine them via DealTime. If necessary, the deal can be sealed on the site itself. However, the Internet is not the only channel through which DealTime is delivering its message of a new shopping gospel to millions of believers in the world of consumerism. Every mobile platform, such as a cellular phone, can be used to transmit the message of a good deal.

"Globes": What is the connection between MasterCard and DealTime?

DealTime general manager Dan Ciporin : "I got this job thanks to my experience as vice president of MasterCard, where I became aware of the growing e-commerce market. Credit cards already mediate between buyers and sellers, and Dealtime is the perfect mediator of the Internet. Due to my job at MasterCard, many headhunters called me to try to convince me to join this or that dot.com company. Not one of the offers looked like a normal business model, so I rejected them out of hand. I wasn't sure I wanted to manage Dealtime until I met company founder, Dr. Nahum Scharfman. He got me excited and made me see where the company could go."

What deterred you from accepting DealTime's offer at first, and what changed since then?

"I wanted to know what this company does. So, one evening, I accessed the website, and simply did not understand a thing. It looked like a site designed by some computer engineer. The next day, I told the headhunter that I was not interested, but he convinced me to spend 30 minutes with Nahum. The conversation lasted much longer than planned. There was a chemistry between us. I listened and became enthusiastic."

From what? What did DealTime's website do?

"As I said, Dealtime is the perfect mediator between online buyers and sellers. It was, essentially, an e-commerce gateway.

What is all the ballyhoo around Dealtime? You submitted a prospectus at the end of March, but your issue has been frozen ever since. Since then, many Israeli companies have gone public.

"We are operating according to plan, and there is no problem with our issue. The latest delay was due to changes we had to put into our registration documents following our partnership with Bertelsmann. We will issue as soon as the revisions are made and approved by the SEC. I cannot disclose the precise date."

What is the significance of the Bertelsmann deal?

"I think that Bertelsmann saw in the company the same promise I did. Bertelsmann controls the website DealPilot, which compares between books, music and films. However, they realized that these categories are very limited in terms of sales, and they decided to invest in a larger comparison website, and so came to us. Bertelsmann entered the DealTime Europe investment with 49% ownership, compared to our 51%. In other words, we retain control. This investment also altered the holdings in the parent company."

Why are you opening a website in Japan?

"Our slogan is that to have global e-commerce, you must first have local networking. We therefore entered partnerships in Japan. We have 54% ownership. The other investors are JAFCO, the credit card company OMRON and the communications company NTT, which invested a combined $10 million." What is the difference between you and other comparison shopping websites like BottomDollar.com and mySimon.com?

"It is very easy to write a search engine. The problem is to sift and absorb the information and to transmit it the clearest and fastest manner to the consumer. Five or six times a day, the system scans every commercial website, updating the figures. This is an enormous advantage, especially for mobile platforms, where consumer tolerance is very low. We have several interesting partnerships in this field. We will be the home shopping site for AT&T; and Sprint. We think there is incredible potential in the cellular field."

How will DealTime affect shopping?

"When you enter our website and see that the price offered for a product is much lower than the one offered in the store, you face two options: show our price to the store and bargain with him, or buy the goods online via mobile phone. In addition, thanks to location software for cellular phones, you can approach the store or chain whose offer best suits you.

Following conversations with B2C managers, it seems they fear comparison websites like DealTime. Can we expect a intellectual property war between you and the sellers who will try to prevent you releasing information from their websites?

We have never had such a problem. We have had situations where sellers told us that they did not want us looking at their websites, but that was a year ago. Today, sellers want us to access their websites. It reminds me of the long ago days with the credit card companies, when sellers asked me why they should pay us a premium for every sale they made. Today, all sellers have credit card company machines. In my opinion, a similar process is underway on the Internet, and everyone will want to go online with us."

How will you build DealTime as the leading Internet brand name?

"At the basic level, it is sufficient to unceasingly improve the website, so more and more people access it. We see that as the site improves and become accessible to more surfers, the number of people accessing us and of repeat customers grows proportionally. We are launching an advertising campaign, both online and off-line. We will shortly invest most of our resources on online ad campaigns, but the most effective advertising medium is by word of mouth.

"As for Internet exposure, our situation is excellent. According to PC DATA, we are the 93rd most visited website globally, and the 13th most popular online shopping site. There is no lack of awareness about us. In fact, we have already been infected by a virus. At the end of September, we will launch our improved website, in order to exploit the sales peak and to position ourselves as the leading comparison shopping website. In the end, we are sure that we will be the number one online shopping gateway."

Published by Israel's Business Arena on 7 August 2000

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