Over US$6m Contracts Signed As Targeted Expansion Into USA Gets UnderwaySydney, Sep 5, 2017 AEST (ABN Newswire) - Big Un Limited (ASX:BIG) (or 'the Company') is pleased to provide an update on operational and sales activity following targeted US expansion in Austin, Texas during Q3/Q4 FY17. The establishment of a sales centre in Austin, TX has resulted in the signing of US customer contracts with an Annual Contract Value (ACV) in excess of US$6m to date.
BIG Expansion Strategy
The Company began exploratory operations to build its video content library in the US in 2015 and is operational in New York, California and Texas. The early proof of concept phase has resulted in over 1,200 US businesses being filmed and BIG now owns approximately 20 terabytes of US content for its video content library. Over the last two financial quarters, the Company has expanded its sales operations in the US by establishing a 15 seat sales office in Austin, TX. This has resulted in a larger cost base over the last two quarters, although the Company is able to leverage our Australian production operations to deliver a higher profit margin. US income is now being generated and will be captured in FY18 reporting.
Following recent appraisal of US opportunities by the Company's executive team, further expansion of sales operations are planned for California and the US East Coast region.
BIG's global expansion strategy includes partnering with local, trusted aggregators to facilitate swift and cost effective market penetration. Negotiations with a number of significant US partners are ongoing and the Company anticipates providing further details to the market as these develop.
US Business Strategy & Three Pillar Application
Pillar One - Video Licensing Subscription
- 5.2 million US SMEs suitable for BIG packages
- Sales expansion planned to target key US states
- Negotiations on foot with US partners to target US SME space
Pillar Two - Video Content Curation & Monetisation
- Significant opportunity and demand for short form native video content e.g. Facebook
- BIG video library and ability to re-purpose and market content for US brand sponsorship
- Negotiations commenced with US partners to monetize video content
Pillar Three - Video Platform & App
- Significant US market opportunity for incentivized user generated reviews
- Negotiations underway with high profile US brand ambassadors to promote large volumes of BIG app downloads
- Significant market opportunity to monetise consumer analytics and Big Data
US Sales Strategy
The US sales team began offering high value video licensing packages to US customers in Q4 FY17. Unlike the Australian sales process, US customers are not incentivized to pay money upfront and are signed onto a SaaS monthly payment arrangement, thus making it easier to on-board customers and facilitating faster growth than that experienced in Australia. The Company has secured signed 12 month contracts valued at over US$6m to date. These US contracts are not discounted and the Company is actively in negotiations to secure US sponsorship options to further monetize the offer and increase cash flow.
Commenting on the US expansion plans and outlook, Richard Evertz CEO says, "The market opportunity in the US for BIG is exceptional. The Company has taken a considered and strategic approach to rolling out our business model with targeted expansion in the US market to ensure that expansion costs are carefully managed. We have established sales operations in Texas and plan further centers in California and the East Coast. The Company is currently in dialogue with a number of significant US partners and we will be providing further details as these negotiations develop. We look forward to BIG becoming a successful and recognised brand in the US market in 2018".
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About Big Un Ltd
Big Un Ltd (ASX:BIG) is the parent company of Big Review TV Ltd. Big Review TV is a social media, video review platform. BIG are innovative disruptors in the online video space delivering subscription based video technology products and services. The Company has operations across Australia and in New Zealand, the United Kingdom and the United States, Hong Kong, Singapore and Vancouver and was listed on the ASX in December 2014.
Big Un Ltd