At the frontier of the job market

By JAN CORBETT

There are two compelling reasons why a story about the business gurus of the net generation should begin in Auckland's East Coast Bays. One, this is where one of the bright-young-things lives. Two, it provides a certain historic symbolism. East Coast Bays was settled largely by postwar migrants looking for land and opportunity in one of the few civilised places on Earth where some of both were still available.

Now, with a shrinking economy, no new countries to colonise and no sign of science fiction's promise of life in outer space, the post-Star Wars generation is instead rushing to make its fortune in the largely unexplored and poorly understood frontier we call cyberspace.

The Germans are calling these new prospectors "yetties" - young, entrepreneurial tech-based internet elite. And they are taking advantage of ever-cheaper technology to stake their claim on virtual territory, in the process redefining how we think about work and where jobs will come from.

Murrays Bay, home of Jenene Crossan, is a long way from the Hamburg Trend Bureau where social scientists first detected the yettie's footprints stomping through the New Economy. And it is doubtful whether this 22-year-old, who would blend easily with the North Shore babes who crowd the shopping malls on Saturdays, ponders her role in this socio-economic revolution or even thinks of herself as a yettie.

Yet Crossan's first year of operating an online magazine for teenage girls - nzgirl at www.nzgirl.co.nz - has been so successful that it supports 10 staff, is about to launch in Australia, and the Wellington-based merchant banker and infrastructure investor, Lloyd Morrison, has just bought 20 per cent of the company.

If Crossan had not spent most of her fifth-form year in bed with glandular fever, she might be graduating from university about now, so she is grateful to the virus.

The disruption to her schooling propelled her into the job market sooner than planned - "I've only ever sat two exams, my friends are envious of that," she says - and through a succession of computer-oriented and marketing-related jobs she absorbed the equivalent of several textbooks of theories on niche marketing.

But it was an item on TV One's morning business show last year that fired her and husband Grant Nicholl's imagination. The story about an American-based website called Planet Girl set them thinking about what publications were available for teenage girls in New Zealand, both on and offline.

Although she found teenage girls account for a significant portion of consumer spending power in New Zealand, she also found them poorly served by the media. At the time, and only moments before Creme magazine was launched, there were only two magazines aimed principally at teenage girls - Dolly and Girlfriend - and both are run out of Australia with only token New Zealand content.

Not only are New Zealand women subtly different in attitudes and tastes from their transtasman sisters, but the products and the prices in these magazines are mostly Australian.

So with $30,000 capital, nzgirl.co.nz was launched into cyberspace in December last year, the only purely online magazine in the Asia-Pacific. She runs it from a room off the hallway. Her staff - writers and designers - work from their homes, although they soon plan to join her in an enlarged room in the Murrays Bay house.

Not only does nzgirl run the obligatory teenage staples - advice on relationships, health, sex and careers, the latest fashion, makeup and celebrities - but is also acts like a giant chatroom for teenage girls. According to the slogan, it is "everything you'd want in a boyfriend - smart, good-looking, fun to be with and totally devoted to you."

An important part of the marketing has been developing close relationships with high schools, where teachers use the site as a useful introduction to the internet.

Crossan says the site attracts an average of 1000 new hits a day, putting it in the top 50 New Zealand sites in terms of traffic volume.

She takes full responsibility for selling the advertising. Although she claims cold calling is not her strength, she sells all the available space.

All up, she has put up to $300,000 into the business, and while she admits "that's not cheap," it is nothing like the cost of launching a print publication with its associated production, printing and distribution costs.

Crossan wasn't thinking so much of doing New Zealand teenagers a service by giving them their own online magazine, but of the service a website attracting teenage girls could provide to merchants trying to reach that lucrative market.

The research arm of the business is capable of gathering a considerable amount of valuable market information from its "readers" who enter competitions and answer questionnaires on the site. Crossan is about to join forces with a leading research company who can analyse that information.

Crossan says she can market-research teenage girls "in 1000th of the time" it takes traditional research companies. And companies selling to teenagers will pay for that information.

The added-value that can be mined from website visitors is also attractive to 24-year-old Wellingtonian Sam Morgan, who joined what he calls "the land-grab of internet space" just over a year ago when he set up trademe.co.nz - an online auction site for anything from secondhand televisions, cameras and musical instruments to cars, boats, clothing and, as an example, a pre-loved tickle-me Elmo (which went for $6.50).

The son of economist Gareth Morgan, Sam left university several credits short of an arts degree and spent two years as an IT consultant for Deloitte Touche Tohmatsu until the night he "had a few too many V drinks and couldn't sleep," and was hit by the inspiration for an online trading site modelled on similar overseas examples.

He started with virtually no capital. The major start-up costs were $15,000 to buy a server, and an advertising budget, because if no one knows your site exists there is no food on the table.

Attracting that critical mass of buyers and sellers is the most significant barrier to entering this market, says Morgan. "But once you've established a position, you're unassailable - as long as you continue to be competitive."

The site hosts from 7000 to 10,000 visitors daily, putting it in the top 10 in New Zealand for traffic volume. Anything from 2000 to 3000 auctions take place daily.

Morgan makes money from a commission on each sale and from selling advertising space on the site.

He is successful enough to have hired three staff and to be renting an office in central Wellington "with the obligatory pool tables and espresso machine." After six months of operation, IT consulting company AMR swung in as investors.

Like Jenene Crossan, Morgan plans to build a large community of traders to whom other goods and services can be promoted, at a price. Buyers hitting the site looking to buy a television, for instance, might be persuaded by slick advertising to forgo the secondhand option and buy a new one.

Sam Morgan has a business that he expects "to generate significant revenue off."

"I'm doing this because I think it's the way of the future," he says, adding that it has been an advantage that he knew nothing of life or business before the internet. As he points out, unlike those born ahead of him, he did not have to learn new skills: "This is where I've grown up."

So what does the appearance of the yettie really mean, and should we be afraid?

David Tippin, a research fellow in the Sociology Department at Auckland University who specialises in the impact of technological change, describes yetties like Crossan and Morgan as being at the forefront of "an emerging pattern of work we don't know a lot about."

But we are beginning to know the questions.

Will yetties form an abominable clique of precocious twentysomethings with considerable power gained from being the only ones who aren't afraid of the technology? Does it matter that they never cut their teeth in a traditional, hierarchical workplace with rules, conventions and etiquette to obey? Does it matter that they don't wear corporate suits and that they form their business and professional relationships electronically?

Those questions inform the entire debate about what the internet means for social cohesion, says Tippin.

He sees the yettie as the product of the cross-fertilisation between the young entrepreneur and the fluid workplace of the future which encourages individual, flexible contract workers over loyal longterm staff.

The new technology may allow the yetties to start businesses and employ staff now but, warns Tippin, "we don't know a great deal about how successful these jobs are long-term or whether they're merely short-term, keeping in mind the relatively high failure rate of entrepreneurs."

But yetties give no indication of being familiar with the "f" word.

Like their yuppie forebears, it is their supreme confidence which sets the yetties apart, says Dr Margo Buchanan-Oliver, a senior lecturer in e-commerce, who sees this new sub-species in her classes.

"What's interesting about them is that they're willing to explore any area. They'll say yes to any project and if they then find they don't have the necessary skills, they'll outsource it."

They are not afraid to experiment with new technology, knowing that unlike machinery which you risk breaking, computer mistakes can be easily undone.

One of Buchanan-Oliver's masters students is 22-year-old Camryn Brown, who grew up designing computer games for fun and is now running his own internet business, which he launched in March.

He started out just designing websites. "I enjoyed doing it, so thought I could make some spare cash, and it was a practical addition to my education."

According to his website - www.ridsel.com - his company is a one-stop shop providing a range of online market research, design and consulting services.

Working from home in Mt Eden, Brown will design the data-collection website, convert the data into knowledge and report the results in the way the client wants them. He will even provide strategic advice about what the research results mean.

Early clients have been a fellow student researching attitudes to smoking, and the University's Property Department, which needed to survey staff.

Because of his study commitments, Brown has to turn clients away, so he has no doubt his company is potentially profitable. Already this young entrepreneur is sponsoring his soccer team from company revenue.

But he doubts he will ever take on the burden of hiring staff, preferring, as the New Economy demands, to find subcontractors among his friends and classmates.

Which begs another question, according to Buchanan-Oliver. Who will be responsible for training staff in this new electronic economy? The twentysomethings who are running these businesses out of their bedrooms?

And if this is indeed the future of work, what happens to the technologically illiterate? Remember, the "e" in their acronym stands for elite.

"The most compelling thing for me in terms of Government policy is that unless we try to engage and provide access to this medium [for everyone] we will always have a section who is disadvantaged," says Buchanan-Oliver.


Links


nzgirl

Trademe

ridsel

Herald Online feature: The jobs challenge

We invite your responses to a series of questions such as: what key policies would make it easier for unemployed people to move into and generate jobs?