Secrets to success of John Gokongwei, who brought air travel, bottled tea to the masses

Joel Guinto, ABS-CBN News

Posted at Nov 10 2019 05:58 AM | Updated as of Nov 10 2019 06:49 AM

Cebu Pacific CEO Lance Gokongwei (left) and his father John Gokongwei Jr. stand in front of a new Airbus A330-300 from Toulouse, France in a ceremony at Manila's International airport on Sept. 12, 2013. Jay Directo, AFP/file

MANILA—Six months before his death, billionaire John Gokongwei Jr.'s eponymous holding company earmarked another $50 million for its digital shift, reflecting the taipan's "never stop learning" approach to building one of the Philippines' largest business empires.

Before online marketplace Shopee hit it big with its 24-hour sale events, including one on Monday (11-11), JG Summit was among investors in its parent, SEA Limited. Its most recent venture, Cashalo, offers loans via mobile app.

Many of the virtual Christmas shoppers tapping on their phones on 11-11 most likely kept vigil during seat sales of Cebu Pacific, which made air travel cheaper and inspired travel lust among millennials.

"Never stop learning," Gokongwei said in a speech in his alma mater, the University of San Carlos in Cebu in October last year, among his last public speaking engagements.

No matter if he earned just P20 a day, said Gokongwei, who in is teens, sold threads, soap and candles to help his mother after his father died.

"I really loved my work. I loved being an entrepreneur."

"I always tell my children, my grandchildren, and my colleagues: Love your work. Work hard for it. Love your family. Love your country. Never stop learning. And always look back and be grateful to where you came from," he said.

FROM CORNSTARCH TO JUMBO JETS

A cornstarch plant he started in 1957 became the seed for Universal Robina, the food company that helped define snacking for Filipinos with brands like Chippy and Nova. Universal Robina also brought bottled teas to the mainstream with C2, which challenges sodas as consumers' sweetened beverage of choice.

Beyond the Philippines, Universal Robina acquired New Zealand's Griffin's in 2014 and Australia's second largest salty snacks maker, Snackbrands, in 2016 for AUD 600 million (P21.4 billion).

Chippy, C2 and Nissin Cup Noodles are on offer aboard Cebu Pacific, the Philippines' pioneer budget airline which eventually rose to be its biggest. The carrier named after Gokongwei's home province aims to fly its 300 millionth passenger by 2020. During a sale last March, 20 million Filipinos participated in just one day.

Gokongwei's only son, Lance, said his father got the idea for Cebu Pacific in the late 1980s after flying Southwest Airlines in the US. At that time, the government of then president Corazon Aquino was liberalizing air travel. The Gokongweis also lost in their bid for Philippine Airlines.

"We lost the bid for PAL. My dad felt he wanted to put up a competitor to PAL. He was in the States and read about a low cost carrier, called Southwest and that's how it started," the young Gokongwei said in a 2013 interview.

Cebu Pacific recently finalized an order of 16 Airbus A330neo jets worth $4.8 billion (P242.4 billion). With an average age of 5 years, its fleet is among the world's youngest.

RETAIL KING

Robinsons has 51 shopping malls around the country, second to SM of Gokongwei's fellow tycoon, Henry Sy, who died in early 2019. Its flagship, Robinsons Galleria, got a major renovation heralded by a viral ad that poked fun at an urban legend.

Released on Halloween 2018, it starred actress Alice Dixson, who was allegedly swallowed by a snake, the supposed twin of one of Gokongwei's daughters in the mall's dressing room.

"The netizens have spoken and they experienced the real Galleria through this ad," said Kaths Laudit-Chong, who conceptualized the Facebook ad that easily got 1.2 million views.

Robinsons Galleria and Place malls are the centerpiece of townships that also include GoHotels and Summit Hotels and Cybergate offices that house BPO companies.

The retail arm of the Gokongwei's also includes Mini Stop convenience stores and most recently, Rustan's Supercenters Inc.

WITHOUT FEAR

While not as successful as Cebu Pacific, Gokongwei also bet on telecommunications, challenging PLDT Inc with Digitel and Sun Cellular. PLDT eventually took majority control of Digitel in 2011.

"That's my father, he's a classic entrepreneur, someone without fear. I don't know, he doesn't consider the largeness of the competitor as an obstacle but rather as an opportunity," Lance said.

"It may seem he's doing things on the fly but there's a careful study before it's done. He says you have to do three to four things. First, you have to assess the market. Second, is it large enough? Is there growth in the market? Third, do we have the capital to compete and fourth, do we have management and technical expertise to compete?," he said.

When he turned 80 in 2006, Gokongwei donated P20 billion — or half of his shares in the JG Summit Holdings — to the family foundation. In early 2019, Universal Robina said it was opening Baker John, a baking school which aims to inspire entrepreneurs.

Lance is president and CEO of JG Summit, where the patriarch's brother, James Go, sits as chairman and COO. Lance is also CEO Cebu Pacific. His sisters, Robina Gokongwei-Pe is CEO of Robinsons Retail, while Lisa Gokongwei-Cheng is president of Summit Media.

In the 2013 interview, Lance was asked how he compared to his father, also called "Big John." The younger Gokongwei said: "You can never beat the original. My job is to make sure the company is run well and continues all the success that he's built."