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After Facebook Messenger opened its platform to chatbots in 2016, it became the era of chatbots — more than 12,000 of them were deployed on Messenger by the end of that year. One year later, the number has risen to 100,000.

Despite rising popularity of chatbots around the world, they didn’t take off as expected in Southeast Asia given the region’s affinity for texting through messaging apps. This was especially true in the region’s biggest market, Indonesia.

Talent remains one of the biggest hurdles for AI or any other type of tech development in Indonesia, however, it is the inconsistency of the Indonesian language that presents an even greater challenge in developing the Natural Language Processing (NLP), that powers the chatbot.

According to Irzan Raditya, co-founder and CEO of Kata.ai, an Indonesian B2B chatbot service provider that raised $3.5 million last year, more industry partnerships could be a solution to these challenges.

“We need more collaboration between the service providers, API providers, and more local developers studying AI,” says Raditya. “Without the human resource, it will be impossible to make this technology a reality.”

Launched in October 2016, Kata.ai actually evolved from a free text-based personal concierge service called YesBoss that recorded over 100,000 users at peak.

Before the startup’s pivot, the company struggled to keep up with customer demand and chose to move to a more sustainable business model by targeting a new segment – B2B.

ecommerceIQ speaks with Raditya to understand chatbots, his thoughts on its most promising applications and how his turbulent experience with YesBoss helped build Kata.ai to its present state.

Learning the ropes

Right from the start, the four founders of YesBoss were realistic about their venture.

“We understood that it wouldn’t be scalable (to provide a concierge service) without AI,” admits Raditya.

“And in order to build the algorithms, you need data and we collected tons of data from YesBoss.”

“We learned how to make people’s lives easier through conversations gleaned from our concierge service answering different kinds of customer requests, be it booking a plane ticket or shopping online. Along the way, we learned we wanted a business that was more impactful and scalable.”

With the man-power heavy B2C service provided by YesBoss no longer active, Raditya saw an emerging opportunity in the chatbot space in Indonesia.

Sitting on a bank of data, Kata.ai became the first chatbot provider in the local Indonesian language.

“By studying all the texts in Indonesian from YesBoss — the uniqueness of abbreviations, the slang, and complexity of certain phrases — we did the dirty work and spent over a year researching machine learning to build a comprehensive algorithm compatible with the needs of the Indonesian language NLP,” says Raditya.

Now equipped with a chatbot able to understand the local language, what was the team going to do with it?

Serving the enterprises

As a conversational AI platform targeted at enterprises, Kata.ai develops a chatbot for companies to easily handle incoming customer requests and facilitate ecommerce in Indonesia.

One of the brands that has developed a chatbot with the company is Unilever.

Using a female persona named Jemma, the chatbot on LINE acts as a virtual assistant that liaises with customers on behalf of Unilever where customers can chat about everyday things including entertainment news and/or ask for beauty recommendations.

Raditya says the chatbot is popular among female customers who like to ask for relationship and fashion tips.

“As of now, Jemma has befriended over 2 million users on LINE and recorded over 200 million conversations to date within a span of one year since its launch,” says Raditya. “The longest chat session actually lasted for four hours.”

Veronika is chatbot created by Kata.ai for Indonesia’s biggest telco company Telkomsel.

Another chatbot that Kata.ai helped build is Veronica, the legendary brand persona of Indonesia’s biggest telecommunications provider, Telkomsel.

By texting with Veronica on LINE, Facebook Messenger, and Telegram, customers can access product information, Telkomsel’s latest promotions, a live customer agent, as well as facilitate transactions such as phone credit top ups, buy data packages, make bill payments and reserve appointments with the company’s nearest offline customer service center.

Envisioning a platform for all

If the company’s enterprise solution provides brands with tailored chatbots, Kata’s newest venture released last month, Kata Bot Platform, hopes to provide developers with a enterprise-grade framework to help them create chatbots and reduce costs on tech development and research.

“By releasing our platform to the public, we want to solve the ecosystem problem. A lot of Indonesian developers aspire to incorporate chatbots into their businesses but face the daunting task of building it from the scratch because there’s almost no platform that caters to the Indonesian language,” says Raditya. “Kata.ai provides the infrastructure so they can focus on building a good customer experience for the business.”

NLS, one of the features available on Kata Bot Platform

He also encourages all businesses to use the platform as it can accommodate up to one billion messages and isn’t restricted to only startups.

Do chatbots live up to the hype?

“We believe improving the technology of chatbots is important to capture an opportunity that exists in Indonesia’s strong chat culture and major shift in the interaction between people and technology.”

This shift, according to Raditya, will see people utilizing less apps as it impedes the customer experience; from installing the app, registering for the service, learning how to use it, constantly having to update to new versions, etc.

Chatbots, on the other hand, provide a more efficient way for users to interact with the service provider without having to familiarize themselves with a new interface as most Indonesians already know how to use popular messaging apps.

“Chat is the new standard of user interface.”

The CEO himself has a favorite AI-powered personal assistant service he uses to save time from shuffling through email chains based in Singapore called Evie.ai.

“Engaging and intelligent chatbots allow businesses to turn these channels from information centers to profit centers, as shown with the case of Telkomsel. They can now monetize an audience of over 10 million connected to their social channels by selling data packages — something that they were unable to offer before,” shares Raditya.

“If you take a look at consumer technology, changes are usually predicted in ten year cycles. The dotcom boom in 1997 changed the way people conducted business with websites. In 2007, Apple changed the landscape with the launch of the iPhone and app store,” explains Raditya. “During these periods, we saw companies coming out as winners carrying high valuation and delivering high impact to the economy.”

“Indonesia is always left behind.”

“With analysts predicting AI to become the one the driving consumer technology on 2017 onwards, Kata.ai can spearhead the wave of incoming local entrepreneurs by being the breeding ground for a new generation of botpreneurs,” says Raditya.

His “big picture” approach was sparked during the Microsoft Accelerator program in Bangalore last year, in which all founders participated. The program provided 14 B2B startups with Microsoft’s resources and network to help accelerate their growth and Kata.ai was a finalist out of 1,500 applicants.

Kata’s founding team. (L-R) Wahyu Wrehasnaya (CFO), Reynir Fauzan (CMO), Irzan Raditya (CEO), Ahmad Rizqi Meydiarso (CTO).

“We learned to see things from right to left, which meant focusing on the goal first and working backwards to the process in order to achieve it,” says Raditya. “Another thing we learned is how to sustain innovation by being the Category Creator, Category Sustainer, and eventually the Category Destroyer.”

“The program also gave us experience with the technical side of things, such as how to scale our infrastructure effectively to serve millions of customers.”

Although the company’s focus is currently on Indonesia, Raditya isn’t counting out expansion to other countries.

“Right now, we’re focusing on building chatbot technology that can offer customers a next level of service that is personalized using historical data,” closes Raditya. “But who knows, in one or two years, I think voice could be an interesting medium as well.”

As the fastest growing industry in one of the world’s fastest growing markets, the evolution of Southeast Asia’s ecommerce landscape means new players and a lot of consolidation since last year’s first ECOMScape series by ecommerceIQ.

This year’s new edition of the ECOMScapes kicks off with Indonesia.

Expected to capture the biggest chunk of the $200 billion ecommerce opportunity in Southeast Asia, it’s easy to see why Chinese giants like Alibaba, JD, and Tencent have rigorously left their home-market to tackle Indonesia. What has happened over a span of only one year?

1. Chinese Companies are Hungry

Out of the total $3 billion investment put into Indonesia startups in the first eight months of 2017, 94% of the funding came from Chinese investors.

News regarding Alibaba leading a $1.1 billion investment in Tokopedia created excitement in the industry, especially because JD was rumored to also make a bid for the popular local marketplace.

Indonesia startups investment

Although that opportunity passed, it hasn’t stopped JD from participating in the funding round of Indonesia’s two other unicorns, ride-hailing app Go-Jek and online travel booking platform Traveloka. Chinese giant Tencent also joined the round for Go-Jek.

2. Natural Selection: A Race to the Bottom

As the market in Indonesia saturates, in both players and investment, it’s only a matter of time before natural selection weeds out the weaker companies (especially those with shallow pockets).

The past year has seen several ecommerce companies in Indonesia either shutting down or pivoting business models, and investors pulling out before stakes become worthless. And don’t think it’s only happening to the small fish.

Some cases? Alfacart and Elevenia.

Earlier this year, Indonesian convenience store chain Alfacart announced its decision to ditch the marketplace model after a continual lag behind e-marketplaces like Lazada and MatahariMall.

Launched in 2013, Elevenia is the joint venture of telco companies XL Axiata and Korea’s SK Planet. Despite claims that Elevenia has seen positive growth over the years, it’s a telling sign when both companies pull out and sell their stake to Indonesia’s conglomerate group Salim.

Even the ecommerce arm of large telco company Indosat, Cipika, shut down in June citing unprofitable business model and high cash burn rate as reasons.

Indonesia ecommerce landscape

With JD and Alibaba investing directly in local companies, it’s not a stretch to expect fewer names on the ECOMScape next year.

3. Marketplace Competition Heats Up

If this time last year Tokopedia was focused on growing its core C2C business, the Indonesian marketplace has long since been strong arming its shift to B2C as signaled by Unilever’s official store opening on the platform.

The move is already serious competition to Lazada, especially as the two ecommerce companies interchangeably grab the top spot in web traffic in Indonesia (which is probably why Alibaba invested in both companies).

Indonesia’s top C2C players have been moving into the B2C space i.e. Tokopedia. Traffic of ecommerce websites compiled by ecommerceIQ. Find more here.

Sea’s backed Shopee has also opened its platform for brands as it launched Shopee Mall that claimed to offer over 500 brands.

The shift from C2C to B2C is a natural progression as companies attempt to increase revenue and leverage their already large customer bases.

4. Having Fintech is for “Cool Kids” But the Nerds Will Win

While payments still remain a pain point in Indonesia ecommerce even though multiple companies released their own e-wallets last year, the country and the region potentially, might finally have a real solution.

Both Kudo and Kioson are arming micro-entrepreneurs and business owners such as mom-and-pop shops in rural areas with their digital platform to empower them to act as the bridge between ecommerce companies and rural citizens.

The O2O (online-to-offline) concept clearly has some merit, as both companies attracted investor attention and made headlines in 2017. Kudo was acquired by Grab and Kioson raised $3.3 million as the first tech company to IPO on the Indonesia Stock Exchange (IDX).

Kioson during its IPO in October 5, raising $3.3 million. Source: Kioson.

Indonesian startup darling Go-Jek is also leveraging its millions of users by launching its own mobile wallet, GoPay, which has real potential to become the WeChat of Indonesia.

GoPay’s usability has improved from payment for rides to also allowing peer-to-peer (P2P) transfers and making the order of food, groceries, tickets, and beauty treatments extremely easy in one app.


Are we missing any key players? Let us know via Linkedin | Facebook | Twitter

Download ECOMScape Indonesia 2017 here.

Featured image credit: Martha Suherman
Deliveree logistics marketplace

Deliveree’s Group CEO Tom Kim and Group Head of New Product Nat Atichartakarn at Deliveree’s Jakarta HQ

The current state of logistics in Southeast Asia is often bemoaned as one of the main challenges holding the region back from its full economic development.

Alibaba founder and chairman Jack Ma remarked that with Indonesia’s geographical state, a comprehensive logistics network is needed to stimulate growth.

His assessment is also applicable to other emerging markets across the region.

But these types of infrastructural projects in the Philippines, Thailand or Vietnam is not an easy, and certainly not, cheap feat. Here are a few examples of current plans in the works:

  • World Bank estimates $500 billion is needed in Indonesia over the next five years to bridge the infrastructure gap
  • President of the Philippines, Rodrigo Duterte, proposed a $161 billion six year plan to improve railways and ports to connect the archipelago’s islands
  • Thailand’s government has also started 20 infrastructure projects worth $50.2 billion to improve the country’s current rail lines

This regional bottleneck has opened opportunities for startups to figure out the cheapest and quickest way to get a package from point A to point B.

Companies solving last-mile headaches for ecommerce companies have attracted a lot of investor money like Lalamove and NinjaVan with $100 million and $30 million funding rounds, respectively.

But a logistics technology company that recently raised $14.5 million is looking to tackle another problem.

“We’re interested in solving bigger, bulkier problems that sit further upstream from your last mile delivery challenges,” explained Tom Kim, Group CEO of Deliveree. “With marketplace technology, we want to fundamentally challenge the way companies approach first and mid-mile bulk logistics.”

Deliveree logistics marketplace

ecommerceIQ speaks with Tom and the Group Head of New Product, Nattapak Atichartakarn, to discover how the logistics company found success in Southeast Asia by helping businesses reduce costs for first and “mid-mile” goods transport and what they plan to do with the recent Series A injection from Gobi Partners.

Logistics but focus is on technology

Through the Deliveree mobile app and web marketplace, customers have access to screened qualified drivers of commercial vehicles to move their merchandise and/or cargo.

The company’s new marketplace model houses 15,000 commercial vehicles consisting of cargo vans, pickups trucks, small-large box trucks, as well as economy vehicles such as MPVs and hatchbacks on its platform — covering three metro cities in Southeast Asia; Bangkok, Jakarta, and Manila (the company operates under “Transportify” due to a trademark issue in the Philippines).

Having started with serving end-customers, the company realized in order to grow its business, it had to focus on serving corporate clients.

“The bread and butter of our business is goods, merchandise, and cargo — bulk movement from outer provinces to warehouses in the cities, factories to distribution centers, and distribution centers to retail stores, or what we call modern trade,” explains Nat.

Now, nearing the end of its third year of operations, the company says it is close to financial break-even in its core markets. Nat credits this success to the quality of technology and drivers that Deliveree provides.

The company’s tech team of 30 developers in Vietnam is responsible for building, managing, expanding, and innovating the company’s marketplace tech capabilities and solutions that focuses on businesses needs:

  • Batch booking toolsets for high volume customers
  • Flexible booking scheduling from immediate to two weeks in advance
  • Drop off package at multiple destinations up 10 locations
  • Real-time tracking of driver and package location
  • In-app chat between customers, drivers, and customer support
  • Cash on Delivery and original document return services
  • Contract logistics option for businesses that need dedicated resources
  • Full commercial insurance

In addition to targeting SMEs, Deliveree also partners with transportation and logistics companies without their own technologies to connect them to new customers on its platform.

“People think these big logistics companies own their whole logistics network, when in fact, many don’t. A lot of them outsource ground transportation elements of the business and they use us as a provider of ground transportation for bulk goods and cargo so we address the gap and needs of the industry,” says Tom.

Capitalizing on quality

Deliveree logistics marketplace

The company takes pride in the high quality of its drivers, achieved by imposing a high standardized screening process, something Tom doesn’t skimp on.

It’s easier to get into most colleges than to get into our driver pool.

“We only invite a third of the driver applicants to training — it’s less than the acceptance rate at the most universities,” says Tom.

Calling it the “best trained fleet on the market”, every single driver must endure six hours of in-class training, which includes customer etiquette, and pass a 50 question final exam with 80% score or higher.

The company also enforces additional training for drivers with low satisfaction scores and regularly do real-time quality checks with a mystery shopper.

While not the most scalable process, Nat says it’s a price the company’s willing to pay.

Growth without quality is more of a step backward for us.

With such high investment in human resources, is the company worried about “leakage” – the shift of user-driver relations moving off the platform?

“There will always be a case or two of customers trying to work with our partners directly, but most of them end up coming back to our platform. Why? Because one of the reasons they come to us in the first place is they don’t want to, or can’t, manage this specific part of the business,” said Tom.

“And with the added value we provide for them, I don’t see why businesses would want to even bother.”

Ride-hailing apps aren’t built for cargo

With the heated war between ride-hailing companies in the region, parcel delivery is one of the added value services that is being offered by Uber and Grab to capture a wider clientele.

But Deliveree isn’t worried.

“These ride-hailing companies have always been doing logistics but they haven’t been doing it right,” said Tom.

According to Deliveree, the services provided are not comparable as the requirements for logistics is radically different than the passenger business.

“If you’re looking at the value of delivery bookings in Uber and Grab, it’s probably not more than a few dollars. Our average booking value is more than 10 times the amount and at the same time, our resources and costs to support each booking are higher than what a passenger app would expend per booking,” said Tom.

Tom also pointed out the security risks highlighted by a recent ruling in the Philippines by the country’s Land Transportation Franchising and Regulatory Board (LTFRB) that banned any package delivery through ride-hailing apps accompanied without a passenger. The reason? Drug-trafficking concerns.

“Trust me, it won’t only be the Philippines that will apply this rule,” commented Tom.

Small ecommerce pie for Deliveree

With the current state of ecommerce in Southeast Asia where fashion still tops all categories in popularity and ordering large items like bicycles or washing machines is still uncommon, the pie for Deliveree’s business is not that big.

“Ecommerce is primarily a business comprised of small things, and we don’t move small things — we move big things,” says Tom.

But Tom believes the company will eventually grab their share of Southeast Asia’s ecommerce pie.

“Our company is not closely aligned with the ecommerce industry today because the items that people buy are still small parcels and it isn’t our specialty because of the challenging economic units,” said Tom. “Ordering anything and everything online is an evolution that will probably happen in the next over ten years or so.”

“This is when we (Deliveree) will likely play a much bigger role in the ecommerce value chain.”

Growing its current markets

With new funding from its Series A round, Deliveree is exploring some interesting growth plans.

The company hasn’t ruled out M&A to grow the business in key markets and although expansion to new cities and countries are in the cards, Nat said that Deliveree is more interested in growing the cities where it is currently operating at the moment.

Deliveree logistics marketplace

“Imagine if Asus, Lenovo, and Acer compete with each other in the tablet market in Jakarta,” said Tom. “When the sales start, there’s a limit to how far the competitors can go because they have inflated costs the further the consumers. If we can bring down the cost base and give them more margin latitude, the competitive playing field will force some of those savings into discounts, sales, promos, even lower everyday pricing and ultimately the consumer wins.”

Deliveree logistics marketplace

“These are the kind of big problems we love to be involved in solving,” concludes Nat.

Bangkok’s internationally recognized ‘foodie culture’ has given rise to a steady rotation of up and coming international eateries, attracting lines of customers and naturally, the birth of food ecommerce startups vying for their attention.

Hungry Hub is one of them.

The company started as a restaurant reservation app in 2014 after anticipating a boom in restaurant bookings in Bangkok as the city was experiencing a surge in demand for eateries and dine out venues. Founder Surasit Sachdev wanted the app to be the “OpenTable” of Bangkok.

Fast forward two years later, traction for the app never picked up because customers weren’t incentivized to book through the app and the restaurants were never fully booked to need a reservation. The result left Surasit with two choices: pivot or shut down completely.

Hungry Hub lived on, but first needed to become lean. 15 employees were cut down to a team of five and the company decided there was a future in bookings for larger parties like corporate dinners, anniversary celebrations or other social functions.

The realization came to Surasit when he took his team out for meals and there was no way to balance price point and allowing his employees to order freely. How could he come up with a way for price sensitive companies like startups to enjoy corporate meals without breaking the bank?

The “all you can eat” package

Many mid-tier restaurants in Bangkok require a customer to spend an average of 300-500 THB per meal, usually comprising of an appetizer and a main dish; this excludes drinks and a service charge.

With Hungry Hub’s ‘all you can eat’ package, each customer would be charged a fixed fee of 599 THB to eat a variety of mains, appetizers, drinks and desserts from the menu depending on sets curated by the restaurant.

Hungry Hub focuses on mid-tier restaurants like Audrey Café and popular Japanese ramen chain Ippudo who have already partnered with Hungry Hub to offer the ‘all you can eat’ package. There are currently 33 restaurants signed onto the platform.

To get these offers, reservations need to be made at least 30 minutes in advance, and about a week for corporate gatherings.

Since the shift to B2B, Hungry Hub has seen 30-40% growth in revenue.

“Several large corporates have recently approached us and asked if we could find them a restaurant that could fit 300+ people,” says Surasit. “That’s when we realized there’s a demand.”

Unlike other businesses, the company is growing its business based on profits, rather than spending upfront to achieve sustainable growth. Currently, Hungry Hub has not raised funding for its business till date, but plan to do so in the near future for expansion.

The demand for more B2B services

Although Bangkok’s restaurant booking landscape is filled with active, high profile ‘food’ players such as restaurant reservation platform Eatigo and Thai restaurant directory and delivery platform Wongnai, Hungry Hub is developing a niche of its own by establishing the company as the go-to platform for B2B dining and catering to large groups of friends and families.

“The good thing about the food industry is that it’s an everyday thing. Users do not have to exclusively stick to using Hungry Hub or Eatigo,” says Surasit. ‘Their dine-out needs are always changing.”

“We want to become the name companies think of when they need to find a restaurant for a company party or dinner for 10-100 people,” continues Surasit. “We’ve built a large restaurant database that can accommodate these needs that no one else is doing.”

Hungry Hub is focusing on the development of its website over its mobile app because the company finds conversions are better on desktop. Companies browsing for suitable bookings are most likely doing so on computers than on a mobile phone.

What’s in the future for Hungry Hub?

Hungry Hub will spend the next six months solidifying its B2B play by adding more user benefits on top of the current 20 THB credit back with every booking – cashback can be requested after a minimum of five reservations.

Future benefits to look forward to include two for one booking and loyalty rewards.

When asked about the future of Bangkok’s restaurant landscape, Surasit expresses his concern for the oversupply of restaurants.

“There seems to be a new restaurant opening every week, and people try it once or twice then never return. The lack of loyalty has caused many places in the city to go out of business.”

So how is Hungry Hub trying to help these restaurants?

By cutting out discounts and providing restaurants a more reliable solution through group bookings.

“We want to bring sustainable offers to independent restaurants rather than cutting their heads off with half-price deals,” says Surasit. “The future of food ecommerce is not in massive discounts.”

 

 

When talking about the potential of ecommerce, the real opportunity isn’t in the saturated B2C sector, but it’s almost hidden in B2B.

The sector is pegged to grow more than twice as much as B2C globally by 2020 and expected to generate $6.7 trillion of revenue but in most Southeast Asian markets, it doesn’t nearly get as much as attention.

The ECOMScape series shows only a few players have dabbled in B2B and in Indonesia, one of them is Ralali, the country’s first B2B ecommerce marketplace, founded in 2013 by current CEO, Joseph Aditya.

The company’s beginning

Launched at a time when most existing websites were catalogs, Ralali generated IDR 10 billion or $750,000 in revenue during its first six months selling industrial supplies to manufacturers, contractors, and automotive businesses.

Ralali B2

The company’s early robust growth attracted the attention of investors and in May 2014, Ralali bagged an undisclosed amount of seed funding from East Ventures and raised another $2.5 million from Beenos Plaza and Cyber Agent Ventures a year later in June 2015.

With financial backing in hand, Ralali was set to expand its business further but the company, once specialised in MRO (Maintenance, Repair, and Operational) products and office supplies, soon found that the current business model was not scalable.

“There is simply not enough reason for big companies to completely shift their procurement process online. And the problem with having big companies as a main source source of revenue is that it’s a huge risk if one decides to go elsewhere,” explains Aditya.

Ralali decided to change its strategy to be able to scale up at the rate they wanted to.

Reaching an untapped source

While assessing the pool of potential customers, they found a glaring source of untapped potential in Indonesia — small and medium enterprises (SMEs).

In Indonesia, the latest data shows that out of all the country’s registered businesses, big enterprises only make up less than 1%. The rest – or almost 58 million companies – are SMEs and they contribute 58.92% of total GDP.

The government has also expressed its support through digitalization.

The problem, however, was and is that most of these businesses are still stuck offline – only 9% have dabbled in ecommerce and only 37% have basic online capabilities.

But this wasn’t the only reason Aditya shifted his focus to SMEs, he also wanted to help even out the playing field.

“As a tech company, we are working to make life simpler and to empower more people to become efficient. Targeting the big corporations with their already vast and readily available resources, is not gonna make much impact to their business. It’s unlike the impact we could make with SMEs,” says Aditya.

With this in mind, Ralali shifted its focus to cater to SMEs and began making the adjustments needed to achieve this goal.

Business starts here

To attract more SMEs, Ralali began introducing new features like the RFQ (Request for Quotation) and included more categories on their website by expanding its SKUs. As of today, there are more than 200,000 SKUs listed under 61 sub-categories in 12 categories available on Ralali, from Machinery & Industrial Parts to Food & Beverage.

“When you’re a big company, vendors are practically queueing outside your office to get your business and you have the pick of the lot. SMEs rarely have any bargaining power,” commented Aditya.

The RFQ feature allows SMEs to select from a variety of offers made from vendors on the Ralali platform so they can find the best option for their business needs. It also helps Ralali determine what customers want in order to optimize its product selection.

Facilitating SMEs to further their business

To become the supplier choice for SMEs, Ralali changed its model to a wholesale marketplace allowing other suppliers to offer bulk purchases on its platform with tier pricing.

Ralali B2B SMEs

Right now, there are more than 3,200 suppliers registered on the platform. The company is continually scouting for sellers through offline activities with various business associations and communities geared towards educating SMEs about the benefits of digitizing.

Ralali facilitated annual transactions are worth more than $150 million or IDR 200 billion, with a basket size per transaction ranging around $1,500-2,000.

Despite focusing on SMEs, big corporations make up for 3-5% of customers for the marketplace.

Empowering the SMEs ecosystem

Not only is the company selling to small, medium sized businesses, it is also providing the skills and knowledge needed to take the first steps online.

The company recently signed a partnership with the Jakarta Cooperatives, Micro, Small, and Medium Enterprise and Trade Agency to help its members expand their businesses online.

Under the partnership, Ralali will provide training and assistance to the SMEs for one full year. Aditya says a team of Ralali consultants are going to share insights on the workings of an online marketplace and how to set up a business on the platform.

“By doing this training, we hope to help these smaller businesses increase their transactions online. Ralali wants to be the platform that connects businesses from Indonesia to all over the world,” shared Aditya.

Ralali B2B SMEs

founder Joseph Aditya (second from right) with the representative from the Jakarta Cooperatives, Micro, Small, and Medium Enterprise and Trade Agency

Here’s what you should know before starting the week.

1. Japan eyes cooperation with ASEAN to improve ecommerce

In an effort to spur progress in negotiations for the Free Trade Agreement in wider Asia region, Japan is eyeing cooperation with the Associations of Southeast Asia Nations (ASEAN) by proposing a plan to improve ecommerce and customs procedures.

The plan will primarily focus on supporting the bloc’s small and midsize businesses, which are seen as holding the key to ASEAN’s economic growth. Many of the businesses are selling their products online without having their own logistics networks. 

Japan offered to introduce delivery methods pioneered by Japanese companies and have personnel share their know-how on improving efficiency. This delivery system is hoped to be more efficient and allow the businesses to cut costs.

Read the rest of the story here.

2. Indonesia’s conglomerate, Salim Group, joins B2B ecommerce space

Salim Group has recently established its B2B ecommerce platform, IDMarco, reported DealStreetAsia. The platform is currently still on the trial basis and focussing on small and traditional stores, hotels, restaurants, cafes, and individuals looking to buy in bulk. 

The other companies under Salim Group are said to be involved in supporting the platform, especially in FMCG and automotive parts. 

Salim Group is not the only big player showing interest in the growing niche. Prior existing players in B2B space like Bizzy and Mbiz each has the backup of conglomerates like Sinar Mas and Lippo Group respectively.

“Indonesia is still a promising market for B2B ecommerce, some competitors are also targeting different market segment. So the pie is still big but less competitive”.

Read the rest of the story here.

3. Ecommerce platform for virtual goods, Itemku, raises funding from 500 Startups

Jakarta-based Five Jack, the parent company behind Itemku, announces today that it has raised $1.2 million of funding from 500 Startups and undisclosed South Korean venture capitals, as reported by e27.

Itemku is a platform that allows gamers to make money from their in-app purchases with a secure financial system. The company is planning to use the funding to expand its operation in Southeast Asia within the second half of 2017.

Previously, it has raised investment from BonAngels in 2014 and 500 Startups in 2015. The total accumulated investment to date is $1.7 million. Itemku has recorded average growth of 30% per month according to CEO Denis Kim.

There is a big price gap of virtual game goods between emerging and developed countries, so we can take advantage of arbitrage opportunities. itemku can connect sellers in emerging countries to buyers in developed countries,” said CEO Denis Kim.

Five Jack, founded in South Korea and Indonesia in 2013, started out as a price comparison and classifieds ads website before pivoting to sell game items and currency in 2015.

Read the rest of the story here.