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Asia’s mobile phone penetration matched with the high popularity of social networks has paved the way for social commerce to flourish in Southeast Asia. More and more online shoppers are using social media channels like Facebook and Instagram to browse and to negotiate a purchase of beauty products, apparel and other goods instead of buying it on typical ecommerce websites.

Thailand is the world’s biggest social commerce market where 51% of online shoppers have purchased goods directly via a social media channel.

Social commerce has been practiced by every third online shopper in Malaysia and Indonesia, while globally around 16% of online buyers have shopped directly via social media.

Across the region, Facebook and Instagram are among the most popular networks and on average, internet users spend from 1.6 hours in Singapore to 3.7 hours in Philippines on social media every day. This, the fact that Southeast Asians are reluctant to share their financial information online and less than 20% of population (except Singapore) use either debit or credit card to make payments drive social commerce in Southeast Asia.

How Social Commerce Works in Thailand

Usually merchants set up ‘shops’ on Facebook or Instagram, or both, and post images and details of goods for sale. Potential shoppers can browse and inquire about product availability and arrange a method of payment, typically a bank transfer, through a popular chat app such as LINE.

In social commerce, the order is usually made online while the payment – offline.

Social media ‘shops’ offer nearly anything from food, beauty and health products of various brands to apparel and accessories, sometimes secondhand or with minor defects. 

How Big is Social Commerce in Thailand?

The consumer-to-consumer (C2C) market size in Thailand is significant. Page365, a startup that helps small retailers sell products via social media, estimated that social commerce is worth more than $500 million per year in the Land of Smiles alone. However, it is difficult to accurately measure the market size as majority of sales from social media are conducted via bank transfer and merchants refrain from disclosing their real revenues.

ecommerceIQ decided to test one of several popular forums where shoppers frequently discuss favored and reliable Instagram/Facebook stores for makeup. The team chose an Instagram makeup shop by user @lachompshop due to popular word of mouth and recommendations on Pantip forum.

Case Study: The Social Commerce Journey

The search for products takes place by scrolling through @lachompshop picture gallery on Instagram. ecommerceIQ decided to purchase a MAC lipstick, which surprisingly was selling for 550 Thai baht, 300 Thai baht cheaper than in MAC’s official online store.

social commerce

social commerce

On social commerce shops products usually are browsed by simply scrolling through the seller’s Instagram picture gallery.

social commerce

A lipstick on MAC’s official online store costs 850 Thai baht while @lachompshop offered to sell it for 550 Thai baht.

The seller indicated her LINE account in the Instagram ‘About Me’ section so she could be easily reached for further product inquiries. The seller replied on LINE within one minute of the team’s question and confirmed product availability with a screenshot of the product from her Instagram page. The exchange was short – the seller noted delivery would take 3 days and after the team negotiated for express delivery in 2 days at no additional charge, she outlined more details – payment had to be made before shipping of product.

The seller sent her bank details so that 600 Thai baht (included 50 baht delivery cost) could be transferred to her account. The entire purchase process was simple – a short exchange on the chat app with a following bank transfer compared to filling online forms, payment card details, when buying online.

social commerce

The exchange with the seller took place on March 29, 2016.

social commerce

MAC lipstick that was ordered by ecommerceIQ team

Once the transfer was made, the transaction could not be cancelled. After the payment was done, the seller followed up in LINE with a tracking number from Thai Post so delivery could be followed online.

The MAC lipstick arrived in a brown package, sealed with a protective clear tape, and actually even a day earlier than expected. The delivery time in the end was just 1 day compared to 2-5 days waiting for products bought online from brand.com store or marketplace.  The product was in perfect condition in terms of exterior, in the original MAC packaging and was the right color. However, the lipstick texture was slightly smudged, possibly due to the heat during delivery. There was no pre-delivery text or call as would be in a typical ecommerce purchase.

social commerce

The new lipstick was delivered before expected for a nice surprise after agreeing on the purchase via Instagram shop.

Once the seller was notified of the product arrival, she responded politely within 5 minutes adding an element of personalized contact to make the experience more positive.

The Good and the Bad of Social Commerce

Facebook and Instagram provides an inexpensive opportunity for upcoming, small brands to sell online at a lower cost compared to creating a full-fledged webstore. The direct communication with sellers also adds a personal touch, which Southeast Asian shoppers find important to gain trust in the seller, the brand or product.

However, the same trust with regards to product authenticity and payment is also a concern when buying from sellers who stock various products on C2C platforms. Data from Page365 shows that 74% of consumers are reluctant to shop online because they fear fraud and 33% of consumers have complained about product imperfections when ordering from Facebook stores. There have been cases reported when the customer transfers money to a seller via bank transfer prior to a product delivery just to find out later that the seller took their payment and cut off contact.

There is also risk of receiving fake products and C2C shops are usually less willing to accept returns, as in the case with @lachompshop who explicitly stated that unless the product was damaged or delivered in the wrong color, returns nor refunds would be accepted.

Yet, for many, especially in provinces where malls are not easily accessible, social commerce is an easier way to get products they want without having to shop online and without having a credit card. Although it does takeaway from ecommerce websites, the wave of social commerce allows consumers to adopt online shopping habits and eventually encourage them to trust e-transactions. 

What to Expect Next

Seeing the popularity of social commerce, other businesses are looking for ways to enter the market. This June, Facebook started testing social commerce payments in Thailand and later decided to launch the world’s first Facebook Shop in August. LINE, which is widely used to communicate with buyers of social media shops, launched its own ecommerce app LINE Shop already in July 2014.

C2C marketplace Shopee, which is among the most popular apps in Thailand, is trying to attract merchants currently selling on social networks, to its online marketplace by offering easy integration of their Instagram shops and reimbursing shipping, cash on delivery fees to sellers.

The positive experience ecommerceIQ had testing social commerce shows why for many it may be more convenient to shop via social networks than overcome concerns about the security of digital payments to shop online even if it means a few added small risks. 

As the ecommerce market size in Southeast Asia is expected to increase nearly 15 times to $88 billion by 2025, social commerce will likely grow as well thanks to a relatively low online presence of Western brands

 

BY AIJA KRUTAINE AND ANUTRA CHATIKAVANIJ

 

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Up until this point, we’ve covered driving traffic to your online store, where to best sell your products and the type of content that increases conversions. Now we will be sharing a few tricks to make it easy for store visitors to complete their purchase, something commonly overlooked. From the checkout process to receiving the package, in this article we discuss how to decrease cart abandon rates and last mile best practices.

55% of consumers surveyed by PwC in Southeast Asia report they are shopping online monthly or more frequently, and returning customers are one of the easiest ways to grow ecommerce business. Creating a stress-free checkout process and delivering pretty package on time are vital factors to gain customer loyalty.

Once the shopper is happy with their product selection and ready to checkout, ensure the final steps in their online journey, the last mile, are hassle free. Businesses can do this by:

  • Providing easy checkout process and being transparent about any extra costs
  • Offering a ‘cash on delivery’ payment method
  • Creating the best image of your brand with smooth delivery of the product

 

Optimize your store’s checkout process

Abandoned shopping carts are the worst nightmare of online sellers as they present lost revenue. And it’s usually because every fourth customer is frustrated when there is too much information to fill upon checking out.

An overly complicated checkout form can scare off over 60% of potential buyers therefore the shorter the checkout form and the less clicks your customer has to make, the more likely that she or he will finish the purchase.

For example, Estée Lauder’s checkout form of its Thailand webstore is rather long. It requires, first, user registration and, second, to fill in a separate line each item of the address, eg. house number, alley, road, district, county, instead of using a text field for the user to enter everything at one go. This probably makes it easier for the brand to process data in the backend, but doesn’t make for a great user experience.

last mile delivery

last mile delivery

Checkout form of the Estée Lauder online store in Thailand is quite lengthy.

To checkout from Kiehl’s Indonesia webstore customer first has the pleasant task to choose free samples. But after that she or he is directed to sign in or register an account, then has to look again for the shopping cart and gets to fill the checkout form only after a few more clicks.

In both cases, customer at some point may feel impatient or confused and such experience may reduce conversion rates.

To best capture your shopper’s purchase, offer a guest checkout option and create a simple, one-page checkout form asking the buyer to fill only the necessary information – name, address, phone number and payment details. Do you really need to know your customer’s birthday adding one more line to fill during the checkout?

Be sure to offer various payment options based on the preferences of your target audience and show that you are serious about the security of the payment displaying secure payment gateway branding such as SSL (Secure Sockets Layer) certificates.

With a total of 5 clicks from landing to checkout to submitting your order, Maybelline Thailand is a good example of how to simplify the checkout process. While it requires a registration, it is very simple and quick, and the checkout form is just one-page.

last mile delivery

Maybelline Thailand store has created simple one-page checkout.

To avoid abandoned carts, brands should be transparent about the costs that the buyer might incur in addition to the product price. Around every fourth customer drops the purchase because of unexpected shipping costs and 45% of customers tend to add products to their cart without intent to buy in order to check the final price.

Show all the additional costs that the customer might have to pay or highlight free shipping with minimum purchase value – around 24% are more likely to spend more to be eligible for free delivery.

Prioritize cash on delivery as payment method

In Southeast Asia, cash is the preferred payment method for the majority of customers – in Thailand 83% of them would prefer to pay with cash on delivery, in Malaysia – 82%, in Singapore – 72%. Less than 10% of the population in Thailand, Indonesia and Vietnam and less than 20% in Philippines and Malaysia use banking cards to pay for their purchases.

Offering cash as a payment method will increase the number of customers who want to purchase goods online as the conversion rate on cash on delivery is higher than bank transfer and bank service combined. This is due to low credit card penetration rates and high mistrust issues with entering payment information online across the Southeast Asian markets.

In Thailand, other payment methods which customers without bank accounts can use include payments over the counter in convenience stores 7-Eleven and other shops or cash deposit in a bank or ATM. However, by offering these payment methods, a merchant pushes the customer to decide twice on buying the product – first time on the webstore and second time when the person has to go to either the counter or the bank to actually make the payment. Thus, giving customers another opportunity to reconsider and cancel the purchase.

Make the delivery of the product stress-free

Delivery times, customer service, the aesthetic appeal of the packaging and even the etiquette of the messenger is a business’s final chance to leave its consumers satisfied. Yet, some brands fail to align their global image with the “last mile” delivery.

When a customer makes a purchase, she or he, of course, is interested in the particular product and will presumably make a purchase if your site is optimized but that doesn’t mean the box in which the product is sent should be neglected. The goal is to make the shopper feel like their online purchase was worth it.

In a recent study, Dotcom Distribution found that 40% of consumers are likely to make repeat purchases from an online merchant that delivers products in gift-like or premium packaging. If the delivery came in a unique package, consumers are also more likely to share it via social media. Instant free marketing!

Here are a few things to consider for special packaging:

  • Use a branded box, not just the standard brown box from the logistics provider
  • Use branded or coloured tissue paper, not hard paper to wrap product
  • Consider branded or coloured tape instead of clear tape
  • Include small gift samples to increase cross-selling
  • Protect the branded box by putting it in a standard brown box

It is extremely vital to premium brands like Bobbi Brown, Kiehl’s, Estée Lauder and MAC to provide proper packaging to protect their brand image and justify higher product costs. In Thailand, they are trailblazers as to how their products are represented when delivered.

last mile delivery

last mile delivery

Premium brands Bobbi Brown, Kiehl’s and MAC have invested in a gift-like packaging. Source: ecommerceIQ

Yet, the arrival of French brand’s L’Occitane package provided somewhat disappointment.

last mile delivery

Franch brand L’Occitane delivers products bought on its online store in standard packaging.

There comes a high cost to providing this special packaging in the right size. As it can be seen in the table below, just having a brand’s logo on the box and using a branded tissue paper can increase the packaging costs 3 to 5 times, while having the full premium branded packaging means even bigger expense.

last mile delivery

“If you have an average basket size of over 1000 THB, it makes sense to have a branded box. Even if not the case, brands should see the packaging as an extension of its marketing and pick a style that aligns with the brand’s global image, as it is the customer’s final touchpoint,” says  Phensiri Sathianvongnusar, aCommerce Thailand COO.

Take into account that shipping costs are calculated by volume metrics, not by weight. This is why it’s important to have a couple box options that are efficient for the physical average basket size of your product.

When you’ve invested your time and resources to get potential customers to visit your online store, don’t sabotage your efforts by complicating the checkout process and ignoring careless fulfillment. Provide an enjoyable purchase process experience, surprise them in a positive way with gift-like packaging, and you will win their hearts.

Southeast Asia’s ecommerce boom in the recent years has fostered the establishment of fulfillment companies who can advise your brand on the best practices. See who they are for Thailand and Indonesia.

Stay tuned for next week’s beautyIQ piece in the series!

BY AIJA KRUTAINE AND ANUTRA CHATIKAVANIJ



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This article of the beautyIQ series will provide tips on how to target customers and generate demand for your products in Southeast Asia. In the previous articles, we looked at how to create engaging, localized content and where to best sell online to present your product correctly to Southeast Asian customers. Even if you have the best product in the world, it is important to get it in front of the eyes of potential customers.

The internet is full of tips on how to do automated personalized email marketing, show up at the top of Google search and run ad campaigns to lead browsers to your online store, but with such a diverse and large audience as in Southeast Asia, the general ‘spray and pray’ digital marketing strategy will not work. To make your marketing campaigns successful, the trick is to leverage on the online and shopping behavioral traits of your target audience in each Southeast Asian country.

Which channel does your target audience use for product research? Which are the most popular social media networks? Do customers use laptop or mobile to buy products online?

Southeast Asian nations are among the ones who spend the most time online. Philippines is the second country after Brazil by hours spent online daily – people aged 16 to 64 years access internet through their computers 5.2 hours and through their phones – 3.2 hours every day.

Singaporeans are the least internet active – they spend online daily “only” 4.2 hours on their PC and 2.1 hour on their phones. This provides an excellent opportunity to reach your customers through various online tools as they are connected for the most part of the day.

These are some of the habits you will want to know before moving forward with your online marketing campaign. The better you understand your customer, the more you know what they want. Many companies already sit on gold mines of unutilized consumer data – take advantage of it as well as these reports to increase the success of your digital marketing strategy.

An ecommerce marketing strategy in Southeast Asia should include the following parts:

  • Continual communication with the customer, i.e. several direct emails per month
  • “Always-on” paid search campaigns
  • Dynamic retargeting
  • Discounts and samples

 

Send Emails to Keep Communication Fresh

As 96% of online Southeast Asian consumers identify themselves as email newsletter subscribers and 48% have made a purchase as a result of a marketing email, it is the top communication channel for marketers who target their products to customers in the region.

Offer your customers a newsletter subscription pop-up with an incentive and send them emails directly (EDMs) one or two times per week depending on how many promotion campaigns you plan to run. If you offer deals more frequently, send emails more often. aCommerce internal data find that even if your offers are less frequent, sending emails accordingly to remind your subscribers about new products at least once or twice a month will still result in conversions.

Some tools to automate email marketing include: Campaign Monitor, MailChimp, Getresponse Bluecore.

Examples of beauty brands that do it correctly: Kiehl’s presents first time visitors with an email newsletter subscriber pop-up, offering free delivery and samples. Other brands may take it one step further by offering a specific incentive such as a discount off a user’s first purchase.

Premium cosmetics brand Kiehl’s motivates customers to subscribe to its newsletter with incentives. Source: Kiehl’s Thailand online store

Bobbi Brown Thailand is another brand that continuously connects with customers through emails. It lands weekly emails into subscribers’ inboxes with promotion details, a call-to-action (CTA) link on the image in the email which directs them to the Bobbi Brown website and occasionally, discount promotion codes.

Bobbi Brown offers its customers in Thailand a gift with a purchase worth 2,500 baht. Source: Bobbi Brown weekly newsletter

Once a visitor has subscribed, brands should follow up with personalized emails, which is among the most effective channels for ecommerce business to drive orders. In 2014, the average return on investment in email marketing in Britain was 38 pounds ($47) for each 1 pound spent. Yet, even smaller returns make it worth invest in email marketing.  

Building up a customer database opens the door for marketing automation and highly targeted customer acquisition and activation at scale in the future.

Keep Paid Search Campaigns “Always-On”

Search marketing is the most effective customer acquisition tactic and customers in Southeast Asia, same as elsewhere around the globe, turn to search engines when looking for information about products they want to buy. In Singapore, 67% of internet users searched online for a product or service to buy, while 48% in Thailand and 31% of Indonesia’s internet users did the same.

Google provides excellent tools for brands to appear at the top of search ranks when customers search for a product from your line. Don’t let your competitors or other distributors steal customers who look for your products – do paid search marketing. It means you bid for ad placement in a search engine’s sponsored links for keywords related to your business – your brand name, product line or generic product name you sell. Then you pay the search engine a fee for each click.

If the benefit of an online store is purchase at anytime, brands should drive traffic to their sites by keeping paid search campaigns “always-on”, especially for its own brand keyword.

For example, when searching for South Korean cosmetics brand Innisfree, the first link that appears in Thailand is a paid ad of a US online store, iHerb, which sells online Innisfree products among others. The webstore of Innisfree itself appears as the second link, which means that Innisfree is not bidding for their brand name and may lose potential customers.

Source: Google search results page for South Korean cosmetics brand Innisfree

Kiehl’s, Maybelline and Estée Lauder, on the other hand, are brands that run “always-on” campaigns. Keyword search for Kiehl’s brings the brand’s ecommerce site the first on the search engine result page, ahead of other online shops who also sell Kiehl’s products in Thailand and bid on the same keyword. This allows Kiehl’s to acquire high value customers through its brand keyword searches and control the customer experience end-to-end.

Source: Google search results page for premium cosmetics brand Kiehl’s

The average cost-per-click (CPC) for your own brand name is very low as Google gives brands and their landing pages a higher Quality Score, and the more people click on it, the more relevant it becomes and the cheaper it will cost for the brand. There should be no excuse for not bidding on your brand name all year round, even if it is just to protect the brand against competitors.

If you register on Google Adwords, you will be able to estimate how much bidding on your brand name as well as other keywords would cost. Google will provide you with suggestions what other keywords you may want to bid to get seen on the search engine’s result page. For a new brand in the cosmetics industry the minimum recommended amount to spend on paid search advertising in Thailand, for example, is 7,000 Thai baht (around $200), while the average monthly budget might be around 20,000 Thai baht (around $570).

Increase Brand Awareness on Social Networks

Southeast Asia claims one of the highest social media usage in the world – in all six countries social media penetration exceeds 70% and is expected to grow in the future as well. On average, internet users in the region spend on social networks every day from 1.6 hours in Singapore to 3.7 hours in Philippines. Across the region, Facebook and Instagram and Youtube are among the most popular social media networks.

Use this knowledge to run dynamic retargeting campaigns – it means that customers who’ve already once visited your site to look for a product, but have left without a purchase, would be reminded on social networks such as Facebook that the product they are interested is still available on your online store.

Dynamic retargeting through platforms like Google, Criteo or Sociomantic are the most effective channels in ecommerce to drive both customers to your online store and sales. Platforms like Criteo allow brands to retarget users across both Facebook and ad networks as well as across multiple devices. Dynamic retargeting is a “no-brainer” channel commonly applied by retailers such as Lazada and Sephora, but unfortunately still ignored by many brands.

Facebook also allows businesses to target ads towards existing customers or potential customers that share their interest with its Ads Manager function, a ‘lookalike audience’. That is another way you can make your customer list work for you.

Offer Discounts and Samples To Drive Sales

Everyone loves discounts, especially in Southeast Asia. According to a Mastercard Survey, 75.8% of Thais are influenced to shop impulsively from online merchants when prices are lower, second only to shoppers in the Philippines, who came in first at 76.4%.

Offer discounts to your customers on certain product lines or on major public holidays, when people like to give gifts to one another to keep them coming back to your online store. In addition, offer them samples to try out new products. Both of these incentives work well as retention strategies.

Brands such as Bobbi Brown and Kiehl’s offer samples upon check-out, allowing shoppers to choose between miniature sizes of cleansers and toners, providing in-store perks with the online experience. A small, yet pleasant detail.

Shoppers can choose up to 3 samples upon check-out on the Kiehl’s Thailand website. Source: Kiehl’s Thailand online store

 

Southeast Asian consumers’ internet usage and shopping habits offer a great opportunity for brands to capture existing and new customers – they are already online, a nudge with an email subscription or a discount might be all that is needed to persuade them to buy your products.

Stay tuned for the next article in our beautyIQ series the following Monday. To better understand the general population habits in Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam, we have also gathered reports and infographics to better guide your journey.

BY AIJA KRUTAINE AND ANUTRA CHATIKAVANIJ

 

We’d love to hear your feedback,

find us on Facebook, LinkedIn or Twitter.

beautyIQ Series Part 1 looked at various practices global brands use in Southeast Asia to boost sales through intertwined transactional and discovery content. This article will focus on the importance of adjusting content to the cultural preferences of brand’s target customers in order to grab market share. Let’s begin!

Smartly crafted website content is essential to engage customers and nudge them towards making a purchase. Even more important to note is that

75% of shoppers are more likely to purchase products with information in their native language.

Southeast Asia constitutes diverse countries with varied consumer trends. To thrive here, global brands need to understand the demands of each market by localizing their content, offering promotions on local holidays or using faces familiar to the target audience in photo shoots. While it may not be budget friendly to create unique content for each country website, even small adjustments have the potential to increase a website’s conversion rate by as much as 25%.

Here are three ways brands can make their online content more relevant for customers in Southeast Asia:

1. Communicate like a local

To enter a new market, any brand should ‘speak’ the language of the country. That is especially the case in Southeast Asia where English language proficiency levels vary widely across countries. In Indonesia, Vietnam and the Philippines, the levels are moderate, while Thailand and Cambodia rank 62 and 69 out of 70 countries, respectively. The only Southeast Asian countries with high proficiency of English are Singapore and Malaysia, who were a part of the British Empire in the last century.

The first step brands should take when launching an ecommerce website is providing a language selector for countries with low English proficiency in addition to a site in English.

French cosmetics store chain Sephora has web shops in local languages in Indonesia, Thailand and China, but its online stores in Malaysia, Philippines and Singapore are in English.

Sephora caters to local customers in countries with low level of English language proficiency by providing the content in customers’ native language. Source: Sephora Thailand website.

 

Yet, the difference between being good and being great is not simply translating website content, but also taking into account cultural differences and preferences.

The global brand that stands out with well crafted content is American premium cosmetics retailer Kiehl’s. Besides its brand.com website being available in Thai and Bahasa languages, Kiehl’s collaborates with local brands to leverage popular social media trends.

In Thailand, Kiehl’s collaborated with Jay The Rabbit, local loveable Facebook sensation, on ‘Kiehl’s heritage for Thai heritage’ campaign where it donated part of the earnings to an elephant foundation. This would definitely score brownie points in Thailand, once ranked the most generous country globally. 

Kiehl’s works with social media influencers to increase its brand awareness and engage new audience segments. Source: Kiehl’s Thailand website.

 

Kiehl’s also has dedicated Instagram accounts in Indonesia, Malaysia, Philippines, Thailand and Singapore, to share promotions relevant for locals, such as hijab and makeup demos in Indonesia. At the same time, all sites and social accounts are consistent in maintaining Kiehl’s global brand identity with look and feel.

Kiehl’s localizes promotional campaigns making them relevant to their target customers. Source: Kiehl’s Indonesia Instagram account.

 

Many global brands have strict guidelines that leave little room for maneuver – meaning promotional campaigns, visuals or tutorials targeted to Southeast Asia have to be the same across all countries from headquarters in North America. If brands don’t adapt to cultural preferences, however, they fail to engage customers and face getting overshadowed by competitors with more flexibility.

2. Leverage the power of peer and celebrity opinions

Asian shoppers’ purchase decisions are strongly influenced by peer feedback and celebrity association, according to a report by PwC.

47% of customers in Asia consider opinions of friends and family before making a purchase, while 90% are influenced by information found on social media.

In Thailand, one of the brands that leverages the potential of local celebrities, bloggers and other key online influencers for their promotional campaigns, is Maybelline. Its Youtube channel, which is featured on its local brand.com website, contains many videos with well-known Thai celebrities and beauty gurus – immediately putting their products in front of a new audience.

Maybelline features several videos with Thai model and actress “Lukkade” Metinee Kingpayom, Thailand’s Kate Moss. Source: Maybelline Thailand Youtube channel.

 

In Indonesia, Kiehl’s collaborated with well-known actor Nicholas Saputra and TV presenter Sarah Sechan for their ‘Kiehl’s Gives’ campaign to support Wehea Forest Preservation in East Kalimantan.

Indonesian celebrities became personality partners of Kiehl’s to support Wehea Forest Preservation in East Kalimantan. Source: Kiehl’s Indonesia Instagram account.

 

Global brands should also use Asian models to showcase products as it’s crucial for the customer to gauge how a blush or lipstick shade would look on their own skin tone. For example, Maybelline Thailand uses predominantly Thai models in their product videos hoping consumers can more easily identify with them.

Source: Maybelline Thailand Youtube channel

 

Skincare brand Nivea also uses local-looking models on their Indonesian, Filipino, Thai and Vietnam local websites (although it is not possible to buy their products online).

Source: Nivea Indonesia website

 

Brands such as Shu Uemura and Bobbi Brown also have a balanced mix of Asian models integrated in their visual web content.

Source: Shu Uemura Thailand website

 

Another issue brands may want to consider is the fact that around 40% of Southeast Asia’s population identify as Muslims. Luxury brands such as Dolce Gabbana, Oscar De La Renta and DKNY as well as fashion brands like Uniqlo and Mango hope to tap into this new customer segment by creating apparel collections specially targeted to Muslim women.

While no global beauty brand has created ads using Muslim models in hijab, Indonesian brand Wardah takes it one step further by offering halal beauty and skincare products and personalizing the marketing to Muslim women as seen below. 

Indonesian beauty brand Wardah creates products particularly for Muslim women. Source: Wardah Indonesia website.

 

3. Celebrate like a local

Due to its cultural and religious diversity, Asia has many major holiday and festival seasons. And as the region’s incomes rise, so too does its holiday spending, creating a wealth of opportunities for businesses. — Nikkei Asian Review 

While Christmas gift frenzy might be global, other celebrations vary from country to country. To achieve the best results, promotional campaigns should be adjusted to major holidays and cultural events of the particular country.  

Kiehl’s in Thailand is a good example how to leverage holiday season. The company centered their promotion around Songkran Festival, which marks the Thai New Year, to offer special discounts for its products and drive sales.

Localize promotional campaigns leveraging on public celebrations. Source: Kiehl’s Thailand Instagram account.

 

Popular public celebrations brands in Southeast Asia can benefit from are:

  • Western New Year
  • Chinese New Year celebration
  • in Thailand Songkran Festival and Her Majesty the Queen’s Birthday (which is celebrated as Mother’s day)
  • in Indonesia the month of Ramadan has become known for driving online retail sales and Harbolnas

While it may be complex to calculate exact return on investment in localization of content, the benefits of it for global brands include first mover advantage and higher revenues from new markets.

Tailoring content to match local quirks and preferences, whether it’s using models that match the general consumers’ skin tone or leveraging the popularity of local celebrities, will help you monetize local behavioral traits such as the fact that 87% shoppers in Asia share their retail experiences on social media.

Stay tuned for the next article in our eIQ series the following Monday that will focus on tools needed to distribute products on various platforms in Southeast Asia.

BY ANUTRA CHATIKAVANIJ AND AIJA KRUTAINE

 

We’d love to hear your feedback,
find us on Facebook, LinkedIn or Twitter.

Ecommerce website content, which encompasses all copywriting and visuals, provides the first impression of a brand to any customer. Content is a major deal breaker for an ecommerce website to inspire confidence to shop without the user seeing or sampling the product. 34% of online shoppers in the Philippines reported they were influenced by online content prior to making the purchase.

With its young populations, growing middle class and digital adoption, Southeast Asia is right in the middle of the ecommerce hype. Around 40% of Southeast Asia’s 620 million population have smartphones and 100 million or one in four consumers over the age of 16 have made an online purchase. The region’s middle class is expected to double to 400 million people by 2020.  

As a result, global brands are looking to expand their online footprint in the region. So how can ecommerce sites in the region ensure returning traffic and ultimately convert their visitors?

To create engaging content, an ecommerce site in Southeast Asia should include these features:

beautyiq-content-types

Transactional content means that product images, collections, and reviews should be enticing and lure customers to make the purchase without seeing the product in real life.

Discovery content, also known as editorial, is the content that does not have a strong sales message, but is useful or enjoyable to the user. Discovery content is not new in the online world, but brands that are able to blend both transactional and discovery content seamlessly will find themselves ahead of the curve.

Localized content means that content is not just translated, but together with visuals it is adjusted to cultural preferences of the target customers.

The first of beautyIQ series will cover tips for making good transactional and discovery content, while the importance of the localization will be featured in the next article later this week.

eIQ’s Take on Thailand’s Beauty Ecommerce

eIQ has taken a deep dive into the ecommerce maturity of beauty brands in Thailand. Worth over $7.2 billion, the beauty industry in Thailand is highly attractive for brands overseas, especially due to high demand for global beauty products in the local markets.

eIQ combed through global brands who have their own brand.com websites such as MAC and L’Occitane, and also brands who sell their products on ecommerce marketplaces. This series will provide insight on various topics to show how these beauty brands successfully approach the tricky market that is Southeast Asia and how they could further tailor their transactional and discovery content for consumers in the region. Here are the top three content must haves:

1. Invest Big in Visuals

75% of customers cite quality of images as the most important feature when viewing products in online stores. Without being able to touch and feel the product, customers can only rely on images to make their decision so it is extremely critical to show them an accurate color tone  and provide the option to zoom. This also ensures they do not get a disappointing surprise when they receive the product – ending up in a negative review of your brand. For that reason, high resolution images is quite obviously a must.

Unlike fashion, beauty has the challenge of selling a product that looks virtually the same no matter what angle it is photographed at. As a result, eIQ found that the majority of the brands limited their product display to a zoom functionality of the container. This is not considered helpful in the customer journey when deciding whether to make the purchase of let’s say, a lipstick.

How can a brand show a product’s texture or color palette other than simply contrasting the desired tone against a white (or black) background?

South Korean cosmetics brand Innisfree is a trailblazer in this area and can provide some ideas even to major global brands. Its online store provides high resolution product images in multiple angles – from top, from side, with packaging or flat on the table. All products have zoom option and are photographed in an environment that feels like home.

Innisfree also uses real models to showcase the genuine color and texture of the products. For example, a customer can compare tones of eyeshadows or see the texture of a cleanser applied on a model’s skin. Whether the brand is selling cosmetics or skin care, the goal is to give shoppers a ‘real life’ perspective.

Innisfree texture

Innisfree uses models to showcase the genuine color and texture of their products giving shoppers a ‘real life’ perspective. Source: Innisfree website

 

Attractive, clean images do not require the best of breed photographers. It is possible to do it yourself using simple Shopify’s at-home tutorial or outsource to a content specialist who excels in digital production such as Channelsquid CMS.

channelsquid

Channelsquid CMS offers companies to outsource creation of visuals and content to specialists who excel in digital production. Source: aCommerce website

2. Encourage Customers to Leave Reviews

According to Econsultancy, 63% of customers are more likely to make a purchase from a site which has user reviews, and the sales uplift from reviews can be as much as 18%.

Unlike in Western markets, many brands in Thailand omit the funcionality of user reviews on their brand.com webstore. Gain from customer reviews by making them as visible as the product purchase content. L’Occitane local webstore has reviews in Thai language and also incorporates reviews in English from customers overseas providing a broader overview of customer experience. On the Innisfree webstore, customer reviews are easily seen right below the “Add to Bag” button.

L’Occitane user reviews are easily seen on its product description page. Source: L’Occitane Thai website

Customers will not skip Innisfree product reviews that are featured just below the “Add to Bag” button. Source: Innisfree website

However, it is not only about creating the functionality, customers should be actively encouraged to leave reviews. For example, American premium skincare brand Kiehl’s on its Thai webstore enables reviews after the user has made a purchase. Another option is to offer a discount or some other incentive for users to leave a review.

One of the best tools of marketing still is word-of-mouth, therefore allowing your customers to share their favorite products on social media channels by having share buttons will be for your benefit as well.

3. Combine the Shop and Editorial Content

“How-to” make-up tutorials either as blog posts or videos show the brand’s products in action and can nudge viewers anywhere from 64-85% more likely to purchase. Yet often the discovery content is isolated from purchase content. As eIQ observed, in many cases the user is asked to make a choice between entering the site’s magazine/blog or entering the shop.

The best practice is to give the user an option to browse through both blogs and shop. Websites such as Estée Lauder and Bobbi Brown succeed in framing content around certain products in an educational narrative of how-to tips, which also gives the user an option to click on the product and make a purchase.

Beauty brands Bobbi Brown and Estée Lauder offer how-to tips while also giving the user an option to click on the product and make a purchase. Source: Bobbi Brown and Estée Lauder Thai online stores

The blend of editorial and product content also works the other way around – with links to tutorials or blogs included on the product description page.

Another way to offer the user a glimpse into the variety of products is user generated content. Drive traffic and sales to your brand’s webstore by integrating social media, such as Instagram or Facebook,Youtube, posts of local beauty bloggers or make-up artists using the brand’s products.

By using a hashtag or creating a special campaign, your brand can save costs and let the happy user showcase their satisfaction with your product on social media.

Kiehl’s Malaysia Instagram account encourages users to use the hashtags #mykiehls and #UseItRight in order to be featured on their page. The content created by their customers is spread across their other country specific accounts such as Kiehl’s Thailand.

kiehls-ig

Kiehl’s Malaysia features on their Instagram account customers who use their products and share pictures with hashtags #mykiehls and #UseItRight. Source: Kiehl’s Malaysia Instagram account

 

Offering discounts is another way to incentivize customers to share their experience. This strategy not only increases audience reach as customers share your brand with their network, but also helps other potential customers. 93% of customers find user generated content helpful when making a purchase decision and it can increase web conversions by up to almost 30%.

Stay tuned for the next article in our eIQ series that will focus on the importance of localization, content adjustments to cater to cultural preferences.

By Anutra Chatikavanij and Aija Krutaine

What do you think makes content a lasting impression?
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Cosmetics and healthcare manufacturer from China, Longrich Bioscience, is eyeing the ecommerce market in Indonesia as reported by Bisnis.com. The company feels optimistic about its venture in the country as it sets a monthly target of $300,000 sales per month by 2017 and $1 million of sales per month in the next five years.

Longrich International President, Charlie Chin said that the company is confident with its target as the economy in Indonesia is getting stronger and people’s purchasing power in the country will continue to increase.

The company is not alone in their opinion, back in June, Chinese investors have also expressed their confidence in Indonesia’s future business outlook.

Longrich eyes markets beyond Java

Longrich has been operating in Indonesia since 2013 and has seen a positive growth in the last 1.5 years. General Manager of Longrich Indonesia, Thamrin Slamet claimed that the sales growth has reached 120%.

In addition to producing its own line of products, the manufacturer also serves other brands such as GlaxoSmithKline (GSK) who owns the toothpaste brand Sensodyne.

Indonesian big cities like Jakarta and Surabaya are the main markets for Longrich’s variety of products but the company will not only focus on Java, Indonesia’s most populous island. It has a business center in Medan, North Sumatera. It also serves the people in Palembang and big cities in eastern Indonesia.

Globally, Longrich is present in 15 countries and recorded $167 million in revenue globally in 2015.

A version of this appeared in Bisnis.com on August 14. Read the full article in Bahasa here.