Posts

ecommerceIQ, together with Sasin SEC, created the Leadership Ecommerce Accelerator Program (LEAP) to provide the fundamental knowledge and skills needed to successfully run an ecommerce business in the world’s fastest growing market.

Originating from China, Singles’ Day online shopping festival has become Asia’s official Black Friday and Cyber Monday since 2009. Taking place on November 11th of every year, it was initially set up to celebrate the individualism of Chinese consumers but became an annual online shopping extravaganza that Black Friday and Cyber Monday sales combined cannot even touch.

Southeast Asia’s very own Singles’ Day, nicknamed the Online Revolution, happens on the same day.  For the last class in the Leadership Ecommerce Accelerator Program, students learned how knowledge was put to action through a practical look at ecommerce operations in a 21,000 sqm fulfillment center handling B2B and B2C orders for 11.11.

Project Management is the Backbone of Your Fulfillment Center

Lai Tze Siung (TS), Operations Director aCommerce Thailand

Lai Tze Siung (TS), Operations Director aCommerce Thailand

Whether you are preparing for 11.11 or beginning to set up a fulfillment center, frequently asked questions often revolve around the capacity and resources needed to run the warehouse efficiently.

So how do we answer such questions?

Proper project management.

At aCommerce, TS explains there are 5 stages: Initiate, Plan, Execute, Control/Monitoring and Closing. Some vital areas to watch out for is demand forecasting, which requires active communications with clients to plan for upcoming promotions and campaigns equating to high influx of orders.

For special sale periods such as 11.11, the warehouse floor is re-adjusted to increase efficiencies for the shortest process cycle time. Customer expectations during the holidays are much high than normal and must be managed.

Other tips? Ensure to call COD customers before arriving at their doorsteps to collect cash because many times they aren’t at home or don’t have the exact change.

Over the years, the entire ecommerce landscape has changed and shifted the way our warehouses are built. The packing tables, shelves and racks need to accommodate larger items as more consumers become comfortable with ordering items such as refrigerators and TVs online.”

After the presentation, TS and the operations team led the class through the fulfillment center to understand how customer service reps answer product questions.

More people are using social media to connect with their brands. We have seen the number of phone calls declining drastically over the years.”

The class was also showed how high-value items are stored in a secure location, which operations technology systems were running the backend and the entire picking and packing process.

The flow of our fulfillment center

A quick introduction of the safety measures and the fulfilment center operations.

The tour started at the inbound station, where goods are delivered to be stored according to brand. Items are also categorized according to its popularity. The fast-moving items are placed near outbound for quick pick-and-pack and delivery.

A walk through the large, bulk item section where 50” television, refrigerator, air conditioning units, etc. are stored.

aCommerce uses movable workstations to bring the labels and processing to the large items.

aCommerce staff explains the information each employee needed to complete the process. This includes the identification the location of the items or what are the items ordered in a basket.

At aCommerce’s pick-and-pack stations, where the items are being packed into boxes and the system will automatically choose suitable logistics supplier to complete the delivery.

As we come to the end of the first Leadership Ecommerce Accelerator Program, we look forward to celebrating the success of our senior executive class as they move forward in their companies with the new knowledge gained.

Thank you to all of our lecturers from leading industry players such as Lazada, Pomelo, eatigo, Kerry Express, honestbee and aCommerce. Thank you to Sasin Graduate Institute for the support and input. And congratulations LEAP graduating Class 2017 for the completion of Southeast Asia’s first ecommerce executive program!

For those interested in learning more about upcoming classes and workshops, please send us a message here.

If you haven’t had a chance to catch up on the past nine highlights from the 10-week program, here are the links to the past insights:

[LEAP Week 1] eIQ Insights: The New Ecommerce Opportunity in Thailand

[LEAP Week 2] eIQ Insights: Refinement of an Ecommerce Channel Strategy

[LEAP Week 3] eIQ Insights: Market-Product Fit First Before Anything

[LEAP Week4] eIQ Insights: Central Marketing Group’s Shares Phase II of Digital Strategy

[LEAP Week 5] eIQ Insights: Startups Need to Have an Independent Source of Income to Survive

[LEAP Week 6] eIQ Insights: In Mobile Commerce, App Install is Only the Starting Point

[LEAP Week 7] eIQ Insights: Logistics and Fulfillment, The Other Side of The Ecommerce Coin

[LEAP Week 8] eIQ Insights: Looking to Succeed in Fulfillment and Logistics? Start with Data and People

[LEAP Week 9] eIQ Insights: Thailand Must Do More With Less to Achieve a Digital Economy

Here’s what you should know today.

1. Government push: Singapore plans to spend $1.7b this year in contracts for Smart Nation apps

The Singapore government plans to dedicate US$1.7 billion to work with the private sector in financial year 2017, the Government Technology Agency (GovTech) has announced.

The government will work with industry vendors, including small businesses and startups, to develop technologies in data analytics and sensors as well as communications infrastructure that will connect internet-of-things sensor networks with data centers.

The Smart Nation Sensor Platform is a particular focus – a sensor network that covers the entire island and enables connectivity, data and video analytics, and data sharing between different government agencies.

This is another initiative taken as part of Singapore’s push to improve its nation’s technology advancement.

Read the rest of the story here.

 

2. Klinify raises investment from Zuellig Pharma, aims to become “one-stop shop” for doctors

Singapore-based clinic management solutions Klinify announced on Wednesday that it has raised an undisclosed investment from healthcare services provider Zuellig Pharma.

Klinify plans to use the new funding for regional expansion and product development.

Through the partnership with Zuellig Pharma, Klinify has already entered the Malaysian market where it said to have been adopted by group practices with 22 clinics in the country. It is looking to expand across Asia, from Thailand, Cambodia to Taiwan.

Read the rest of the story here.

 

3. Recommended Reading: 9 trends in last mile delivery

Carriers are bringing single packages to low density areas, and often the resident isn’t home. Yet customers are demanding faster and cheaper deliveries.

“We’re noticing a huge push and pressure on the fulfillment side to get orders turned around on a much faster scale and pace than a lot of the technology is capable of doing today,” says Michael Armanious, vice president of sales and marketing at Datexcorp, a third-party logistics (3PL) management and warehouse solutions provider.

What normally would have taken less than an hour, all of the sudden needs to go out within minutes, which poses challenges in terms of planning.

Faster fulfillment, the evolvement of postal services and insourcing deliveries are a few key trends in last mile delivery this year.

Read the rest of the story here.

 

Looking at ASEAN’s current $15 billion online retail sales and 19% YOY growth, the region’s ecommerce potential will continue to rise for the years to come.

Source: aCommerce Data & Research

Aside from the ecommerce opportunity in ASEAN, there are some market characteristics that professionals should be aware of before setting up own ecommerce operations. Understanding these characteristics and obstacles will define the success of future business endeavors.

So how can companies get started and set up a successful ecommerce business? What are the areas to look into before entering ecommerce?

Following this checklist will hopefully help ask the right questions and trigger appropriate initiatives: Read more

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



We’d love to hear your feedback,

find us on Facebook, LinkedIn or Twitter.

A new breed of startups are trying to tackle rural ecommerce in Southeast Asia, reports Tech In Asia.

Kudo agents source products from a number of ecommerce stores. The agents typically sit in mom and pop stores in rural Indonesia and install the app to sell a wider variety of goods without having to stock them.

The agents will help customers to pick items from the app’s product channels, place an order, and take cash in return.

From countries such as Cambodia to the Philippines, this is a common problem for ecommerce companies; most people are not familiar with the tools that would help them shop online.

Most  importantly, people need a bank account to make payments. In Indonesia, more than half of the population over the age of 15 do not have one. As a result of this, less than 1% of Indonesians actually shop online.

The untapped window of missed opportunities is large, especially for people living in remote areas. Agung Nugroho wants to solve that problem by working with small town shopkeepers and turning them into ‘agents’ that help others make online purchases. This is how his new startup, Kudo, was born.

Kudo’s network of agents grew from just hundreds in May last year to over 100,000 currently. 50% of agents are in Java, while the remaining 50% are spread out across other provinces, to Aceh to Papua.

Maybe you don’t trust the online seller, but you would definitely trust the owner of the small shop next to your house, who happens to be a Kudo agent. – Agung Nugroho.

The startup also plays a role in last mile delivery. Trusted shopkeepers who are familiar with the neighborhoods can fill that gap.

One of the best selling items is gold. People buy gold from certified merchants on ecommerce marketplace Bukalapak, which is one of the shops connected with Kudo’s app. It is considered a safe way to invest for the future.

Kudo’s next goal is to have one million agents spread across the country. Agung hints that the startup is making several million US dollars in monthly transactions.

A version of this appeared in Tech in Asia on August 10. Read the full version here

Alibaba to empower Thai fruit farmers through Tmall

Mango is a very popular fruit among Chinese consumers. Source: funnelogychannel.com

Following Alibaba’s 20% stake in Thailand’s True Corporation branch Ascend Money, the company is now planning to leverage from True Corporation’s Parent Company, CP Group, to offer Thai fruits on Tmall, Alibaba’s B2C marketplace.

Chinese marketplace Tmall currently owns 61% of the B2C ecommerce market share, the site attracts over 1 million shoppers and 150 million browsers visiting daily.

This new business aims to promote Alibaba services in Thailand, leveraging Chinese consumers’ preference for Thai fresh produce and encourage more Thai fruit produces to move online.

Nopporn Swaddhonphisut, Managing Director of Thai Fruit 1975 Co.Ltd, one of the companies on Tmall for the last two years, said there is a lot of cross border sales potential on the site.

On average, Thai Fruit 1975 makes approximately $11,4000 monthly, as shoppers prefer buying bulk quantities of mango and durian online; buying imported fruit off the street is more expensive for shoppers. This partnership is effective as Tmall eliminates the middle man and allows shoppers to deal directly with the owner of the fruit plantation. Local Chinese logistics providers can also partner with Thai companies for delivery to ease the fulfillment process.

Selling through Tmall is a way for companies to expand beyond the local market.

A version of this appeared in Prachachat Online on July 1. Read the full article here.

Events