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*Thanks to a ecommerceIQ Community member for sharing the launch of LazMall with us:

In case you missed it, JD Central’s long awaited joint venture went live in Thailand a few days ago:

ecommerceIQ

And reviews have already come in,

ecommerceIQ

Though rough, the experience has been positive so far and as expected by JD, delivery reliable and quick. The partnership with Thailand’s largest retail conglomerate Central Group indicates JD.com is attempting to replicate its value proposition in China in Southeast Asia: a high quality ecommerce experience for authentic goods.

“If you promise people to deliver same day, people will more likely buy. Our people will literally cross rivers and climb mountains to get the package to the end customer.” – Louis Li, former Deputy GM of JD Worldwide

It seems Chinese players Alibaba and JD.com are looking to establish its number one and number two statuses in Southeast Asia ecommerce, respectively. Alibaba known for its hit-or-miss products at cheap prices and JD.com for the authentic goods and reliable customer experience.

And now that JD.com has planted its flag in Thailand, Alibaba/Lazada isn’t going to sit back casually – hence, (re)introducing LazMall.

ecommerceIQ

Consumer newsletter by Lazada Thailand

What is LazMall?

Very simply, it is a replica of the widely successful Tmall in China – a platform for official brands. In Lazada’s own words:

‘LazMall is an exclusive channel featuring items sold by leading international and local brands.’

“At LazMall, we aim to offer an online shopping experience of the highest-quality to garner the trust of our customers and provide the convenience they long for. LazMall will provide customers with the following promises: 100% authenticity and 15-day easy returns.”

There also appears to a number of benefits by becoming a LazMall seller:

• LazMall badge on all your products throughout the customer journey; see LazMall Indonesia
• Enjoy higher visibility on homepage and higher search ranking
• Exclusive access to dedicated LazMall campaigns
• Dedicated customer service team for LazMall customers

ecommerceIQ

Brand dashing to marketplace

Not quite.

Brands commonly will teeter with the idea of a brand.com and/or marketplace and the answer we always give is “a marketplace strategy is important in Southeast Asia as part of a bigger digital strategy, but it shouldn’t be the only online effort by a company.”

While LazMall aims to create a safe space for brands to promote themselves online by setting strict authenticity procedures and greater visibility over unofficial sellers, activity the US and China have taught us the brand relationship with a marketplace is a tricky one and from it emerges a power struggle.

A well-known American brand saw its Tmall sales plummet 10% to 20% for 2017.

“Based on our sales record, we should have been in a prominent position, but we were at the bottom of the page,” said the brand’s ecommerce director, who spoke anonymously to the Bangkok Post for fear of further retaliation. “That’s a clear manipulation of traffic. That’s a clear punishment.”

Executives soon learn that what Alibaba gives, it can also take away.

How did the marketplace gain so much power?

A few factors. First, all that money business tech sites complained about marketplaces burning was to grab market share and market share translates into influence. If you’re not present on marketplace or selling on your own website, you’re losing an important revenue channel.

As reported by the New York Times about Amazon, Lazada also has an advantage over traditional retailers and its own merchants that no one else has: knowledge and access to data from its platform. 70% of Amazon’s word searches are for generic terms such as “running shoes” or “games”, meaning Amazon can choose what to display in search results. Will it be Nike or Adidas shoes? Well, it probably depends on who is being a better merchant to the marketplace – driving traffic, exclusive promos, etc.

We can expect something similar to take place in Southeast Asia but this doesn’t necessarily mean brands are guaranteed to lose out.

KitchenAid recently launched with us and their revenue was two times than targets,’ – Lazada Singapore Category Manager

The rise of digital has forced brands used to having 100% control learn how to barter for maximum visibility. The birth of a brand to marketplace relationship is also why ecommerce enablers are popping up everywhere in Southeast Asia to mediate the wants and needs of both.

“[Enablers] allow me to focus on my core business capability and rest assured online segment is still moving along” – eIQ Community Member, Ecommerce Enabler survey

Your move brands.

Want to learn more about participating in LazMall? Contact us at hello@ecommerceIQ.asia 

In 2015, Thailand’s insurance sector was valued as the 8th largest in Asia, with an annual growth rate of 4.5%. Thai residents spent approximately $334 on insurance every year, accounting for an overall penetration rate of 5.5%.

Life insurance accounts for the largest segment within the insurance industry in Thailand. These are annualized premiums paid out in the event of death or permanent disability; or after reaching a certain age. If you subtract life insurance from the overall industry pie, premiums decline considerably to $100/capita.

Photo credit: Thaire.

And this is where the largest potential for growth lies.

Thailand is already considered to be an upper-middle income country by the World Bank, with a GDP per capita of $6,033. When you combine that with a rosy economic outlook, it’s straightforward to predict that the size of motor and travel insurance will rise, too. Higher disposable incomes will lead to a greater outlay on cars and vacations – and the insurance industry is bound to benefit.

But one of the problems currently plaguing Thailand’s insurance sector is that distribution channels are antiquated and riddled with inefficiencies. To purchase an insurance plan, you normally have to arrange for a broker to meet you, prepare an unwieldy amount of paperwork, and wait for the bureaucratic red tape to churn its wheels.

The entire process is frustrating from a consumer standpoint and expensive for insurance companies too; broker commissions can eat into premiums and the process is only scalable by hiring a greater number of agents.

In 2016, a total of $5.1 billion in non-life insurance premiums were solicited via brokers, agents, and bancassurance channels. Precise figures for online distribution aren’t available, but the channel did grow by 25% as compared to 2015.

One of the startups that’s trying to simplify the insurance acquisition process is Frank. It offers motorcycle, car, and travel insurance direct to consumers in Thailand via its website. Consumers apply for their insurance product of choice, receive an instant quote, and for certain products, can have the policy in a few seconds. It’s fairly hassle-free.

Frank’s co-founder Harprem Doowa admits they’re still a small player in a very “traditional industry” but he affirms their product is largely positioned towards millennials and future Thai generations who are far more comfortable transacting online and will continue to carry these preferences along with them.

“This will take time,” he adds, referring to overall adoption of Frank’s product.

Harprem ecommerceIQ

Harprem Doowa, Co-founder and MD of frank.co.th

Innovating the insurance value chain

Another key challenge for Frank is ensuring that all parties involved in the transaction are equally adept and comfortable with technology. At the end of the day, it’s another distribution channel and isn’t inherently marketing its own product.

Frank’s policies are underwritten by companies like Bangkok Insurance and AXA – large, unwieldy, and geriatric organizations resistant to systemic change and constant reinvention.

“Insurance companies themselves are still not ready with the backend to underwrite policies immediately. Most still require manual approvals,” explains Harprem.

Another problem is that many potential customers opt out of the process because they’re unfamiliar and uncomfortable with scanning and uploading documents. They require the support of an agent or customer support advisor to complete the transaction – driving up costs and somewhat negating Frank’s value proposition in the first place.

The third aspect hampering progress in insurtech are Thai regulations: Harprem explains that while they protect consumers, there’s a real bottleneck towards online conversions because of the multiple in-person verifications required.

Value-add Partnerships

The fledgling insurtech company has experimented with a number of ways to make it more visible and enticing to customers. One of these is partnerships with popular ecommerce players like Lazada, Grab, honestbee, and foodpanda.

ecommerceIQThis may seem like a contrasting list of partners – how does quick food delivery equate to online insurance? – but Harprem is upbeat about the benefits its brought to the table.

“Doing partnerships with many companies increases our exposure 30X and when [consumers] go and search online for insurance, they see Frank. It wouldn’t be the first time and therefore they are more likely to buy from us,” he explains.

That’s a critical takeaway – startups aren’t flush with the kind of cash that large organizations have, they have to stay lean. By leveraging relationships with online companies, even something unsexy like insurtech can be galvanized into a winning brand.

“The more customers see your brand, the more likely they are to buy insurance from you at a later stage,” exhorts Harprem.

Where do the opportunities and threats lie?

Of course, it’s possible that large insurance companies eventually sidestep players like Frank and start selling direct to consumers via web channels but this will involve channel conflict.

Specifically, it will alienate the vast number of brokers who currently provide the bulk of insurance revenues. Another complication is the sheer time insurance companies take to make decisions, hampered by bureaucracy and lengthy internal approvals processes.

Harprem says the team is completely aware of this but isn’t overly worried. Frank’s nimbleness means it can continue innovating and pivoting as and when the need arises.

“It took one of our partners two years to update their home page.”

There are two additional areas which, if done right, could provide considerable value in the coming years. One is ‘microinsurance’, or insurance for low-income households that provides protection for health risks, property damage, or other specific perils.

Harprem says there’s definitely a business case for it in Thailand but adds that it’s not a priority for Frank right now.

The other opportunity is changing fintech from just another distribution channel to overhauling the entire product in itself. That’s where technologies like blockchain have the greatest potential.

In Singapore, this is already becoming a reality. Electrify, which allows users to buy electricity on the blockchain, closed a $30 million ICO yesterday. Insurtech company PolicyPal, which is powered by blockchain technology, allows underbanked consumers to purchase products like agriculture, property, life, and personal insurance.

“This, in my humble opinion is true fintech,” says Harprem.

Brands in Southeast Asia are choosing leading marketplaces like Lazada and Shopee when trialing ecommerce, but most are still unaware of the intricacies of online channels. 

An often overlooked aspect to opening an official Shop-in-Shop (SiS) is the impact of customer reviews. Traditionally, brands have leveraged sources like Nielsen or focus groups to understand consumer behavior but one of the key advantages of an ecommerce store is the ability to analyze consumer sentiment right when it happens.

How much do product reviews really matter?

A 2017 survey by Podium shows that 93% of shoppers find reviews influential when buying online. 88% of consumers trust product reviews as much as a personal recommendation, and 72% say a positive review makes them trust an online business more.

An analysis of 57 million reviews and 35 billion product pages by the Buzzplant network found that increasing the volume of reviews has a tangible effect on your conversion, SEO, and product development.

“Any business owner knows that your most authentic and impactful advocate is a happy customer, and technology has made every customer’s voice extremely powerful,” says Eric Rea, CEO of Podium.

Source: Buzzplant

Impact on SEO

The volume and recurrence of product reviews has a direct correlation to search engine SEO. Moz found in 2017 that “Review Signals” affect up to 13% of how search engines rank results.

The factors that influence SEO include review quantity, review velocity, and review diversity.

In 2013, Google implemented the Hummingbird update, the most significant change to its search engine algorithm since 2001. The new code has far greater affinity for natural language processing and user intent as opposed to the earlier practice of ranking for keyword stuffing.

With Hummingbird, we can assume that product reviews that naturally feature conversational language are given higher search priority.  

Lazada incorporates quantity of reviews and average ratings directly into its Google schema markup. In layman’s terms, this means that consumers in Southeast Asia searching for products on Google will see product ratings and reviews directly in the results.

Lazada SKUs highlight average ratings and number of reviews directly in search results

The More “Helpful” the Review, the Higher the Ranking

We’ve demonstrated the tangible effect of product reviews on conversion and visibility but how many products do consumers read before purchasing?

According to a 2017 study by BrightLocal, 67% of customers read 4+ reviews, and 33% read 11+. Naturally, they’ll read the reviews that appear first on the product page – similar to how the first page of SEO results are the most lucrative.

How does Lazada sort reviews?

The first bifurcation Lazada applies is by splitting reviews into two categories: “Verified” and “Unverified”.

“Verified” reviews are those made by customers who have purchased the product in question and leave a review using the same account. “Unverified” reviews can be made by any visitor to the product page. The “Verified” reviews rank at the top, followed by the “Unverified” reviews.

Visitors to product pages can further “like” a product review by deeming it “helpful”. The most “helpful” reviews will rank at the top, meaning visitors to product pages are more likely to interact with “verified” and “helpful” reviews first.

Data analytics platform BrandIQ delved into the trend between review “helpfulness” and its star rating. By analyzing over 715,000 reviews across four Lazada country sites (ID, TH, PH, SG), it determined that, on average, lower ratings are deemed more “helpful” than higher ratings.

This inverse relationship is a critical reason for brands to pay close attention to its product reviews. Customers are far more likely to be reading negative reviews as their first 4+ rather than positive ones due to Lazada’s ranking algorithm.

What’s the possible recourse for brands?

After speaking with a Lazada support representative, there appears to be two underlying factors that cause the marketplace to take action on product reviews: the use of vulgar language or reviews that have no relevance to the product.

The first factor can be tackled relatively easily. Lazada itself has a quality assurance process to check each product review before it’s uploaded to the product page. However, the astronomical growth of reviews has made it inevitable for some to fall through the cracks. The week of 12-12 in 2017 garnered just over 34,000 product reviews alone.

The second factor is more complicated as they are evaluated on a case-by-case basis. Lazada’s technical team will entertain petitions to remove reviews that aren’t related to the product such as issues with delivery that stem from problems with the brand’s third party logistics partner.

To incentivize better service and product quality, Lazada provides a framework to incorporate product reviews into a store’s Seller Rating. This metric looks at the percentage of positive (4 or 5 stars) reviews compared to total reviews.

Lazada advertises Seller Rewards as a gift for high Seller Ratings: such brands will enjoy greater visibility of products in search as well as access to its promotional campaigns.

Lazada’s Seller Performance Metrics

What does this mean?

In essence, product reviews have multiple dimensions and a plethora of use cases. Not only are they taken into account by channels that drive traffic to your SiS, they can make or break a product’s conversion and directly affect your brand’s perceived trust.

Some brands are also leveraging reviews for digital marketing campaigns by incorporating them directly into the ad copy.

Different use cases for product reviews are emerging in digital marketing

Reviews are an under-utilised resource in Southeast Asia, but this might be on the cusp of changing. You could always hope a gem of a review goes viral, like this one:

Asian lovers don’t seem to shy away from Valentine’s day.

According to Mastercard, 75% of mainland Chinese are likely to buy a gift for their partner on this amorous occasion, followed by 74% of Thai, and 63% of Malays and Filipinos.

They’re shelling out hefty sums too.

Chinese residents indicated they would spend an average of US$310, closely trailed by Hong Kong at US$282 and Taiwan with US$281.

Filipinos don’t spend as much as some of their other Asian counterparts, but they’re ranked as some of the most romantic in the region.

An Orient McCann study revealed that Filipinos are the most emotional people in the world and second among those who most frequently say “I love you”, making Valentine’s Day an ideal event to let their feelings be known.

Google Trends data for the past week show interest in Valentine’s Day from the Philippines reaching a zenith as we approach the day itself.

Search interest is escalating fast.

What are Filipinos searching for online? And how can brands leverage this information?

Analyzing customer preferences in The Philippines

ecommerceIQ surveyed 500 Filipinos with access to the internet in an effort to understand how they prepare for Valentine’s Day.

87.2% of those surveyed said they intend to purchase a gift to mark the occasion, whereas only 12.8% indicated that they had no plans to do so.

But it’s not so straightforward.

63.9% of survey respondents said their eventual purchase would take place offline.

Within this subset, 42.8% said both the search and purchase would happen in-store and 21.1% outlined that their purchase journey would start online by searching for products but would be followed by a visit to their local mall.

36.1% of the people surveyed said they’re comfortable transacting online, mainly because of better deals & discounts, as well as the option of scheduling delivery at a particular time.

The most popular gifts sought by Filipinos for Valentine’s Day were surprisingly clothes at number one, followed by chocolates, and perfumes.

Flowers ranked a distant fourth – likely because the price of flowers in Manila tends to spike by 500% on or right before Valentine’s Day.

There’s no real substitute for red roses but consumers have a plethora of options when it comes to clothing and perfumes, leading to price stability.

What’s preventing Filipinos from purchasing online?

According to the survey results, more than 75% of respondents exhorted that they prefer to see the product before buying it.

A further 17% said they can’t trust the quality of products they see online or that they’ve been subjected to scams. Only 5% thought malls offer better deals & discounts.

Lazada was the overwhelming favorite among those who did purchase online. Almost 60% of respondents said they’d shop for Valentine’s Day gifts from the popular etailer. Shopee came in second, with 22.2%.

Despite the fact that the most sought-after gift was clothes, pure-play fashion ecommerce site Zalora secured only 4.4% of the vote.

Photo credit: Maxpixel

Capturing love online

Filipino preferences are indicative of a larger trend engulfing global ecommerce markets.

“It’s very hard to launch a brand these days that’s just online-only,” explains Sucharita Mulpuru, analyst at Forrester Research. “It’s an incredibly difficult and crowded ecommerce environment.”

Filipino brands have consistently tried to latch on to prevailing sentiments during Valentine’s Day to either sell more products or increase brand awareness.

Popular fast food joint Jollibee launched a successful campaign last year playing on themes of unrequited love and eventual reunification.

The ads, which were released in three parts, went viral on social media with over 50 million views on Facebook alone.

Condom manufacturer DKT Health gave away nearly 40,000 condoms in Manila during the Valentine’s Day weekend in 2015 by partnering with stalls selling balloons, chocolates, and roses.

Southeast Asian brands are cognizant of this dynamic, at least in Thailand. David Jou, the CEO and co-founder of Pomelo wrote in 2016 about how he viewed offline as a key component of his business moving forward.

“[…] is our goal to be the biggest online fast fashion brand or is our goal to be the biggest fast fashion brand?”, he said, posing an apparent challenge to his team.

Brands in mature ecommerce markets have already started to take a similar route too. Zara opened a pop-up shop in London last month to support its ecommerce channel. Staff at the store were trained to assist with online orders – shoppers can walk in, examine the inventory, receive recommendations from assistants, and eventually pay for the goods they like. But all the products they purchase are shipped to their address.

For companies looking to capitalize on the visible potential and consumer intent to purchase, they’ll have to overcome the prevalent trust barrier currently impeding ecommerce. A consistent online-offline retail experience could very well be a significant first step in doing so.

One of the most attractive points of listing your brand’s products on Lazada is the ability to take part in its multitude of campaigns, accessed by thousands of customers.

Such campaigns aren’t limited in size and scope: they range from huge events like its heavily marketed Online Festival, which include 11.11 and 12.12, to smaller weekly campaigns such as the current ‘Fall In Love’ event for Valentines Day.

Not only does Southeast Asia’s largest ecommerce platform promote campaigns via large banner adverts on its main landing page, it drives traffic via paid acquisition channels and email marketing.

BrandIQ

Valentine’s Day campaigns this week include ‘Valentine Day Sale’ with Unilever in Indonesia, ‘Lazada Delivers Love’ in Philippines, and ‘Fall In Love’ in Thailand

For brands, such visibility is critical; Southeast Asian consumers increasingly use online marketplaces to begin their product journey, bypassing even search engines.

ecommerceIQ

A study by ecommerceIQ found that 57% of Indonesians start their product search on marketplaces.

Lazada promises significant internet traffic during its biggest campaigns – the 11.11 sales event attracted 10 million site visits in the first 24 hours and garnered 10 times the sales volume when compared to non campaign days.

While traffic is definitely attractive to brands, an analysis of campaign promotions by data analytics platform BrandIQ found that companies have limited control over the visibility of their products during such events.

Provided brand managers meet Lazada’s conditions of discount percentage and relevant categories, they can pitch as many SKUs as they like for campaigns such as ‘Flash Sales’ and ‘Daily Deals’. However, this only accounts for a small percentage of the ‘shelf space’ available on the Lazada campaign page with the majority of product placement within the campaign categories out of the brand manager’s control.

BrandIQ

The ‘Flash Sales’ portion of campaigns are among the few ways to boost sales of brand’s products.

Marketplace and Brand relationship

Brands shouldn’t take a hands-off role after agreeing to participate in a particular campaign. BrandIQ discovered that the maximum mileage garnered from these campaigns lean more towards promoting Lazada’s own inventory and not the brand’s official shop-in-shop (Amazon, anyone?).

Lazada holds inventory of major products, and sells it via a retail model. These campaigns offer a window for Lazada to boost sales of its own inventory.

How? BrandIQ deep dived into a current category campaign, ‘IT on Sale‘, running from February 6-9 on Lazada Thailand. The sale advertises ‘up to 70% off’ electronic category products.

BrandIQ

BrandIQ

Both the ‘Recommended Items’ and ‘Mobiles on Sale’ portions of the ‘IT on Sale’ campaign lists Lazada’s own retail SKUs over brand’s Shop in Shop SKUs.

The data indicated that the products listed under ‘Recommended Items’ were sold by Lazada. This is also the case in the sub-category ‘Mobiles on Sale’ portion – for example, all listed SKUs are sold directly by Lazada, rather than the Samsung or Huawei official stores.

Directly under ‘Recommended Items’ is another portion of the landing page titled ‘Top Brands on Sale’.

BrandIQ

Clicking on the brand’s logo takes customers to the brand’s official store, but where is the user directed after clicking the individual SKUs shown to the right of the brand logo?

BrandIQ

BrandIQ ascertained that 13 out of the 20 products listed were those sold directly by Lazada itself, rather than the official store.

This is despite the fact that official shop-in-shops offer the same product; it’s a conscious decision by Lazada to sell its own retail SKU over the brands.

Brands should pay close attention to the evolving nature of marketplaces and look to them as a way to jump into ecommerce, but not the long term game. As the ecommerce landscape becomes increasingly competitive and incentivized; companies need careful monitoring of all acquisition channels if they desire sustained growth.

 

Singaporean netizens rank at 4th place globally for sessions per year on Amazon, when judged in proportion to the number of internet users. That puts them just marginally behind Canada.

Source: SimilarWeb/World Bank

It’s probably one of the reasons why the company chose to enter Southeast Asia via Singapore; not only is there is an internet-savvy population with a high credit card penetration, consumers already have a stated preference to transact with the platform.

Amazon wasn’t physically present in Singapore until last year but the company’s white-label electronic products such as the Echo Dot and Kindle have been stocked and fulfilled by Lazada Singapore through grey market sellers as far back as March 2015, according to analytics platform BrandIQ.

Demand for Amazon in Singapore

BrandIQ mapped the number of reviews on Amazon products on Lazada SG over a three-year time period. When compared against Google Web Search data from Google Trends, there was a direct correlation between the volume of reviews on Lazada and Google search interest for Amazon from Singapore – until the marketplace’s official launch in July 2017.

Source: BrandIQ/Google Trends

Amazon products on Lazada witnessed a spike of product reviews towards the end of 2015, coinciding with the September 2015 announcement of the Fire Tablet and Fire TV product lines.

Google Trends data shows a very similar spike to that of product reviews on Lazada in December 2015, which can be attributed to the holiday season and popularity of the new Fire product lines.

A very similar trend was also witnessed in 2016; product reviews rose following the September 2016 announcement of the new Echo Dot product, with corresponding spikes in both Google Web Search and Lazada product reviews in December 2016.

Web search interest in Amazon reached a crescendo in July 2017 following the Prime Now launch in Singapore. This event also marked the first inverse trend between web searches for Amazon and product reviews on Lazada. While the number of product reviews grew approaching the December 2017 holiday season, it never recovered to 2016 or 2015 levels, suggesting decreased interest across Lazada following Amazon’s entry.

There’s a correlation between Amazon product launches and their popularity in Singapore based on reviews by certified users, but what does it mean?

Rival on Lazada’s marketplace

Despite Amazon’s belated entry into Southeast Asia, its products are still ranking high on Lazada.

The interesting part is that the products in question; Amazon Fire TV, Kindle, and Echo are simply unavailable on Prime Now and can’t be shipped to Singapore from AmazonGlobal, it’s international shipping site.

Instead, these products are sold and fulfilled by a multitude of grey sellers on Lazada such as GeekBite, that has been active on the platform for 3+ years.

Despite its Amazon Prime Now offerings for free international shipping, some of Amazon’s best selling items can’t be shipped to Singapore

There’s clear demand and interest for Amazon products, which leads us to the question: why is a customer-obsessed Amazon content with grey market sellers fulfilling this need?

Standard industry practices indicate that well-known brands often find a crowded grey market for their products to be a cause for concern. Leaving grey sellers to fulfill local demand for foreign products results in brands losing control of their brand image, as delivery, packaging, and warranties from grey sellers usually don’t correspond to the same brand guidelines adhered to by the company.

The answer here is likely linked to the outdated industry distribution rights for television/movie content on the Fire platform and e-book rights for the Kindle. Content distribution rights are negotiated geographically, and local distributors commonly have long term contracts with content producers. Amazon either hasn’t prioritized, or is still in the process of securing distribution rights for Southeast Asia, and thus can’t make these products available to purchase.

What Amazon is falling short of, grey market sellers are picking up admirably. In the electronics categories including “Tablets” and “Video” on Lazada, Amazon products rank in the Top 10 when sorting by “Popularity”. The Amazon Fire TV Stick and Amazon Kindle stand out within their own respective categories.

The prices of items like the Kindle are also marked up by almost 23% (US$79.99 on Amazon US vs US$103 on Lazada SG) and the Echo Dot is marked up by 15% (US$49.99 on Amazon US vs US$59 on Lazada SG).

Singaporean consumers itching for the new Amazon items are stuck with purchasing through grey sellers on Lazada, like local reseller SGKindleShop, who offers the Kindle for US$155, or like forwarder shipping service like comGateway, which can set you back another US$15 for the US$79 Kindle, only slightly cheaper than the US$103 price tag on Lazada.

Cost of shipping a 1kg package using a forwarder shipping service from the US to Singapore.
Prices in SGD

Amazon is missing out on a large potential revenue source by foregoing some of its best selling products on Prime Now. It’s also unable to cross-sell by offering enhanced product warranties, which are an important addition to overall product revenue streams.

Unless Jeff Bezos makes a conscious decision to include Amazon’s products on Prime Now SG, it’s going to continue to cede the market to grey sellers on its largest regional competitor.

Osman Husain of ecommerceIQ contributed to this report.


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