Posts

End of year is always the busiest time for the retail industry as businesses expect spikes in sales volumes before the official holidays start.

For online players, this period has resulted in some of the most famous annual holiday shopping events such as Cyber Monday, Alibaba’s Single’s Day, and Southeast Asia’s Online Revolution.

In Southeast Asia, the holiday period holds even more significance for ecommerce players as 40% of their sales are generated during the last three months of the year.

eMarketer expects holiday ecommerce sales in the US to jump 16.6% year on year (YoY) in 2017 driven by mobile commerce and competition created by large retailers and digital marketplaces.

Holiday sales Southeast Asia

At least four top marketplaces in Indonesia are holding a shopping event on November 11 (11/11).

In a recent survey conducted by BigCommerce involving 1,000+ brands operating online in the US, around 50% modestly expect up to a 25% sales increase compared to the holiday period last year.

5.4% of businesses expect more than 100% of sales increase. Source: BigCommerce

Some have aimed even higher for good reason.

15.5% of businesses surveyed expect a more than 50% of sales increase during this sales period — even as much as more than 100% sales increase compared to last year. Why?

According to Deloitte, online channels will capture 51% of US consumer budgets this holiday.

With higher sales targets comes more preparation to ensure each part of the ecommerce value chain is ready to handle possible concerns mainly regarding sufficient inventory (50.63%) and delivery expectation (45%).

To full proof operations, over 37% of businesses in the US started planning for this year’s holiday season 1 – 4 months earlier than they did last year.

3.14% of respondents are actually participating in holiday ecommerce sales for the first time. Source: BigCommerce

A lot of preparation is placed during the last few months leading up to the sales event, which for Southeast Asia is coming as soon as this weekend — November 11.

If we look to Southeast Asia, the region has its own holiday mega-sales to prepare for – 11.11 and 12.12 – where order volumes can uplift by almost 300%.

Is Southeast Asia ready for the holiday rush?

The ecommerce markets in US and Southeast Asia draw many similarities. For one, mobile commerce has driven the region’s retail growth for the last two years given the mobile-first behavior of its young population.

There is also enough competition to drive prices down (to ridiculous amounts) and incentivise consumers to shop. Taking a quick glance at advertisements from popular e-marketplaces such as Lazada and Shopee indicate the amount of money being invested to capture consumer holiday spending.

Marketing of end year mega-sales in Southeast Asia. Source: Rappler (left), Shopee Singapore Facebook page (right)

Is your company ready?

Download the Holiday Ecommerce Sales Checklist here.

*Introducing the eIQ BrandData series that shares insights to different brand strategies online and how they’re performing on marketplaces across Southeast Asia in collaboration with data tool BrandIQ.

##

Electronics is one of the top performing categories online in Southeast Asia, especially during the holiday sales festival period when pricier items are discounted.

The BrandData series this week takes a look at the top two electronic brands on Lazada Indonesia in the Laptop category – Asus and Acer – both of which have an official shop-in-shop on the marketplace.

The performance was measured based on each brand’s search rank for the top five most popular generic keywords for Laptop discovery (according to Google Keyword Planner). The keywords are:

  • Laptop
  • Gaming laptop
  • 2 in 1 laptop
  • Laptop Umum (General Laptop)
  • Laptop Travel

If a browser uses the above keywords to search on a marketplace, products from Asus dominate four out of the five queries and account for the majority of the top 10 results.

Laptop brands Lazada

Asus products came out as #1 in the search result of the top five keywords for Laptop category on Lazada Indonesia. Source: BrandIQ

What does this mean?

Although both brands have an official shop-in-shop on Lazada Indonesia, Asus may have the advantage over Acer by listing a wider product offering online.

On its official store, Asus offers 66 SKUs consisting of 45 laptops and 21 smartphones, while Acer only has 8 products listed on its official store.

Even by taking into account the numerous unofficial merchants on Lazada that sell Asus/Acer products, which brings the total number of products to 2,000 and 1,300 for Asus and Acer respectively, offerings from Asus are still almost double that of its competitor.

And this discrepancy might be the reason why Asus products rank better on Lazada.

Laptop brands Lazada

Why does it matter?

Brand performance on marketplace search ranks is important because almost 57% of Indonesians bypass search engines like Google to go directly to marketplaces to begin their product journey online.

Online Consumer Indonesia


HOW IS YOUR BRAND PERFORMING ON SOUTHEAST ASIA’S TOP MARKETPLACES? 

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.

“Set up a website and sell goods online.” Having an ecommerce business is not as simple as it sounds. In addition to running effective digital marketing to create demand, a user friendly webstore and great customer service, what’s more important is getting the package delivered to the hands of consumer in one peace.

In this seventh week of LEAP, we introduced an overview operations of ecommerce from hiring the right people and technology to being the right leader for your organization.

1. Customer Experience is Key to Pomelo’s Brand and Customer Loyalty

SALISA LANDY, POMELO REGIONAL VP MARKETING AND PR

For leading fast fashion brand in Southeast Asia like Pomelo, it’s not trends and celebrities that drive returning shoppers but prioritizing customer experience. This doesn’t simply mean only answering customers’ questions  but taking care of even the smallest details, such as the packaging.

“Our packaging was something that got our customers excited. It [packaging] is edgy and instagram-able. It’s what our customers can post on their social media and from there, word of mouth spread.”

Ecommerce Logistics and Fulfillment

Pomelo Packaging

Another winning point for this online fast fashion brand is how Pomelo addresses the most painful point of online shopping – sizing and returns. Because selling goods online, especially fashion items, requires a good fit.

Ecommerce Logistics and Fulfillment

Salisa Landy, Pomelo Regional VP Marketing and PR

Pomelo offered a 365-day free return policy to break the online purchasing barrier of not being able to touch and trial.

Ecommerce Logistics and Fulfillment

2. A Checklist to Ecommerce Operations: Making Your Business Ecommerce Ready

MITCH BITTERMANN, GROUP CCO ACOMMERCE

When building your ecommerce backend, the frequently-asked questions often involve: Where do we start? Or what do I need to have in order to operate my ecommerce business effectively and efficiently?

Ecommerce Logistics and Fulfillment

Mitch Bittermann, Group CCO aCommerce

Mitch shared a checklist of items to make the organization ready for ecommerce.

Ecommerce Logistics and Fulfillment

3. To Lead is To Achieve Something Great Together

CARLOS FRANCAIS, COO LAZADA THAILAND

According to  the Chief Operating Officer of Lazada, to lead an organization, the leader must be able to influence and persuade his team members – especially blue collar workers – to work towards the same goal.

Ecommerce Logistics and Fulfillment

Carlos Francais, COO Lazada Thailand

In this interactive session, Carlos shared this framework to create a shared vision within the company, encouraging the team to fully address its strengths, weaknesses, opportunities and threats.

“People populate your behaviour. When employees are inspired by what you do, and in return, they are productive at their work. This is where innovation begins.”

Ecommerce Logistics and Fulfillment

The next class is on Thursday November 2nd and will dive into how to run a fulfillment center efficiently and explore the right delivery methods in Southeast Asia by the industry expert Kerry Express. Stay tuned for next week’s takeaways!

[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

Here’s what you should know:

1. Fighting counterfeit products, Shell Malaysia goes online with Lazada

Shell partnered with Lazada in Malaysia to launch an official store to sell motor oil products online.

Customers from throughout the country can now order the motor oil products on the Lazada Malaysia store. The company hopes the access will help deter the sale of counterfeit products.

Shell will also provide engine oil service packages in its online store for customers at selected authorised workshops in the Klang Valley and Johor.

Read the full story here.

2. Ofo launches its bike-sharing service in Malaysia and Thailand

Ofo introduced its service in Malaysia after lowkey launched its service in Thailand earlier this week.

In Malaysia, the company is running a trial phase in Melaka city center, where during the period each ride will cost $0.23 per hour, and users will not have to pay a deposit as would usually be the case. The trial will last until August 20.

Ofo already has 500 cycles in the downtown area, with a plan of deploying another 1,500 set by the end of this month.

The company will compete with Singapore’s Obike who also has presence in Malaysia and Thailand.

Read the full story here

3. Financial statements reveal EMTEK’s minority shares in Grab

One of Indonesia’s largest media conglomerat EMTEK is said to have a minority investment in Grab as revealed in the recently released company’s quarterly financial statement.

The financial statements mentioned that EMTEK owns 1.684.445 (0.003%) shares in the ride-hailing app that was made through its subsidiary KMK.

The company is also confirmed to have sold 25% of its stakes in Kudo following the company’s acquisition by Grab.

Read the full story here.

[Updated July 27 11:12am]: A light version of Amazon Prime, Prime Now has become available in the App Store for Singaporeans (previously only a redirect) as well as the website is live: https://www.amazon.com.sg/primenow.

Updated July 26 6:23pm]: The Amazon Prime Now app has become available to download in Singapore (Prime Now is the two-hour delivery service for Prime members meaning). It can only be downloaded through primenow.amazon.com redirect.

Amazon in Singapore

Amazon Prime Now app now available for download in Singapore.

Amazon in Singapore

Available inventory for Amazon Singapore Prime Now.

Recent headlines, first reported by TechCrunch, say that the US retail giant is finally (finally) coming to Southeast Asia, Singapore first.

There hasn’t been any official word from Amazon as the company told e27 it would not comment on speculation.

Taking a look at the Amazon website for job postings in Singapore also hasn’t given any further signs of an aggressive hiring spree for local retail employees though it would be wise to keep an eye for updates.

So what points to the retailer’s confirmation landing in Singapore?

Social media influencers.

Popular accounts such as “theramengirl” and “superadrianme“, each with thousands of followers have posted sponsored photos in the last week alluding to Amazon’s Prime service soon to be available in Singapore.

Amazon in Singapore

Source: superadrianme

Amazon in Singapore

Where could that familiar ‘a to z’ blue packaging be from? Source: theramengirl

Impact of Amazon in Singapore

Everyone, e-marketplaces and traditional retailers alike, has been holding their breath ever since the circulation of Amazon’s Singapore Q1 launch rumours began in November 2016.

It’s not wrong to be worried if one has followed the disruption caused by Amazon in the US retail industry. Brick and mortar businesses have filed for bankruptcy, 25% of shopping malls in the US are expected to shut down by 2022, and brands (Nike) that were likely to never go ‘marketplace-strategy’ have hopped onto The Everything Store to gain control over third-party pricing and distribution.

In Southeast Asia, ambitious plans to build more stores in the next five months by retailers in Thailand may slow down. Service providers, namely logistics players with strong regional networks, are ready to offer a helping hand in Amazon’s initial business growth but should stay weary if the giant plans to replicate its impressive logistics network in-house in the region.

Alibaba has recently doubled down on its Southeast Asian efforts by investing another $1 billion in Lazada for 83% stake and rumoured to be competing with JD.com Inc to lead a funding round in Tokopedia, one of Indonesia’s largest marketplaces.

JD.com Inc, China’s number two ecommerce player has also announced plans to enter Thailand by end of the year to increase their regional footprint.

Lazada, arguably the leading online retailer in Southeast Asia, began offering a Prime-like membership program called LiveUp in April in hopes of keeping customers loyal.

Sign-ups for the program have been quite healthy, tells a source from Lazada to eIQ.

Aimone Ripa di Meana, co-founder and Chief Marketplace Officer at Lazada, recently commented that Lazada was confident about its position in the region.

“It’s not an easy balance [being local and nimble], but it’s something that we’ve invested a lot of time to get to and I don’t think it’s acquired or built in a day,” says Aimone.

Shopee, another strong contender affected by news of Amazon’s arrival, has also been quite active in strong arming its retail strategy. The once only C2C marketplace announced “Shopee Mall” earlier this month, a new in-app platform that follows the same Lazada B2C model and already offers products from over 200 brands.

Shoppers can enjoy free shipping with no minimum spend and a 15-day return policy when they make a purchase. But will it all be enough?

Survival in one of the last battlegrounds Amazon has not yet stepped into will boil down to which company has successfully created a loyal fan base by fulfilling promised perks of fast shipping, cheap prices and an endless assortment of products.

These are already the cornerstones of Amazon thanks to Bezos’ long-standing and highly touted ‘customer obsession’ and what will ultimately give them an advantage in acquiring shoppers without any heavy marketing

For those holding their breath, it’s time to let it go because the “Amazon Effect” is coming.

Amazon in Singapore

And you’re done. Source: Flickr


Join the ecommerceIQ Network to receive ecommerce insights here.

Here’s what you should know today:

1. Alibaba-backed Grana takes aim at Mainland China

Hong Kong online fashion retailer Grana has expand to mainland China via an official store on Tmall. The company has recently scored a $10 million series A funding led by the Alibaba Entrepreneurs Fund.

Grana built a name for itself in the online fashion industry by cutting out the middleman – it manufactures and sells clothes directly to customers. It allows them to reduce the cost the prices for clothes made out of expensive fabrics such as silk or cashmere.

The company expects China to be its next biggest market after the US.

Read the full story here

2. Flipkart raises offer to buy Snapdeal for $850 million

Flipkart revised its bid for Snapdeal to $850 million after its initial offer of $600 million was rejected. In an unexpected turn of event, however, Ahmedabad-based ecommerce Infibeam has jumped into the fray with a proposal to buy for $1 billion.

Founded in February 2010, Snapdeal was the second biggest ecommerce company after Flipkart until 2015. It was valued US$6.5 billion when it raised funding early last year. The company began to crash after Amazon’s entry to the country.

Read the full story here

3. Shopee launches Shopee Mall, expands to B2C space

Shopee has launched Shopee Mall, a dedicated in-app space for B2C sellers. This portal is separate from the regular Shopee marketplace and provide access to products from brands such as 3M, L’Oreal, Philips and Reckitt Benckiser.

All products listed on the Shopee Mall are guaranteed to be authentic. Shoppers can easily identify Shopee Mall product listings with the newly added red ‘Mall’ label.

Within the portal, shoppers can also navigate easily between key brands, category campaigns and personalised recommendations.

Shopee Mall aims to bolster both attributes and assure consumers by ensuring that all sellers on Shopee Mall are verified with the Accounting and Corporate Regulatory Authority, a locally registered entity.

Read the full story here