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Here’s what you should know today.

1. Financial comparison site Moneysmart raises $10m series B to grow into new markets

Singapore-based financial products and services comparison site Moneysmart has raised US$10 million for its series B round.

The round is led by Japanese web group Kakaku, which operates a number of consumer websites in sectors like shopping, travel, lifestyle, and real estate.

Moneysmart helps users compare 17 different personal finance products including credit cards, insurance, and loans. Site visitors can also read about various financial topics on the accompanying blog, maintained by full-time staff.

The startup competes with fellow Singaporean company GoBear, which also offers insurance, credit card, and loan comparison, and is present in six markets in Southeast Asia. Kakaku, a prominent Japanese online brand, sees Moneysmart as an opportunity to tap into consumer markets in Southeast Asia. “Our missions are very similar – help with people’s decision-making,” says Genta Sugihara, senior executive officer for Kakaku’s corporate development division.

Read the rest of the story here.

 

2. For retailers, Amazon is a true frenemy

“They buy from us, but they want to sell advertising to us as well,” said one brand marketer. “When you talk to them, you don’t know what their interest is.”

Amazon could be poised, according to Forrester analyst Collin Colburn, who published research on this in January, to take over search — a market Google almost wholly controls.

As consumer behavior shifts to be more specific, people will start searching on Amazon for specific needs. Amazon has created product display ads and other types of search products already.

At the same time, if brands want to be Amazon for the purpose of using only its marketing (which buyers and brands both say is good), then they also have to be on its marketplace. “Amazon is two-way relationship,” said one marketer.

Read the rest of the story here.

 

3. Recommended Reading: Why Bike-Sharing (Ofo, MoBike) Is Nothing Like Didi and Uber (i.e., Ride-Sharing)

Basically, bike-sharing is nothing like Didi, Grab, Ola, Uber, AirBnb and the others. Its economics are far more like an on-demand rental business or a vending machine business (at this point. It could evolve).

But much of the current excitement seems to be because people think this business is like Didi. It’s just not. It’s a different thing.

Bike sharing is basically a traditional, vertically integrated b2c rental service. It is a traditional merchant business. Being bigger helps somewhat but it is still fairly easy for a new entrant to enter. All you would need is about 30,000 bicycles. That would cost about $2.5M. So this is a cheap and fairly easy business to enter, which will probably limit long-term profitability.

However, in the short-term companies like Ofo and Mobike should do really well. They are offering an innovative new service and are first-movers in a wide-open and massive market.

Read the rest of the story here.

As retail preferences continue to shift in favor of online shopping, retailers are facing pressure to keep up with the latest technology to stay relevant to their customers’ expectations.

However, expanding business online is proving to be difficult and retailers are often faced with many challenges, be it from external or internal factors, that hinder efforts to provide a satisfying omnichannel experience.

What is the challenge these retailers are facing? And what can they do to improve their omnichannel experience? PwC has shared its latest insights based on a survey conducted globally to help the retailers make the digital leap.

What channels are retailers using to generate sales?

In addition to the offline store (79%), a website is the next popular platform for 73% of retailers to sell products.

Meanwhile, unsurprisingly mobile apps (24%) have become the next channel to reach a wider audience.

21% of retailers around the world are still using catalogs to promote their products and as much as 18% of retailers are still dependent on a call center.

improving omnichannel experience

What are the challenges to creating an omnichannel experience?

30% of the retailers surveyed stated ‘budget constraints’ as their biggest challenge.

Many of them don’t come from a global household name and find it challenging to devote their limited resources to manage another channel.

They also have to face challenges branching from the existing system. 13% of the leadership team doesn’t consider omnichannel as a priority and many are resistant to the idea of changing their legacy system (21%). Even when they are willing to, they find it difficult to integrate (20%).

The lack of talent and expertise in the field (16%) continue to be another bottleneck in online retail.

improving omnichannel experience

What can retailers do to improve?

With limited resources, retailers need to have smarter strategies to optimize budgets and reach the right audience. Omnichannel is not about favoring one over the other, it’s about the synergy of different channels to create a more satisfying customer experience.

A smarter strategy comes down to two things:

  • Mobile website, not app

Although in-store is still the most common channel for people to shop, mobile is an increasingly popular way to browse and shop and will continue to gain popularity in the future.

improving omnichannel experience

Keep in mind, a mobile strategy doesn’t necessarily mean investing in an expensive app, retailers can focus on improving their current website to be mobile-friendly.

The mobile app is becoming an unpopular method of reaching people as more individuals feel reluctant to download another application that they will not use regularly.

By making sure the mobile version of a website is easy to use and intuitive for both browsing and shopping – making sure the checkout and payment process is smooth-, customers will have a better experience with your brand.

  • Optimize in-store experience

The offline store is not going away anytime soon, people still want the physical experience of seeing the product before buying it.

This may be an advantage that traditional retailers have that pure-play online player doesn’t but the survey showed that there are many customers who feel unsatisfied with their in-store experience.

improving omnichannel experience

Training the sales associates to have a deep knowledge of the product range is a worthwhile investment as 78% of shoppers feel it’s an important experience to have in-store.

The ability to check inventory real-time is integral – i.e. knowing when an item will be back in stock – as customers coming to the store suggest an immediate need for the product. Shoppers are also craving a personalized experience when they’re visiting an offline store – this has been found to be especially true for luxury brands.

By using technology such as an integrated data platform for offline and online channels, customers can easily access inventory information and pick up their online purchases in the nearest store. Collecting this data also allows retailers to create a more personalized in-store experience with each customer visit.

PwC’s report can be found here.

Singapore is the most mature ecommerce market in Southeast Asia where 60% of respondents report shopping online. Singaporeans also spend the most online in the region – on average a shopper purchased online goods worth $1,022 in 2016.

Statista data shows that Singapore’s ecommerce market is expected to increase from $3.3 abyillion this year to $5.1 billion in 2021 growing annually by 11.2%. And the number of online shoppers is forecasted to rise from 64.8% of the population in 2017 to 80.9% in 2021.

Which categories present good opportunities in Singapore’s ecommerce market in the near future?

Singapore ecommerce outlook

Singaporeans mostly shop online for electronics & media

Electronics & media is currently the leading ecommerce vertical in Singapore, similar as in Thailand. It’s predicted to remain as such in the near future, Statista data shows.

  • Electronics & media ecommerce market in 2017: $918 million or 27.6% of total ecommerce revenue
  • Electronics & media ecommerce market in 2021: $1.345 million of 26.5% of total ecommerce revenue
  • Annual growth rate (CAGR): +10%
  • Market’s largest segment: Consumer electronics with a market volume of $679 million in 2017

Currently, there aren’t many players in Singapore who sell online physical media (e.g. books, DVDs, games), consumer electronics (e.g. TVs, stereo systems) and/or communication devices (e.g. computers, smartphones, tablets).

The annual growth rate of online sales in this category is not the fastest, but ensures that in five years time, more than one fourth of all projected online sales in Singapore will come from selling TVs, computers, books and other devices and media.

Furniture & homeware to grow the fastest

This vertical is expected to grow by nearly 15% annually within the next five years from 2017.

  • Furniture & appliances ecommerce market in 2017: $452 million or 13.6% of total ecommerce revenue
  • Furniture & appliances ecommerce market in 2021: $782 million or 15.4% of total ecommerce revenue
  • Annual growth rate (CAGR): +14.7%
  • Market’s largest segment: Furniture and Homeware with a market volume of $317 million in 2017

Selling online furniture and household goods such as kitchen and bathroom accessories, textile furnishings will account for nearly half of the market volume in this vertical.

Below is a few examples of companies currently selling products in this vertical.

Some local players like Horme and Star Living are already seizing this opportunity whereas global giants like Ikea have not yet taken advantage but will most likely move online.

Fashion to become the second largest vertical

Fashion ecommerce in Singapore is expected to have the second highest annual growth rate following furniture. This will make fashion the second largest vertical by sales by 2021, up from the third largest vertical in 2017.

  • Fashion ecommerce market in 2017: $769 million or 23.2% of total ecommerce revenue
  • Fashion ecommerce market in 2021: $1.243 billion or 24.5% of total ecommerce revenue
  • Annual growth rate (CAGR): +12.7%
  • Market’s largest segment: Clothing with a market volume of $584 million in 2017

The fashion ecommerce vertical is unsurprisingly quite crowded in the Lion City. From local marketplaces such as Reebonz and Megafash to local brands like Charles & Keith and global brands like Uniqlo, many have already added online to their sales channel to be where their customers are – in the digital environment.

Hobby and stationery products are big in Singapore ecommerce

Selling toys, baby items, sports and outdoor products, and stationery online is also a big market in Singapore. It is projected to be the third largest vertical in sales by 2021 making up 23% of Singapore’s total ecommerce.

  • Toys, hobby & DIY ecommerce market in 2017: $844 million or 25.4% of total ecommerce revenue
  • Toys, hobby & DIY ecommerce market in 2021: $1.178 billion or 23.2% of total ecommerce revenue
  • Annual growth rate (CAGR): +8.7%
  • Market’s largest segment: Hobby & stationery (e.g. musical instruments and office supplies) with a market volume of $529 million in 2017

Food & personal care to grow 55%

This category is expected to grow to $528 million within the next five years. Although it is the  smallest of all verticals in terms of sales, it is still projected to produce a steady annual growth rate of nearly 12% in the period from 2017 to 2021.

Singapore’s online grocery segment is quite advanced compared to other Southeast Asian countries, while there are limited numbers of beauty online sellers.

  • Food & personal care ecommerce market in 2017: $339 million or 10.2% of total ecommerce revenue
  • Food & personal care ecommerce market in 2021: $528 million or 10.4% of total ecommerce revenue
  • Annual growth rate (CAGR): +11.7%
  • Market’s largest segment: Personal care with a market volume of $231 million in 2017

Looking ahead

Although the country’s ecommerce growth is not the fastest projected in the region, an online shopper in Singapore is expected to spend on average $1,234 in 2021, according to Statista. This stands to be three to four times more than annual online shopping spending in Indonesia and Thailand, nearly 10 times more than in Malaysia, 13 times more than in Vietnam and 26 times more than in the Philippines.

Here’s what you should know today.

1. Indonesia’s Go-Jek raises $1.2 billion led by Tencent

The deal, which we understand was signed last week, values the company at $3 billion post money. It is expected to be officially announced “soon.”

Go-Jek raised $550 million as recently as August 2016, when it commanded a valuation of $1.3 billion so this new deal has pushed that figure up considerably over a short period of time

Go-Jek claims to have over 200,000 drivers across some 25 cities in Indonesia. It started out as a pure bike taxi player, but it has since expanded into four wheels with its GoCar private car service and a partnership with taxi firm Blue Bird.

The region’s ride-sharing market itself is predicted to grow from $2.5 billion in 2015 to $13 billion by 2025, according to a report co-authored by Google. Indonesia’s share of that segment is forecast to jump from an estimated $0.8 billion to $5.6 billion over that same period.

With the funding, Go-Jek will be valued at $3 billion.

Read the rest of the story here.

 

2. Facebook’s express Wi-Fi launches commercially in India

In India, Facebook is currently working with a number of local ISPs and 500 local entrepreneurs, but that number is about to grow.

The company previously launched the service commercially in Kenya and it’s also trialing it in Tanzania, Nigeria and Indonesia.

, the challenge of expanding the service to other countries isn’t so much technical as it is about understanding the local markets and needs. Chances are, though, that we’ll soon see more commercial launches in the other countries where Facebook is already testing the service.

Read the rest of the story here.

 

3. Recommended Reading: Walmart Ecommerce chief says there’s more work to do

When asked about the fate of mall-based retailers, including Sears and Macy’s, Marc Lore said he thinks the retail sector is still “fairly healthy” but that some brick-and-mortar brands may not survive over the long haul.

“There’s a chance that we will see some definitely not make it,” he said. “It’s not easy to change and adapt when things are moving really fast — you have to stay on top of it, and not everybody is. People are changing the way they shop, and companies that are able to adapt will do well and flourish. Those that don’t, won’t.”

Read the rest of the story here.

Thailand’s ecommerce market has long been projected by Google and Temasek to become the second biggest in Southeast Asia after Indonesia by 2025 capturing nearly 13% of the market.

Online retail in the country is forecasted to reach $5.31 billion in 2021, an increase 1.8 times from a projected market volume of $2.95 billion in 2017.

But which categories are projected to have the largest sales? And which one will see the fastest growth in the next few years?

Thailand's ecommerce market outlook

Electronics & media ecommerce sales lead online shopping

Electronics & media is currently the leading ecommerce vertical in Thailand and will remain as such in the medium term as shown by Statista data.

The vertical includes the online sales of physical media (e.g. books, DVDs, games), consumer electronics (e.g. TVs, stereo systems) and communication devices (e.g. computers, smartphones, tablets).

  • Electronics & media ecommerce market in 2017: $1.25 billion or 42.5% of the total ecommerce revenue
  • Electronics & media ecommerce market in 2021: $1.77 billion or 33.4% of the total ecommerce revenue
  • Electronics & media ecommerce revenue 2021 vs 2017: +40%
  • Annual growth rate (CAGR): +9.1%
  • Market’s largest segment: Consumer electronics with market volume of $834 million in 2017

Currently, there are only a few players in Thailand that have specialized on this vertical: JIB, Advice, Power Buy, IT City, Banana Store, Munkong Gadget and HP.

Apart from consumer electronics stores, book shops Asia Books and Kinokunya also sell physical media through their own online stores.

While it is the largest ecommerce vertical, its revenue growth pace is projected to be the slowest among other verticals within the next five years.

Apart from specialized ecommerce stores, businesses planning to sell electronics & media should note that online marketplaces also serve as popular sites to purchase such gadgets from.

51% of online buyers reported buying a mobile phone on a marketplace.

Brands opting to sell on a marketplace have a variety of tools available to increase traffic and conversions for their shop-in-shop.

Fashion ecommerce revenue to grow the fastest

Fashion ecommerce sales are projected to increase 2.5 times within the next five years, the fastest among verticals. Fashion is and will remain the second biggest vertical by ecommerce revenues in the medium term.  

  • Fashion ecommerce market in 2017: $525 million or 17.8% of total ecommerce revenue
  • Fashion ecommerce market in 2021: $1.31 billion or 24.7% of total ecommerce revenue
  • Fashion ecommerce revenue 2021 vs 2017: +149%
  • Annual growth rate (CAGR): +25.6%
  • Market’s largest segment: Clothing with a market volume of $345 million in 2017

12% of consumers in Thailand buy clothing & footwear on a few specialised fashion online retailers. The opportunity offered in the country has recently been noted by big global players like Uniqlo and Zara that have opened brand.com stores. It is only a question of time when other big players will follow online.

A large portion of consumers – 25% – shop for fashion on social networks like Facebook, Instagram and chat app LINE.

More demand for toys, hobby and stationery products

Selling online toys and baby items, sport and outdoor products, garden products, hobby and stationery (e.g. musical instruments and office supplies) offers another opportunity for businesses in Thailand.

This vertical is expected to double to $1 billion within the next five years. The good news is there are only a handful of online retailers targeting moms & babies (Orami) or selling office supplies (OfficeMate and Somjai).

  • Toys, hobby & DIY ecommerce market in 2017: $506 million or 17.2% of total ecommerce revenue
  • Toys, hobby & DIY ecommerce market in 2021: $1.03 billion or 19.4% of total ecommerce revenue
  • Toys, Hobby & DIY ecommerce revenue 2021 vs 2017: +103%
  • Annual growth rate (CAGR): +19.4%
  • Market’s largest segment: Hobby & stationery with a market volume of $270 million in 2017

Furniture & appliances to grow steadily

The market projections foresee more Thais will go online to buy furniture and home appliances in the future as the market of this vertical is expected to grow by 80%. Local names such as Index Living Mall, Home Pro and SB Design Square are already pursuing omni-channel strategy having both online and offline shops to reach their customers.

  • Furniture & appliances ecommerce market in 2017:$475 million or 16.1% of total ecommerce revenue
  • Furniture & appliances ecommerce market in 2021:$855 million  or 16.1% of total ecommerce revenue
  • Furniture & Appliances ecommerce revenue 2021 vs 2017: +80%
  • Annual growth rate (CAGR): +15.8%
  • Largest segment: Home appliances with a market volume of $259 million  in 2017

Food & personal care

This vertical is the smallest compared to the others and includes sales of food and beverages, cosmetics, pharmaceutical and medical products. However, its predicted annual growth rate of more than 16% suggests a strong demand in the next five years.

  • Food & personal care ecommerce market in 2017: $186 million or 6.3% of total ecommerce revenue
  • Food & personal care ecommerce market in 2021: $340 million or 6.4% of total ecommerce revenue
  • Food & Personal care ecommerce revenue 2021 vs 2017: +83%
  • Annual growth rate (CAGR): +16.4%
  • Largest segment: Personal care with a market volume of $121 million in 2017

Looking ahead

Thailand’s ecommerce market as a whole is expected to grow with an annual growth rate of nearly 16% in the next five years and online spending per user is expected to nearly double.

Those who buy online on average this year are also expected to spend $243, whereas in 2021, it is projected that every fourth Thai will buy online and on average spend $382. The future looks bright.


Join the eIQ Network for more exclusive content here.

Here’s what you need to know before starting the weekend.

1. Confirmed: Amazon is coming to Australia

The US online retail giant is going down under in a big way.

Amazon is actively looking for a warehouse to become a fulfillment center, the first of many in Australia, with floor space of up to 93,000 square meters. Amazon will also start hiring to add hundreds more to the 1000 employees already in Australia

The brief statement said:

“Amazon Web Services launched an Australian region in 2012, we launched a Kindle store on amazon.com.au in 2013 and we now have almost 1000 employees in the country. We are optimistic that by focusing on the things we believe customers value most — low prices, vast selection, and fast delivery — over time we’ll earn the business of Australian customers.”

“The next step is to bring a retail offering to Australia, and we are making those plans now.”

In Australia, Amazon is already selling entertainment, including ebooks and Amazon Prime streaming of television series and movies.

The next stage is local ordering and local delivery of goods from and within Australia.

Read the rest of the story here.

 

2. iFlix will produce original content in Southeast Asia

iFlix announced today it’s going to produce its own original content in the vein of its US-headquartered competitor. Its first original TV show is called Magic Hour, a spin off from an Indonesian film.

iFlix is also planning a comedy series and has inked a deal with Malaysian studio Skop Productions to stream its movies less than a month after they’ve left cinemas.

Read the rest of the story here

 

3. Chinese ecommerce giant JD plans shift into offline retail

JD.com plans to open more than 1 million JD convenience stores across the country in the next five years, with half of them located in rural areas.

Owners of the stores could order goods, including consumer electronics, home appliances, clothing and home furnishings through JD’s application software. JD will be responsible for logistics and distribution to the stores, according to the company.

 Jason Yu, general manger of consumer research firm Kantar Worldpanel, said: “The network of stores will help JD to enhance its O2O presence in the fast-moving consumer goods sector. To address the last-mile delivery challenge, the move can help consumers to order products at nearby stores.”

Read the rest of the story here.

 

4. Recommended Reading: The book of V-Commerce

Andy Dunn, founder of online retailer Bonobos writes about digitally native vertical brands.

The v-commerce brand requires the commercialization of an e-commerce channel, but that channel is an enablement layer — it’s not the core asset. VC’s sometimes think these should be valued like technology companies.

Some of the valuations still reflect this misguided notion. These are retailers, not tech companies.

Read the rest of the story here.

 

Events

InternetRetailing Expo Indonesia 2018 is your opportunity to transform your retailing business. Taking your business ‘online’ promises increased sales, international customers and a more engaged, loyal customer base.

If you are looking to progress from offline to fully-fledged online retailer, then you need to learn the lessons from retailers across ASEAN that have tried, failed and succeeded in a wealth of aspects of online retail.