Page 69 - The EDIT | Q3 2017

Thoughtleader
Lazada describe themselves as a “One-stop shop
to access locally and internationally sourced 14.7M SKUs across 14 categories”. They have “Created an end-to-end ecosystem enabled by best-in-class logistics and payments capabilities to address
key challenges in South East Asia”. While there
are many country specific eRetailers such as Tiki (Vietnam) and Tesco (Thailand), Lazada remains
the dominant regional eRetailer. Because of this dominance, Lazada has particularly felt pressure
to revolutionize its shopping experience at the speed that Chinese retailers have. Lazada offers a Prime-like subscription service in partnership with Uber and Netflix, as well as grocery deliveries via Redmart, although, Unlike Amazon, Redmart takes a minimum of one-day to fulfill orders versus Amazon Prime’s one-hour and two-hour options.
69
eCommerce has become a major contributor to Asia-Pacific as consumers have increased their spending online. Retail eCommerce sales (except travel, restaurant and event ticket sales) ordered online will total USD 1.365 trillion in 2017, up 30% over 2016. eCommerce will account for 15% of total retail sales in Asia-Pacific this year, and will climb to 25 % by 2021 (Source: eMarketer)
The Southeast Asia market boasts all the elements that promise a flourishing eCommerce landscape — rising internet and mobile penetration, a growing
middle class with greater discretionary spending, and an increasing supply of digital platforms. Other promising indications include the fact that Thailand and Indonesia are two of the top 25 eCommerce markets globally, generating USD 2.9 billion and USD 3.2 billion respectively.
While there are very positive signs for eCommerce in SEA, the market will remain relatively small with total digital sales floating around the 2% mark of total retail figures in the region.
Low internet penetration, a developing eCommerce logistics infrastructure, low credit card usage and general distrust of digital payments are all issues that continue to challenge further growth in the region.
One of the other key reasons why Southeast Asia has not yet reached the level of sophistication in logistics and shopping experience, is that Lazada has been the only major player in the region for over 5 years. Recent data from GlobalWebIndex (Q2 2017) shows the predominance Lazada has in SEA markets with having almost thrice as many users as Amazon.
% of Online population who have visited or used LAZADA in the last month
Continued over >
THE EDIT ISSUE 7 | Q3 2017