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E-commerce surges in Southeast Asia

By YANG HAN in Hong Kong | CHINA DAILY | Updated: 2020-11-25 07:35
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Television hostess Rungnapa Nuymuang promotes Chinese products by livestreaming on the Lazada platform in Bangkok, Thailand. [Photo/CHINA NEWS SERVICE]

New players eye wide range of opportunities

Leading international online marketplace Lazada made the most of the Singles Day shopping extravaganza this month, cashing in on the e-commerce boom in Southeast Asia during the pandemic.

This year, the annual Nov 11 buying bonanza came with the e-commerce industry in the region enjoying rapid growth as the contagion and related lockdowns accelerated the digital shift in consumption.

This is in sharp contrast to many other industries, which are reeling from the unprecedented economic pressure caused by COVID-19.

Jessica Liu, co-president and regional head of commercial at Lazada Group, said that in the second quarter of this year, orders on Laz-Mall, Lazada's business-to-customer virtual shopping platform, more than tripled year-on-year. Alibaba invested in Lazada in 2016 and acquired control of the company.

"In the past six months, we have seen an increase in new brands and sellers adopting an online retail approach, from food and beverages, to hospitality, recreation and personal services, as leading global and regional brands give their retail mix a digital overhaul," Liu said.

Since the pandemic emerged, the number of brands handled by Laz-Mall has tripled to more than 18,000 international and local names across the region, according to the company.

Many well-known department stores and malls, including Metro and Robinsons in Singapore and the Siam Center in Thailand, have also hopped on the digital bandwagon to help their tenants set up virtual storefronts through Lazada's platform.

In particular, Liu said the grocery sector has experienced exponential growth since the start of the pandemic.

For example, when Singapore raised its Disease Outbreak Response System Condition to the second-highest level of "orange" on Feb 7, that weekend, Lazada's grocery arm RedMart saw a threefold rise in the average number of weekly orders.

On Nov 11 this year, Lazada even invited South Korean actor Lee Minho to be its first regional ambassador. It attracted more than 40 million users during its Singles Day sale, with its sales surpassing $100 million soon after the promotion began at midnight, less than half the time it took to reach this figure last year, according to the company.

The concept of the Singles Day online shopping festival was first promoted by Chinese e-commerce platforms and was introduced to Southeast Asian markets by Lazada in 2012.

The company is just one of many in the region's e-commerce industry to benefit from the pandemic.

In the first half of this year, the average value of an order throughout the region rose by 23 percent year-on-year to $28.50, according to a report by e-commerce aggregator iPrice, which is based in Malaysia. The biggest gains-57 percent and 51 percent respectively-were made in the Philippines and Singapore, according to the report, which was produced in collaboration with SimilarWeb and App Annie.

Shopee, which is based in Singapore, was the most-visited e-commerce platform in the city-state as of the second quarter, the report said. From the first quarter to the second, the company saw an 82 percent rise in the number of users, garnering close to an additional 5 million visitors on average in the second quarter alone.

In Indonesia, management consultancy RedSeer forecast that the gross merchandise value, or GMV, of the country's e-commerce sector would grow by 50 percent year-on-year to reach $35 billion this year and would rise to $101 billion by 2025.

Tokopedia, based in Jakarta, the Indonesian capital, and also backed by Alibaba, said in a statement early last month that food and beverage sales have nearly tripled during the pandemic. The company also found that the "new normal" of working and learning from home triggered a significant rise in sales of books and computers.

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