Lazada, Southeast Asia’s largest online shopping mall, has introduced an e-marketplace in a bid to create a new revenue stream and offer a place where sellers and shoppers can meet.
Riccardo Basile, chief executive of Lazada Thailand and co-founder of Lazada Group, said the parent originally sold products sourced itself comprising 13 categories, storing them in its own warehouses.
But now it has added a new business, an e-marketplace that allows potential sellers and buyers to meet on its website.
The expansion comes after the group raised US$250 million in funding from the British retail conglomerate Tesco Plc, the New York-based Access Industries, Sweden's Investment AB Kinnevik and Belgium's Verlinvest.
Rocket Internet, the world’s biggest internet incubator, is a major shareholder in Lazada.
With this new e-marketplace service, business operators can sell their products online while Lazada takes care of marketing, product delivery and payments.
Meanwhile, the company makes money from revenue sharing with product owners or merchants.
Some 60% of product items sold through Lazada are lifestyle or non-electronic products.
Mr Basile said the company has offices in five countries — Singapore, Indonesia, Malaysia, the Philippines and Thailand.
All five provide handsome opportunities for Lazada to reach 500 potential customers.
Thailand is a base for online marketing, while Vietnam controls IT operations. Company headquarters are in Singapore.
Mr Basile said e-commerce remains a solid growth industry in Southeast Asia on the back of the continuously rising number of internet users and the advanced mobile infrastructure.
In Thailand last year, e-commerce accounted for only 1% of total retail transactions, but it will continue to grow in the coming years thanks to internet penetration surpassing 25% and the proliferation of smartphones and tablets, he said.
To tap growth in the use of mobile channels, Lazada recently launched Android and iOS mobile apps including mobile marketing through social messaging apps such as Line and WeChat.
Currently its mobile traffic stands at 40% of total traffic.
To celebrate two years of business in Thailand, Lazada will next Wednesday kick off a special campaign with discounts of up to 90% in hopes of doubling its traffic and sales.
During these two years, the company has featured cash-on-delivery services, over-the-counter payments and a free-return policy, all aimed at gaining customers' trust.