Online markets brace for competition

Online markets brace for competition

Jack Zhang, deputy CEO of Lazada Thailand, said his company recognises SMEs as the backbone of the Thai economy.
Jack Zhang, deputy CEO of Lazada Thailand, said his company recognises SMEs as the backbone of the Thai economy.

Online marketplaces are expected to compete intensely the rest of the year amid the economic slowdown, with new campaigns and tools rolled out to attract both sellers and buyers.

Lazada Thailand recently announced a plan to introduce its own online supermarket, called LazMart. The company decided to make Thailand its first market in Southeast Asia.

Under LazMart, which launches in September, Lazada will buy products from brands and resell them to buyers. This channel is different from the existing LazMall, where sellers run their shops online on the platform, which earns a sales commission from sellers.

Popular Thai brands will represent 80% of the marketplace, with international brands accounting for the rest.

In the first phase, dry goods will be offered, delivered to customers nationwide.

LazMart is expected to help increase the number of small and medium-sized enterprise (SME) sellers to 5.2 million, particularly those in e-commerce.

The firm also plans to work with the Business Development Department to launch a pilot project, called Smart Village Online, to train local sellers to promote their products.

The practice is similar to Alibaba's Taobao Villages campaign, which invites rural Chinese communities to sell products in the Taobao online marketplace.

Lazada also plans to organise offline activities such as fairs where sellers will be able to meet consumers directly, in parallel with online campaigns.

"Lazada will continue to invest to attract more sellers and more buyers in its platform as a priority," said Jack Zhang, deputy chief executive of Lazada Thailand. "We focus on long-term business."

From January to July, the number of sellers on Lazada doubled, with over 2 million items sold on the platform.

The number of buyers and orders rose 1.7 times and 2.4 times from the same period a year earlier.

According to the firm, the first half of the year was only a warm-up and the second half will see more major campaigns coming out.

By 2030, Lazada aims to serve 300 million customers, create millions of jobs in e-commerce and enable profitable SMEs across Southeast Asia.

Shopee and logistics

Maneerat Anulomsombut, chief executive of Sea Thailand, which operates the online marketplace Shopee, said the platform has yet to make a profit because of fierce competition in the sector.

The company vows to focus on user experience and increase the number of sellers through partnerships with the government, particularly sellers of One Tambon One Product (Otop) items.

In the second half, Shopee will launch more marketing campaigns and leverage its AirPay e-wallet.

Shopee ranks as the second-largest e-commerce app locally with 30 million downloads.

It reported US$43.5 billion in gross merchandise value in the region in the first quarter. Earlier this year, Shopee started to pilot its own logistics operation by delivering products to customers and began to gain revenue from advertisements.

JD Central and Dolfin

Rvisra Chirathivat, chief marketing officer of JD Central, said the online marketplace aims to improve platform traffic by reaching out to customers as much as possible and empowering sellers on the platform, which is a key outlet for Central Group.

E-wallet Dolfin will be integrated into the platform in September, and more innovative technologies will be rolled out to fulfil services.

Ms Rvisra said JD Central sees 80% of the orders come through mobile devices. The majority of its online shoppers are 25-45.

The most popular product categories are fashion, mobile devices, gadgets, baby items and home appliances, according to Ms Rvisra.

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