Written by EternusGlobal

Can Philippines Ecommerce Thrive? Lessons from Lazada Philippines

When Southeast Asia’s largest online retail site Lazada Philippines established their online store in the Philippines in 2012, it was not in a fine position to say that indeed ecommerce can thrive.

Credit card penetration is beneath four percent, and internet speed and buying power are much lower than the more developed countries of Southeast Asia. There are also challenges with logistics within 7,100 islands.

It does, however, have an internet savvy population consisting of over a hundred million who want to take part in an online revolution. Philippines used to be referred to as the texting capital of the world, then after a while, it was known as the social media capital.

For quite a lot of reasons, Rocket Internet, the company that owns Lazada accepted the challenge and launched the Lazada.com.ph portal, together with four other local sites in Indonesia, Malaysia, Thailand and Vietnam.

It holds a promise to Philippine shoppers: no traffic jams, no crowds or lengthy queues at the department stores. This idea resonated well with customers that have not been impressed with the nation’s infrastructure shortage. Philippines was a country simply waking to the world of convenience being furnished by the internet, and it was also a potential gold mine.

Nevertheless it’s not simply the company who jumped into the unknown, but also a young London-centered Turkish banker who was soon known to be Lazada Philippines co-founder and CEO Inanc Balci. Previously, before coming to the Philippines, he has been announcing in media interviews that he knows nothing about the nation, which may be an advantage to him.

The calculated chance paid off. In these days, Balci is proudly raving with regards to the portal’s achievements – the website averages 81 million visits in a month, it’s mobile platform has surpassed 20 million app downloads in Southeast Asia. But the most important of all is the ranking. Lazada Philippines is now the sixth most visited internet site within the Philippines after Facebook, Youtube, Google.com.ph. Google, and Yahoo.

Potential Strengths

Sixty percent of Lazada purchasers already shop through mobile, according to Balci, which he sees as a clear indication of how Lazada has efficiently adapted to trendy Filipino digital habits.

The website online has additionally given a big possibility for SMEs within the ecommerce enterprise. It currently has over 7,000 retailers on board, and Balci mentioned Lazada will continue to make enhancements in its retailers’ platform to inspire more entrepreneurs to promote their goods online.

The nation’s largest brands and outlets also have a large presence on Lazada. These include Samsung Electronics, Intel, Microsoft, Timex, Cherry Mobile, Alcatel, Nestle, P&G and Unilever. Lazada claimed to collaborate intently with the biggest brands to present various assortments and prices, which has made Lazada a major destination for every online customer. The newest amongst these partnerships is with the nation’s largest retailer, the SM Store.

Viewers who come to Lazada Philippines don’t always buy, they use the internet site as a reference site. Balci, nevertheless, sees this as a possibility instead of a setback. They come to the internet site to verify the product they have used so manufacturers and partners can also use the platform as an advertising channel.

Challenges

With the country’s complicated geography, the biggest undertaking in doing ecommerce within the Philippines is definitely logistics. Lazada has 700 vehicles these days and 19 hubs. Of its 2,200 workers, the majority also works within the logistics part of the trade. This is not shocking because it has to deliver some 20,000 products each day throughout the nation.

The company recently unveiled a new 30-square meter Fulfillment Center, which is double the capacity of its previous warehouse, and has computerized aspects for stock, determination, parcel movement and dimensional weight measurement. Lazada Express, which now covers 58 percent of the Philippines, may even be opening 20 more hubs in the course of the country to increase delivery.

Lazada Philippines sees the continued development of the market and is clearly expecting more rivals to join in. The more rivals there are in the market, the bigger that market will grow. More businesses will do online advertising and marketing and can communicate with more buyers who will soon turn into ecommerce customers.

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