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Taking Stock: Southeast Asia gets own online shopping festival

Online fashion retailer ZALORA and major e-commerce players in Hong Kong and Southeast Asia are rolling out today (12 December) the region’s first big online single day shopping event dubbed 12.12 Online Fever.

The cyber event, which coincides with the peak of the holiday shopping season, will offer attractive deals across fashion, food, beauty, travel and other categories.

Dione Song, Marketing Director for ZALORA Singapore, said in an interview that e-commerce players from all industry verticals across the region come together to offer customers a one-stop portal to the best promotions and most relevant offerings.

“It is a united effort with a group of like-minded partners to promote e-commerce in the region via mutually beneficial partnerships aimed at fostering consumer confidence in online transactions,” she said.

“Operational support from delivery partners like SingPost and 7-Eleven convenience stores fortify their commitment to educate consumers on the ease of online shopping by highlighting and incentivizing new and convenient pickup options that customers can enjoy today,” she added.

With POPStation, for example, customers can choose to collect or return their online
purchases from more than 70 POPStations across the island with a mobile app allowing items to be picked up even more quickly.

Song stressed that the big advantage for consumers is that it’s seamless hassle-free shopping, and there’s no more need for them to scour different websites or shops to do their festive shopping.

For retail partners the whole model and premise that the 12.12 Online Fever is built on – collaboration and co-marketing. Thus, the biggest advantage is that participating partners from a myriad of verticals are able to complement and leverage off one another, meaning more exposure, access to new customers and hopefully, more revenues for all.

Partners differ for individual markets, with each market working with partners, which are most relevant for them. ZALORA has dedicated specific landing page for the 12.12 Online Fever listing all the partners and their deals and banners placed strategically throughout the ZALORA.SG site to inform consumers of the event.

E-commerce in Southeast Asia

Citing a recent study done by Frost & Sullivan, Song explained that Singapore was the largest e-commerce market in Southeast Asia in 2013 with revenues of $1.7 billion, with potential for further expansion.

Another recent UBS study shows that more consumers in Southeast Asia are starting to frequent e-commerce sites a lot more, with metrics showing that the region’s consumers are visiting online retailers 41 times for every single visit to traditional retailers.

“While online shopping in Southeast Asia only accounts for 0.2 percent of all retail sales now, if it rises to 5 percent, the market could be worth around $21.8 billion,” Song stressed.

Although growth in the Asia-Pacific e-commerce market is currently led by China, Indonesia, and India, several other developing economies across Southeast Asia are set to spearhead e-commerce growth in the near future as internet penetration in the region approaches 50 percent.

Jose Gaztelu, Managing Director of ZALORA Singapore, said that spearheading this initiative alongside valued partners across all industry verticals with the support of the Singapore Economic Development Board, is envisioned to fuel the e-commerce
ecosystem in Singapore, and educate consumers on the beauty and convenience of online shopping,

“Our vision is for Singapore to be the leading regional hub for brands and retailers to access the growing Southeast Asian consumer market through e-commerce,” added Kiren Kumar, Director, Infocomms & Media, Singapore Economic Development Board. “Singapore is well-positioned to capture this opportunity given our vibrant ecosystem of sophisticated partners such as ZALORA, our robust IT infrastructure and availability of multi-disciplinary talent that companies can tap on to grow their ecommerce
activities.”

Beyond 12.12

With high Internet penetration across PCs, smartphones, tablet devices, strong credit card usage and a increasing disposable income levels in Singapore, ZALORA is confident that e-commerce growth in the coming years will be sustained.

“As more consumers are being converted to e-consumers, we can expect an increase in usage of smartphones in the context of a shopping experience,” said Song. “As a fashion retailer we need to be present in all the different touch points and continue to capture them while they’re on the go. These transumers are always on their mobile and are making purchasing decisions in between places.”

E-commerce explosion, especially on mobile devices, is true as well in developing countries where hard assets infrastructure is not as developed and distribution of goods are weaker.

“The mobile phone becomes more than a communication tool, it is also a platform to procure goods. At ZALORA, we are also very focused on enhancing our platform for mobile usage,” she added.

Some factors that may limit the growth of e-commerce will most likely be economic and geographical idiosyncrasies in the region, i.e., lack of access in archipelagos (need for more robust delivery operations), poor payment systems in the developing countries. But that said, as e-commerce gradually grows in the region, so will these supporting infrastructures in time.

Taking Stock is Retail in Asia’s fortnightly column dedicated to showcasing opinions from experts in the retail industry.