Click WARS: May the best platform win

[rooster59]

Click WARS: May the best platform win 

By Asina Pornwasin 
THE NATION WEEKEND

 

 

e-COMMERCE GIANTS’ RIVALRY WILL INTENSIFY IN 2019, WITH INVESTORS  JOINING THE BATTLEGROUND AMID HEADY SALES GROWTH IN THAILAND

 

E-commerce in 2019 is expected to flourish in Thailand as giant e-marketplace providers and huge social media platforms battle it out. Investors are expected to join the battlefield, laying their bids in front of payment and logistic players in e-commerce.

 

According to a study by Google and Temasek, 2018 was the year of e-commerce for Southeast Asia and Thailand could boast the fastest growth. The study, “e-Conomy SEA 2018: Southeast Asia’s Internet Economy Reaches an Inflection Point”, also found that e-commerce adoption had accelerated the most in Thailand, reaching nearly US$3 billion (Bt97 billion) this year after having tripled in two years – and the Kingdom was the second-largest e-commerce market in the region.

 

Thailand’s e-commerce is expected to grow at 30 per cent yearly from 2015 to 2025 to reach $13 billion (Bt421 billion). However, in 2018, Thailand’s e-commerce actually attained 49 per cent growth compared with 2015.

 

Experts confirm high and vigorous e-commerce growth for 2019. Giant e-marketplace platforms including Lazada, Shopee, and JD will continue to heavily invest in taking marketshare, while giant social media platform including Facebook (and Instagram), Google, and Line will next year focus on e-commerce services. 

 

Payment and logistics are the backbone of the sector’s growth. They will next year both see players taking a more aggressive stance to encourage e-commerce in this country. Thailand Post plans to launch a cash-on-delivery (COD) service to drive e-commerce next year, while Alibaba will operate a logistics hub in the Eastern Economic Corridor (EEC).

 

Thanawat Malabuppha, president of the Thai e-Commerce Association and chief executive officer of Priceza, predicts a more competitive market next year, with growth over 30 per cent above this year.

 

A dominant trend for the coming year will involve a shift from the current approach of social platforms to one that prominently includes e-commerce. All major platform players – including Google, Facebook, Instagram and Line – are about to aggressively enter the e-commerce battlefield. Google Shopping will be more active in Thailand, and Facebook Marketplace will be both more active and more aggressive. A lot more offline merchants will have an online presence on these platforms.

And many more people will be going online.

 

 “Even bankers will be more aggressive on e-commerce, but the biggest impact to the market is the aggressive move of giant platform providers including Google, Facebook, and Line next year,” said Thanawat. 

 

Even as search engines and social media platforms join the e-marketplace, the giant e-markets are crossing over into social media and searching. For example Lazada and Shopee started to host chat services to allow customers to chat with the merchant, with Lazada also allowing people to post to a news feed similar to that found on Facebook. In its most recent move, merchants can now to “live” on the Lazada app instead of on Facebook.

 

“Social media platforms like Facebook, Google, and Line have entered the e-commerce [ecosystem], while e-commerce platform like Shopee, Lazada, and JD have begun to offer several new social media services in order to be a part of users’ [lives]. These platforms both encourage and compete with each other,” said Thanawat.

 

Competition between Lazada, Shopee, and JD will be more intense next year. Within these e-marketplaces, merchants will also compete more. These e-marketplaces, offer at least 75 million items, with the varieties of products continuing to grow. Around 80 per cent of these products are made overseas, mostly in China. The presence of cross-border products will increase, and in the process destroy the competitive advantage of merchants who merely import products from China to sell online without adding any value. 

 

The next trend is e-payment, Thanawat said, with cash on delivery (COD) accounting for the largest portion of e-commerce payment. COD can encourage people to dare to try out online shopping, and so can help recruit new online shoppers. On the other hand, COD is costly and inconvenient, as people need to wait to receive the product and make their payment. 

 

“According to Bank of Thailand, the cot of handling a cash payment is around four to five times more expensive than for electronic payment. According to Amazon India, COD payment is three to five times more expensive than Amazon Pay,” said Thanawat.

 

All e-marketplace providers will try to drive people to their e-wallet to facilitate payment with electronic money. It is expected to see JD wallet next year. Lazada already has its wallet, Shopee has Alipay, and Line has Rabbit Line Pay. Next year, they will use subsidies to encourage people to shift to paying with e-wallet. The use of COD will decline, but for now remain the top choice for e-commerce payment in Thailand.

 

Omni-channel marketing will next year play a larger role in e-commerce. The omni-channel concept is to draw brands to every environment hosting large numbers of customers with the same seamless shopping experience As the platforms – Google, Line and Facebook – encourage e-commerce, many more brands will be drawn to the ecosystem, given the huge numbers of people hanging out there. 

 

“Another driving factor is social media. E-commerce in Thailand is still growing at 30 per cent according to Google-Temasek.

Social media is booming, Thais favour social media commerce. Thailand has the highest portion of social commerce than anywhere else in the world, according to PricewaterhouseCoopers,” said Thanawat. 

 

The top three products categories for which people prefer to shop online are fashion, electronics and beauty.

 

Sustained expansion tipped

 

Pawoot Pongvitaya-panu, tarad.com founder and chief executive   and the former president of the  Thai e-Commerce Association, said that e-commerce in Thailand will continue to enjoy healthy growth next year. That’s because the big e-marketplace players will continue to invest heavily in e-commerce to capture marketshare, he explains, while the social media platforms continue to launch e-commerce services. “Next year, both the e-marketplace and social commerce will continue as the two main platforms for e-commerce in Thailand,” said Pawoot.

 

“Next year we will see more interesting e-commerce advertisements, especially from shopping searches like Google Shopping, which we have not seen a lot of this year in Thailand,” said Pawoot. 

 

He added that Facebook will be more active in e-commerce, with both Facebook Marketplace and Facebook Group – as well as in logistics. Also, bankers will concentrate more on e-commerce as well, with more banks stepping into e-commerce. For example, Kasikornbank has launched KPlus Market.  “Line is another player that will make a big move into e-commerce next year .This year, Line acquired Sellsuki and is expected to do more,” said Pawoot.

 

Brands will focus more on e-commerce, getting involved in that market through both their own shopping websites and the e-marketplace. 

 

Additionally, e-commerce in  2019 will continue its growth, due to the investment of payment and logistics players to facilitate people living in countryside to more easily shop for products online. Next year, a larger portion of e-commerce buyers will be spread out across the nation, with a sales split of about 44:56 between rural buyers and those in Bangkok.

 

However, because of aggressive moves in the big e-marketplace by Lazada, Shopee and JD, a lot more products from China are expected to flow through the Thai e-commerce market. The draft of the new Revenue Code will see tax investigations of people having above 3,000 online money transfers per year. The regulation could have an impact on e-commerce but is not expected to affect its growth.

 

People’s top three favourite product categories for online purchases are mobile and electronic products, fashion and beauty.

 

Artificial intelligence (AI) will play more role in e-commerce next year, and there will see a lot more use-cases. 

 

“E-commerce will grow continuously and rapidly next year, building on the momentum from this year. All giant e-commerce players – Lazada, Shopee, and JD – heavily invested in e-commerce in Thailand this year and will next year,” said Pawoot. “One aggressive move is to leave commissions out. They also offer an open “mall” such as Lazada’s LazMall. Shopee opened ShopeeMall to compete withJD.com.” 

 

Though these three giants hold most e-commerce in their hands, the other big slice of e-commerce – social commerce – is not yet dominated by a major player. Social commerce has become the long e-commerce tail in Thailand.

 

 

[keith101]

Iam happy with Lazada if i have had problems they have always given me no questions asked full refund on returns .

[BritManToo]

I use Lazada mainly but check the Shopee prices as well for expensive items.

Bought an Oppo F9 from Shopee last month for 9,300bht when Lazada was selling it for 10,900bht.

 

You have to compare.

[Aachen]

On the other hand, COD is costly and inconvenient, as people need to wait to receive the product and make their payment. 

Should read:

On the other hand, COD is costly and inconvenient, but people can wait to receive the product and make their payment then. 

 

Nevertheless Promptpay is a good alternative - it is COD in an electronic way ????

Edited December 29, 2018 by Aachen