Friday 29 Mar 2024
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This article first appeared in Digital Edge, The Edge Malaysia Weekly on December 27, 2021 - January 2, 2022

Rajesh D had never liked the idea of shopping online when he could do it in person. “It is a sensory experience. I like to see and feel what I’m buying,” was his common refrain. But this was in December 2019, when his partner suggested doing their Christmas shopping online, as the malls would be teeming with people.

It wasn’t until March the following year that he relented. A novel coronavirus that was airborne and deadly was spreading faster than anyone could fathom. On March 11, the World Health Organization declared the outbreak a global pandemic, and seven days later Malaysia, with 790 positive cases, imposed its first Movement Control Order (MCO).

Rajesh, like many others, was not quick enough to stock up on essentials. He downloaded a grocery delivery app that would become the gateway to his online shopping binge.

“By April, I was buying dumbbells so that I could work out at home. I got turmeric supplements because there were all kinds of prompts on Facebook that it helped boost immunity.

“I also bought a doorstopper, a soap dispenser and air purifying plants because I felt my house needed some refurbishing since I was spending all my time in it. And a dartboard and an air fryer to keep myself occupied.

In mid-March, when the spread of the coronavirus was declared a pandemic, the e-commerce sales of cooking appliances, the air fryer in particular, shot up as more people began cooking at home. The sales and adoptions of live puppies and dogs, as well as interactive and board games, surged as popular distractions for people looking for a ‘digital detox’.

“I also nearly purchased a toy poodle puppy from a seller on social media but had the sense to check if it was legitimate first. Turns out there are many such scams. A few got conned out of RM4,000 to RM5,000 by such sellers and received boxes of tissues instead,” he relates, nonchalantly.

Admittedly, little encouragement is needed to get shopping online these days.

Once one gets the hang of it, navigating through the assortment of products, from essentials to knick-knacks — and the convenience of not having to do much except to tap a screen a few times to complete the purchase — becomes a breeze.

Rajesh and millions like him in Southeast Asia are why the digital economy is on its way to becoming a US$1 trillion industry in this region by 2030.

The region has more than 440 million internet users, 350 million of which are digital consumers who have bought from at least one online service in the past year, according to Google, Temasek and Bain & Co in the sixth edition of their e-Conomy Southeast Asia (SEA) report titled “Roaring 20s: The SEA Digital Decade”.

And Malaysia leads in the region with 88% of its 33.45 million population being digital consumers. Facebook and Bain & Co’s annual SYNC Southeast Asia report estimates that the country’s e-commerce sales will continue to grow by 230% in the next few years.

“Before the Covid-19 pandemic, Malaysians primarily purchased personal, fashion and household items online,” says Terence Pang, chief operating officer at Shopee. “Today, we see them shopping for almost everything online, from daily essentials and household supplies to properties, insurance plans, hotel stays and more.

“This includes the willingness to purchase fresh and frozen goods such as poultry, vegetables and fruits online. The increasing demand for fresh produce has encouraged more local traders to come online, resulting in over 170,000 new product listings on the ‘Fresh and Frozen’ food category on Shopee.”

In 2020, daily essentials accounted for the bulk of the orders on Shopee. This year, Malaysians have also been purchasing items to adapt to working and studying remotely as well as sprucing up the home, says Shopee.

“Consumer tech goods such as laptops, smartphones, tablets, network components, keyboards, printers and audio systems were actively sought after as Malaysians adapted to work and study from home arrangements.

“Meanwhile, home decor products proved to be a hit with items like wallpaper, curtains, wall hooks, flower pots, vinyl flooring and hangers being snapped up as consumers went into home improvement projects, as they were spending more time at home,” says Shopee.

During the 9.9 shopping festival, Malaysians were even found picking up new hobbies or learning new skills such as crocheting and knitting. “As a result, over 4,000 bundles of yarn were purchased during 9.9 Super Shopping Day,” states Shopee.

A Lazada spokesperson says that since the start of the MCO in 2020, and up to the most recent one that ended on June 28, grocery purchases more than tripled year on year on Lazada, one of the earliest e-commerce marketplaces in the region.

“During the recent 9.9 Biggest Brand Sale, some of the most-searched keywords by local shoppers were for athleisure, smartphone and household-essential brands.

“The top growing categories on LazMall such as beauty, grocery and baby supplies recorded over 15 times more purchases compared with the previous month,” the spokesperson adds.

LazMall is an authenticity-guaranteed branded section with a curated selection of leading international and local brands, top-rated online brands and authorised brand distributors — akin to a department store with all your favourite online brands all in one place.

“LazMall brands also saw a triple increase in their online store followers across the sales period. Increasingly, consumers are showing growing confidence and trust in purchasing bigger-ticket items, having the assurance of 100% authentic and quality products from the platform. In addition, LazMall offers a 15-day easy return policy, as well as reliable delivery service guaranteed to arrive on time.

“With more than 8,000 local and international brands, the momentum of LazMall continues to rise with shoppers looking for more variety and assortment of products,” says Lazada.

“We have also introduced a personalised portal — LazMall Prestige portal — which features premium brands and their unique brand stories to consumers that match their offline experiences too,” says the spokesperson.

The ‘shoppertainment’ phenomenon

The explosion in sales aside, the past year has also transformed the online retail experience tremendously.

Live commerce, which had grown dominant in China after Alibaba’s Taobao Live launched in 2016, has taken the world by storm and brought about what is known today as “shoppertainment”.

Apart from live-streamed broadcasts with stores to allow viewers to watch and shop at the same time, e-commerce marketplaces have also integrated feeds — mimicking the Facebook and Instagram setup — for key opinion leaders to engage with their audience.

Today, buyers want more from online buying than just a transactional experience, says Lazada’s spokesperson.

“As a result, live streaming has become an integral part of Lazada’s shoppertainment strategy, which marries shopping and entertainment by enabling consumers to watch, play and be entertained from the comfort of their own homes.

“As the pioneer of this feature in the region, Lazada’s in-app live streaming features LazLive, which allows shoppers, brands and sellers to interact in real-time as well as provides detailed product demonstrations and the chance to purchase items simultaneously.”

The spokesperson says Lazada is the only e-commerce platform in Southeast Asia offering the ‘See-Now-Buy-Now’ feature, via LazLive, “which creates a closed loop for in-app purchases, resulting in higher transactions and a smoother experience for consumers”.

During the marketplace’s Single’s Day sale on Nov 11 last year, the Lazada Super and Chief Discount Officer live shows garnered over 10 million views across all platforms and sold over 13,000 goods.

“LazLive has established itself as a critical tool for our brands and sellers to communicate with consumers in the context of our collective new normal,” says the spokesperson.

The most recent livestream on Single’s Day this year featured “Lazada Happiness Ambassadors”, including South Korean boy band SEVENTEEN and popular local celebrities Nora Danish, Dayang Nurfaizah, Sarah Suhairi and Sissy Imann as well as Lazada’s very own chief discount officer, Ain Edruce.

“As more Malaysians embrace the shoppertainment lifestyle, livestreamers have emerged as a feasible way for creatives to earn money from home via affiliate sales. To date, Lazada has trained nearly 200 livestreamers as part of the LazTalent initiative, enabling the young to augment their income through commissions on products sold through LazLive,” adds the spokesperson.

Shopee too had embedded shoppertainment features on its platform.

“Our in-app features such as Shopee Chat, Shopee Prizes and Shopee Live allow not only users to entertain themselves and connect on our platform but also brands and sellers to engage their shoppers directly,” says Pang.

Leveraging these features has helped drive engagement, build loyalty and sales conversions, he adds.

Shopee Live was launched to bring users closer to their favourite sellers and brands.

“This enables brands/sellers to engage their users throughout the shopping journey via a wide variety of live content like product reviews, guides and demonstrations. Shopee Live has since been widely received and recorded great results from streams, including those hosted by well-known local influencers,” the brand adds.

“We collaborated with organisations such as the Malaysian AIDS Foundation to raise awareness and educate the public on overcoming the taboo of HIV through dedicated Shopee Live sessions. We also partnered with the Sarawak Tourism Board in conjunction with the 7.7 mid-year sale to bring the Rainforest World Music Festival and Borneo Jazz Festival live to Malaysians in the comfort of their homes for the first time.

“We have also introduced a wide variety of successful in-app games and features that are now a core part of the Shopee experience and keep users coming back. The first game we launched was Spin & Win,” says Shopee.

Raise MSMEs profiles

Shoppers’ affinity for e-commerce and the rise of shoppertainment have boosted sales for micro, small and medium enterprises (MSMEs) tremendously.

Lipsticks from BeauTyra — a local beauty brand founded by Tyra Kamaruzzaman — sold out in minutes on Shopee Live during the product launch, with over 2,000 orders. Meanwhile, small-time retailer maliza89, who sells children’s pyjamas on the platform, saw orders go up by 40% after conducting livestreams, says Shopee.

On its part, Lazada has simplified the MSME onboarding by implementing “Start It Up, Laz It Up” — a three-step seller registration process that takes less than a minute to complete and at zero cost for anyone interested to sell online.

“Additionally, our Pintar Niaga stimulus package aimed at further flattening the barriers to digitalisation provides MSMEs with 0% commission and listing fees, as well as full access to Lazada University’s comprehensive step-by-step training, Seller Centre’s innovative tools, free marketing solutions funding, free high-traffic exposure slots, free shipping voucher incentives, and 90-day dedicated support, among others.

“The initiative aims to address business pain points and provide efficient solutions with subsidies and bonus exposure to help local SMEs boost their sales online,” says the Lazada spokesperson.

These programmes have led to an over 300% increase in sales for MSMEs, which are new to the platform. Moreover, the overall daily average transactions on Lazada have increased by more than 250% year on year, the spokesperson adds.

“As the e-commerce market expands, Lazada will continue to make e-commerce accessible to all by leveraging its capabilities in technology, logistics and shoppertainment, as well as enabling local MSMEs and entrepreneurs to reach their full potential online,” the brand says.

Meanwhile, Shopee’s Pang says that since March last year, over 200,000 local MSMEs have benefitted from the marketplace.

“They have collectively generated more than RM1 billion in sales through Shopee’s partnerships with various ministries, governmental agencies, associations and state governments under our #ShopeeSapotLokal umbrella,” he points out.

With the growing number of online-first customers and with more brands to choose from, sellers have stepped up their digitalisation efforts, observes Pang. “We believe this will continue as businesses find ways to integrate and optimise their revenue channels for the best reach of customers.”

Despite having nearly become a scam victim, Rajesh is undeterred when it comes to online shopping. “I keep asking myself, why didn’t I do it sooner?

“Not that I will stop shopping for stuff physically. Only that now, I can shop for staples and essentials without having to queue up,” he says.

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