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Make e-commerce local in SE Asia

News, 03 October 2016

SINGAPORE: Increased internet penetration, high social media engagement and a mobile first consumer culture are building the foundations of e-commerce growth in South East Asia, but brands need to avoid a one-size-fits-all strategy if they are to succeed.

That's the view of Riccardo Basile, Chief Commercial Officer at Lazada who told Warc that brands stepping into the region's highly fragmented online markets needed to appreciate the different languages, religions and shopping cultures that affect marketing strategy.

"Countries like Thailand have their own very specific culture," he said. "Some countries are more geared towards China, like Singapore and Malaysia.

"Indonesia has 250m people so it's very different. The Philippines are looking more towards the West – more of a strong American influence," Basile said. (For more, including the opportunities and challenges facing online retailers in the region, read Warc's exclusive interview: Five insights from Lazada on e-commerce in South East Asia.)

In emerging markets, unique challenges present themselves – such as a cash culture, underdeveloped infrastructure and suspicion about online payment security.

"Trust, especially in the beginning of our journey, was one of the elements we had to unlock. That's why we launched cash on delivery … it is a great way to unlock that first purchase," Basile said.

"We encourage people to try the service, to trust us, and normally then people stay with us."

Other ways of addressing the trust issue include secure payments via mobile wallets or in-store payments.

And, again highlighting the preferences of certain countries, "You can also pay at the ATM, like typical bank transfers, which is very popular in countries like Indonesia."

The company, which has suffered well-publicised cashflow issues in recent years, recently received more than $1bn in investment from Chinese e-commerce giant Alibaba as it eyes expansion into South East Asia.

Data sourced from Warc