Thailand
Thailand: E-marketplaces brace for competition
Intense competition from global commerce players has forced local e-marketplace operators to adapt for survival.
Two local e-marketplaces that have been operating for over a decade are shifting their strategies. Weloveshopping.com is moving its focus from online to offline, and synchronising online channels with True Corporation, while Tarad.com is in discussions with a new strategic partner to take the place of Rakuten, the giant Japanese internet player that sold its Thai share.
“In addition to the existing 11Street and Shopee, e-commerce competition in Thailand will become bloody in 2018 with the arrival of two Chinese internet giants — Alibaba and JD.com — that will saturate the e-commerce market, both for business-to-consumer and consumer-to-consumer,” said Darunporn Jirakitanusor, deputy director of Ascend Commerce, which oversees e-commerce for wemall.com and weloveshopping.com.
Ascend Commerce is an e-commerce arm under Ascend Group, owned by Charoen Pokphand Group (CP).
Subsidised prices and aggressive marketing from giant players have hit local e-marketplaces hard, leading them to revise their positions. Their transactions kept dropping last year, in part because of inactive marketing.
True Corp and CP decided to use weloveshopping.com and other online channels to leverage customers based on cross-over privileges.
“The company doesn’t want to spend huge sums of money like its rivals to survive in the market,” said Ms Darunporn.
Weloveshopping.com is in the process of upgrading its platform by integrating some True Corp services to fulfil the company’s online-to-offline strategy.
The new online services will be similar to those found in True Shops, offering discount coupons for local restaurants and other partners under True You, which is customer privilege of True.
In related news, weloveshopping.com has launched a One Tambon One Product (Otop) platform by collaborating with the Community Development Department under the Interior Ministry.
The firm aims to have 2,000-3,000 Otop items on the platform by 2018.
Weloveshopping.com will also promote Otop products to True customers.
“Otop items will attract more interest, especially herbal spa and cosmetics, snacks and Thai fashion items like silk and jewellery,” said Ms Darunporn. The majority of customers are female, from first-time workers to women in their mid-40s, she said.
Weloveshopping.com will provide content and marketing training to Otop merchants and gain a 3% commission fee.
Weloveshopping.com has 50,000 merchants and records average spending of 700 baht per user. Beauty and spa products are the highest-selling items on the website.
Wemall.com will also continue to position itself as a branded marketplace for consumer electronics, gadgets and IT products with 500 merchants.
The website wants to gain revenue from varying commission fees, depending on product category.
Pawoot Pongvitayapanu, managing director and founder of Tarad.com, said this year will see intense competition among e-commerce players in Thailand.
Local merchants need to find their niche in order to compete with Chinese products, he said.
Tarad.com is in discussions with strategic partners and will announce a new direction soon, said Mr Pawoot.
“Horizontal local e-marketplace players need to find their niches and focus on the customer experience in order to survive,” he said.
This year, the popularity of e-commerce will fuel severe competition in logistics and delivery services, said Mr Pawoot.
Source: https://www.bangkokpost.com/business/news/1392050/e-marketplaces-brace-for-competition