Lazada launched in 2012 and ever since became Southeast Asia’s number one online shopping and selling destination, operating in 6 countries across SEA. Pioneering eCommerce in the region, Lazada offers customers an effortless shopping experience across mobile and web platforms, multiple payment methods and extensive customer care. In the meantime, retailers have simple and direct access to over 550 million consumers in six countries through one retail channel. Lazada features an extensive product offering in categories ranging from consumer electronics to household goods and fashion.
Lazada saw an opportunity in SE Asia’s massive, underpenetrated market:
- Compelling macro secular trends – including GDP growth projections above 8.0% and more than 550m potential customers.
- Nascent market opportunity – characterized by low and rapidly growing smartphone penetration and tinny share of eCommerce as % of retail.
- Outsized growth in SE Asia eCommerce market.
- Increasing income levels that drive further growth.
Despite the massive potential, SE Asia’s structural challenges represented significant barriers to entry:
- Payments – low credit card penetration, preference for local payment solutions and cash on delivery method.
- Logistics – underdeveloped infrastructure, scattered logistics networks, geographic diversity.
- Supply Chain – fragmented local merchant network, inexperienced local merchants, inefficient supply chain.
- Regulatory – challenging import / customs environment across markets.
- Culture & Talent – user behavior vary across and within 6 markets, limited and inexperienced local talent pool, language differences.
Lazada addressed these challenges to become the only eCommerce platform operating across 6 distinct markets in South East Asia and as such created a hard-to-replicate platform.
- Gateway to SEA via a single touchpoint:
- The only eCommerce platform with pan-SEA reach
- Leading brand name: #1 across all launch markets
- Local operations, fulfillment and distribution
- Optimized marketing platform
- Immediate access to 550m potential customers
- Comprehensive marketing strategy across social, mobile and TV
- Best-in-class logistics & supply chain network
- Own warehouses, last mile hubs and largest network of partnerships with local and regional 3PLs
- Customs expertise that enables Lazada to serve all countries seamlessly
- Broad spectrum of supply chain solutions: inventory, cross-docking, drop-shipping, consignment, FBL (Fulfilment by Lazada)
- Secure & trusted payments platform
- Pioneer of COD (Cash on Delivery) with close to 100% coverage in all countries
- Localized payments methods catering to each market
Lazada is building an ecosystem that generates network effects as the platform continues to scale. Broader product assortment brings more customers, attracting more merchants and in turn creates a virtuous cycle driving free traffic, improved curation and higher price leverage.
Seeing the potential of Lazada’s platform, Alibaba recently acquired a controlling stake in the company and is expanding to South East Asia through integration with Lazada.