1. What CEOs Need to Know About E-Commerce
Ray
Alimurung
|
DCOM
Summit
|
Aug
2014
Singapore
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Thailand
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Indonesia
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Philippines

2. Singapore
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Agenda
Defini5on
&
Business
Models
Market
&
A=tudes
Building
an
E-­‐commerce
Business
Trends
2

3. Definition & Business Models

4. Singapore
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Definition
4
E-­‐commerce.
Type
of
business
model
wherein
a
firm
or
individual
trades
products
or
services
over
the
Internet
[Addendum
for
emerging
markets]
…
regardless
of
whether
the
commercial
transac5on
is
completed
online
or
offline

5. Singapore
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5
Rationale
To
harness
the
power
of
the
Internet
to
drive
reach
and
the
number
of
simultaneous
transac5ons
426
Amazon
transacBons
per
second
on
Cyber
Monday
2013
37m
Amazon
items
sold
on
Cyber
Monday
2013
$5.8b
Alibaba
sales
volume
on
Singles’
Day
2013

6. Singapore
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Business Models: Product Offerings
Digital
Goods
Digital
Services
Physical
Services
Physical
Goods
B2C
B2B
C2C
6

7. Singapore
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Thailand
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Indonesia
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Philippines
Business Models: Revenue Streams
AdverBsing
Commission
SubscripBon
Retail
(Goods
&
Services)
B2C
B2B
C2C
7

8. Singapore
|
Thailand
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Indonesia
|
Philippines
Marketplace
/
Classifieds
Marketplace
+
Merchant
Services
Single
brand
/
MulB-­‐brand
Retail
MulB-­‐brand
Private
/
Flash
Sales
Merchant
Services
C2C
B2C
B2B
Business Models: Traditional E-Commerce
8

9. Market & Attitudes

10. Singapore
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Thailand
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Indonesia
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Philippines
Attitudes Towards E-commerce
10
Why
don’t
you
shop
online
(more
oYen)?
Security
Payment
op5ons
Payment
convenience
Want
to
handle/view
product
Speed
Source:
Surveys
within
several
top
PH
corpora=ons;
TNS
Online
Shopper
Study:
Philippines,
Feb
2013
Why
didn’t
you
do
your
last
non-­‐necessity
purchase
online?
Selec5on/Availability
Payment
convenience
Pricing
Want
to
handle/view
product
Security
40%
of
online
Filipinos
who
have
never
shopped
online
expect
to
buy
online
in
the
next
12
months

11. Singapore
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Philippines
11
S.E.Asia E-commerce Market (2013E)
Unit ID SG PH VN TH MY China US
PopulaBon
M
248
5.2
95
88
67.5
28.9
1,350
315
#
Online
M
75
3.9
33
31
32
18
513
246
%
Online
%
30%
74%
34%
35%
46%
63%
38%
79%
#
Social
Media
Users
#
66
3.6
38
24
27
17
NA
168
#
E-­‐commerce
Shoppers
#
5.6
1.8
5.8
13.2
14.5
10.5
164
184
E-­‐commerce
Shoppers
%
2.3%
34%
6%
15%
21%
36%
12%
58%
Retail
Sales
USD
B
134
31
34
108
139
51
2,380
4,700
B2C
E-­‐commerce
Market
USD
B
0.9
1.1
0.4
0.5
1.1
0.7
190
343
E-­‐commerce
%
of
Retail
%
0.7%
3.5%
1.1%
0.5%
0.6%
1.4%
8%
9%
Annual
Customer
Spend
USD
252
917
172
42
365
68
726
1,864
Source:
UBS
Research,
Nielsen,
Comscore,
PWC
HK,
ATKearny,
researchandmarkets.com,
Dailysocial,
smu.edu.sg,
E-­‐commerce.org.sg

12. Singapore
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Thailand
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Indonesia
|
Philippines
US retail growth is driven mostly by e-commerce
Source:
US
Census,
Internet
Retailer,
BI
Intelligence
es=mates
12

13. Singapore
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Thailand
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Indonesia
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Philippines
Amazon
15%
Rest
of
North
America
85%
Amazon
Market
Share
of
North
America
E-­‐commerce
(2013)
13
Amazon is only 15% of North America e-commerce
Source:
BI
Intelligence
es=mates

14. Building an E-commerce Business

15. Singapore | Thailand | Indonesia | Philippines
15
E-commerce Activities
Customer
Service
CopywriBng
&
Content
Web
&
Mobile
Design
IT
Development
ProducBon
&
Photography
Sourcing
&
Merchandising
Payment
Processing
Business
Intelligence
MarkeBng

16. Singapore | Thailand | Indonesia | Philippines
16
Customer
Ordering
Storage
Packing
Order
Processing
Picking
Cash
on
Delivery
Delivering
Dispatching
Inbounding
E-commerce Activities (2)

17. Singapore
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17
E-commerce Challenges for Brands & Retailers
Lack
of
in-­‐house
talent
–
Current
organiza5on
may
not
understand
e-­‐
commerce
complexity
and
may
lack
a
leader
for
its
strategy
and
execu5on
Fulfillment
is
not
set
up
for
single
orders
(B2C)
–
Set
up
to
fulfill
B2B
bulk
orders
on
pallets,
not
individual
customer
orders;
need
separate
processes
and
systems
to
manage
B2C
handling,
storage,
delivery,
returns.
Customer
service
must
respond
to
high
demands
–
Need
phone
and
email
team
that
can
handle
high
volume
and
personalized
service
such
as
product
ques5ons,
website
how-­‐to’s,
order
status,
and
aYer
sales
Channel
conflict
–
Mul5
channel
is
not
omni
channel.
Need
a
unified
view
on
assortment,
pricing,
returns
E-­‐commerce
plaiorm
implementaBon
–
Current
technology
does
not
support
online;
need
new
implementa5ons
for
order
management,
warehouse
systems,
customer
service,
CRM,
etc.

18. Singapore
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Thailand
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Indonesia
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Philippines
Functional Organization
CEO
Buying
&
Sourcing
Store
Opera5ons
Warehouse
Opera5ons
Marke5ng
Offline
Marke5ng
Digital
Online
Marke5ng
E-­‐Commerce
Head
Online
Customer
Service
IT
Finance
Customer
Service
18

19. Singapore
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Thailand
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Indonesia
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Philippines
Functional Organization (2)
E-­‐Commerce
Head
Buying
&
Sourcing
Marke5ng
IT
Opera5ons
Business
Intelligence
Finance
Product
Management
19

20. Singapore
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Thailand
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Indonesia
|
Philippines
Functional Organization (3)
E-­‐Commerce
Head
Buying
&
Sourcing
Buying
/
Merchandising
Buying
Opera5ons
Inventory
Planning
Inventory
Management
Pricing
Marke5ng
Online
Marke5ng
SEM
/
Display
Ads
SEO
Social
Media
Email
Affiliates
Crea5ves
Design
Copywri5ng
Branding
Offline
Marke5ng
Category
Management
IT
Development
Network
Systems
Database
Helpdesk
20

21. Singapore
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Thailand
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Indonesia
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Philippines
Functional Organization (4)
E-­‐Commerce
Head
Opera5ons
Warehouse
Opera5ons
Order
Processing
Inbound
Inventory
Outbound
Logis5cs
Returns
Content
&
Produc5on
Content
Management
Copywri5ng
Photography
&
Edi5ng
Customer
Service
Inbound
Phone
Outbound
Phone
Email
QA
/
Training
Business
Intelligence
Repor5ng
Marke5ng
Analy5cs
CRM
Analy5cs
Finance
Payments
/
Fraud
Refunds
Product
Management
21

22. Singapore
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22
Benefits of Outsourcing E-commerce
Go-­‐to-­‐market
faster
Limit
need
to
recruit
and
build
in-­‐house
team
Access
industry
best
prac5ces
Research,
test,
and
learn
before
over-­‐inves5ng
Lower
costs
due
to
economies
of
scale

23. Singapore
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Thailand
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Indonesia
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Philippines
23
Selecting Outsourcing Partners
One-­‐stop
Shop
Web
Design,
Devt,
Maintenance
Delivery
Order
&
Inventory
IT
Systems
Copywri5ng
&
Produc5on
Online
Marke5ng
Payment
Gateway
Warehouse
Storage
&
Fulfillment
Customer
Service

24. Trends

25. Singapore
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25
Trends
• Mobile
is
25%
of
global
e-­‐commerce
traffic…
and
growing
• Marketplaces
dominate
Asian
e-­‐commerce
§ Alibaba
drives
$157b
in
GMV
à
43%
of
B2B;
50%
of
B2C;
95%
of
C2C
• Cash
on
Delivery
(COD)
accounts
for
at
least
50%
of
PH
tradi5onal
e-­‐commerce,
while
escrow
is
preferred
in
China
§ Alipay
is
used
for
e-­‐commerce,
remilance,
bills
payment,
bus
5ckets
Source:
“The
Future
of
Retail:
2014”,
BI
Intelligence

26. Key Takeaways

27. Singapore
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27
Key Takeaways
• The
opportunity
is
huge
and
the
market
is
ready
• E-­‐commerce
is
complicated;
be
open
to
outsourcing
• Structure
your
opera5ons
and
organiza5on
accordingly
• Now
is
the
5me
to
research,
test,
and
learn

28. There
is
so
much
stuff
yet
to
be
invented.
There’s
so
much
new
that’s
going
to
happen.
People
don’t
have
any
idea
how
impacnul
the
Internet
is
going
to
be
and
that
this
is
s5ll
Day
1
in
such
a
big
way.
Jeff
Bezos,
Founder
&
CEO,
Amazon.com

29. Thank You
ray.alimurung@acommerce.asia
Singapore
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Thailand
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Indonesia
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Philippines