Thanks to the stunning rates of tech adoption, the increase of open trade across Asian borders and the rise of discretionary income, e-commerce has become the newest young-hot-thing.

The potential for growth is high as ever. Asia-Pacific (APAC), for instance, is currently home to over 60 per cent of the global population – and the world’s fastest-growing economies.

Given that the online economy of Southeast Asia (SEA) alone is expected to hit US$240 billion by 2025, global players are keen to participate in the space despite the challenges they have to face.

To start, they have to compete with homegrown ventures that already have a pool of loyal local customer bases. This is perhaps best exemplified by Amazon’s recent retreat from China due to its struggle to compete with the likes of Alibaba and JD.

Still, the relative newness of the space means that there are opportunities for established companies with global experience to offer value to the region’s various e-commerce stakeholders. Texas-based e-commerce platform BigCommerce, for example, announced on February that the company had opened an office in Singapore in an effort to expand its reach in the region.

BigCommerce Director of Asia, Dene Schonknecht, recently agreed to share his thoughts on the challenges and strategies involved with expanding an e-commerce presence through a partner ecosystem in the APAC region, in this article.

The APAC e-commerce opportunity

Despite rapid developments in Asian e-commerce infrastructure and fintech, barriers to launching an e-commerce business still exist.

Many Southeast Asian merchants simply choose to set up shop on marketplaces like Lazada, Tokopedia and Shopee, opting to trade sales percentages and pay fees for an easier way to establish their online presences.

Smaller sellers even continue to rely on free online classifieds and Facebook Marketplace due to the capital and technical expertise needed to create an e-commerce app or site. These businesses miss out on the benefits that having their own e-commerce channel brings, such as better branding, customized experiences, and omnichannel opportunities.

“We’re still seeing a gap in the platform market, so we believe in the opportunity available to us in APAC – and believe that we can add value to merchants in the region,” Shonknecht explained. “We spend a lot of time telling our story, educating merchants and partners on how we are unique relative to the established competition.”

Also Read: E-scooter startup Beam sets up operations in Malaysia

By entering the arena, BigCommerce is banking on continued growth in regional demand for e-commerce tech solutions, which in turn, is contingent on continued e-commerce shopping growth in the region.

While it already has existing customers in Asia including brands like Isetan, Resmed and Suntec, the company believes that the wider community of Asian entrepreneurs is still under-served.

The challenges of being a challenger

Schonknecht says that he sees two key challenges to his company’s Asian penetration efforts. First is market prioritisation. They need to ensure that their team is focused on markets where there is the best combination of merchant demand, product fit and partner competency.

Second is branding and education. As a new entrant in the space, the company needs to be able to communicate its distinct identity as well as its global credibility.

To overcome these challenges, it’s critical for them to establish a partner ecosystem consisting of agencies and developers, to encourage merchants to adopt the solution.

“As anyone who has done business in APAC will know, there is no monolithic market known as ‘Asia,’” Schonknecht asserted. “In order to be able to serve this region effectively, we need local agencies and developers that operate close to merchants and understand the intricacies of the local or regional e-commerce markets they operate in.

They will ultimately be the ones working with merchants to bring all parts of the ecosystem together – including localized solutions for payments, shipping, tax and marketplaces,” he said.

The region’s diversity is both a boon and bane for e-commerce players. While the variety of niches and locales can provide them with fresh opportunities, this also means that platforms need to support integrations with hundreds of locally favoured services.

How to win as an outsider

Other platforms like Magento and Shopify have already made some headway in the region, establishing regional offices in 2017 and 2018, respectively. A Magento veteran himself, Schonknecht is aware of the strategies needed to make a splash in the Asian market.

Each of these American e-commerce giants have attacked Asia with their own distinct strategy.

“Shopify’s approach seems to be more focused on serving smaller startup businesses with a closed ecosystem of Shopify services like payments and point-of-sale,” Schonknecht said.

“Magento, on the other hand, is trying to push more into the enterprise segment of the market following the Adobe acquisition and subsequent price increases for its Commerce Cloud. So while our strategies may be similar in terms of market entry in Asia, we believe the BigCommerce value proposition of ‘open SaaS’ will serve a significant segment of Asian markets.”

Indeed, the platform’s customisability and available integrations will also be key. The specific needs of e-commerce stakeholders in a market like Asia may not be supported out-of-the-box by platforms that were initially designed for use in the West.

For example, due to the large population of unbanked customers, cash-on-delivery (COD) remains to be a preferred payment method in the region. For a platform to be of value to merchants, it must be able to work smoothly with the various logistics providers that can handle COD.

“It’s early, and the market feedback has been validating our approach. That said, we are making tweaks – for example, around which agency or technology partners we work with – in order to have the most impact in the markets we prioritise,” Schonknecht shared.

“For example, we often provide product roadmap feedback and development requests to our teams in Austin or Sydney to accommodate a local requirement like a specific payment gateway, logistics solution or the like.”

New players are (somewhat) welcome

Considering that its formal foray in the APAC scene is just a few months old, BigCommerce’s efforts in building a partner network is already showing promise.

“On the agency partner side, during Q1, we have signed up 50 per cent of the target agencies we intend to work within 2019, so interest in partnering with BigCommerce is strong,” said Schonknecht.

Also Read: Are you the solution to Asia’s content crisis?

“The partners are already driving the incremental net new pipeline of business that we simply would not have been in consideration for until we had established our presence here.”

It will be interesting to see how well the platform fares in the year ahead. E-commerce stakeholders in the region definitely stand to benefit from the presence of another platform, especially one that offers support, active development and a growing ecosystem.

But nothing is a sure bet anymore, particularly given how saturated and tricky the Asian e-commerce space is. And with increasing signs of global and regional economic uncertainty, Schonknecht and team have their work cut out for them.

e27 publishes relevant guest contributions from the community. Share your honest opinions and expert knowledge by submitting your content here.