L-R: Chua Kee Lock, Roger Egan, Nguyen Hoa Binh, Alexis Horowitz-Burdick, Grace Clapham
The e-commerce scene in Asia is thriving and beaming with potential. However, while there are several real problems to be solved, from being able to purchase cosmetics online to same-day delivery of fresh food, these founders often meet roadblocks in the form of cash on delivery and traffic woes.
Horowitz-Burdick, who runs Luxola, a Singapore-based online beauty store, said, “From our standpoint, in Southeast Asia, we still have an issue of disposable income. … When we think about Luxola versus other subscription boxes, if they are going to spend money, they would rather choose what they want to get.”
Binh added that such novelty ideas are still nascent, and will only take off once traditional e-commerce gains popularity in Southeast Asia.
Trust the brand Having been around for the last three years, the value of building trust is not foreign to Luxola or Singapore-based online grocer RedMart. Egan said that in order to create a brand identity that customers will identify with, trust is very important. “When we started, people wouldn’t pay with credit cards, and we had to do cash on delivery. … Since then we’ve gotten rid of cash on delivery and gained a lot more trust.”
Customer experience also comes hand-in-hand with building trust or a brand identity. Luxola has a simple yet surefire strategy. “We’re looking at what our users are suggesting,” said Horowitz-Burdick. In the future, the firm might move towards including white label products in its offering.
“For online e-commerce, branding is a huge issue,” added Lock, adding, “Customers can disappear the next second.” Online stores often do not receive the same sort of leniency which its offline counterparts have enjoyed for years.
While there is a plethora of ways to keep users engaged, being price competitive is also a pertinent point to remember, said Egan. He added that convenience isn’t as valued in Asia, as compared to its peers in the West.
Fundraising for an e-commerce firm How does an e-commerce company like Luxola or RedMart raise funds to enter emerging markets? “… Maybe there’s a misunderstanding about how much it takes (to run an e-commerce startup). If you’re looking to do something with a small (amount) of investment, you’re better off with a niche market,” said Horowitz-Burdick.
Setting up a website to sell digital or physical goods is probably the easiest task on an e-commerce owner’s to-do list. In order to accomplish feats like same-day delivery, which both RedMart and Luxola offer, and provide value-added services like fresh food delivery, startups need a tonne of funding.
This is a live coverage of Echelon 2014, Asia’s largest tech conference. Follow the hashtag #echelon2014 to join the Twitter conversation. View the full coverage here.