Lazada kicks off online holiday shopping season with month-long sale

MANILA, Philippines – Southeast Asia’s biggest online shopping event will start at midnight on Friday, Nov. 11, kicking off a holiday shopping season that could best be remembered as the time when e-commerce has sort of come of age in the Philippines.

Just a few years ago, the date didn’t mean anything to Filipino shoppers and perhaps to many of the region’s over 600 million people, but the Internet has turned the world into a much smaller place where everything is interconnected.

Across China and much of the rest of Asia, Nov.11 is known as the “Single’s Day Shopping Festival” (known today as the 11.11 Global Shopping Festival). Introduced by the Chinese e-commerce giant Alibaba Group in 2009, it started as a modest 24-hour online shopping frenzy. Last year, more than 40,000 brands participated in what has become the world’s biggest online retail event with gross merchandise volume (GMV) reaching $14.3 billion.

Lazada Philippines assembled a team of merchants that will offer the best deals to millions of online Filipino shoppers this holiday season.

Southeast Asia also has its own version of 11.11, which started in 2012. Called the 12.12 shopping festival (because it was held on Dec. 12, 2012), the 24-hour online shopping marathon has since evolved to become a month-long shopping festival. And instead of Dec. 12, it now starts on Nov. 11, simultaneous with the 11.11 shopping festival in China, and ends on Dec. 12.

Inanc Balci, CEO and co-founder of Lazada Philippines, says that the month-long sale it calls the “Online Revolution” campaign has become the biggest online retail event in Southeast Asia, which also corresponds with the growth of e-commerce in the region. Lazada Philippines alone now has over 4.3 million products on sale in its marketplace and over 8,000 merchants selling on the platform. It corners a high  85 percent share of the country’s e-commerce market.

“The reason we launched the Online Revolution campaign is not to increase the revenues of Lazada. We have a more holistic, more long-term vision. We want to increase the e-commerce penetration in the Philippines. We want more people to shop online in the country and in Southeast Asia,” he says.

The effort seems to be paying off. From only 300 items sold in the one-day event in 2012, sales have grown to over 100,000 items sold per day during the  month-long sale last year.

 Biggest Deals

Up for grabs in this year’s event are over a million discounted products from 12,500 local and international brands. “These are actual discounts versus the prices available on Lazada today,” Balci says. 

Deal seekers will be delighted, for example, with the so-called P11 deals, which means that some customers may be able to buy items like a Virtual Reality Box, a LED light bulb rotating lamp or a Genius gaming mouse for only P11. There are also limited-time flash deals on a 32” Slim LED TV for P5,499, a Fujidenzo 20L microwave oven for P1,999, a Star Mobile 4.5” smartphone for P999, an HP desk jet printer for P888, and a L’Oreal lip and cheek palette for P399.

The deals extend to over 17 product categories, but Balci says Lazada will also focus on customer interests with weekly specials or a curation of items every week such as beauty products (Nov. 14-19), family (Nov. 20-24), cyber sale (Nov. 25-28), techies week (Nov. 30-Dec, 2) and trendsetters (Dec. 3-6).

The deals come with a guarantee from Balci himself that the items will be delivered before the Christmas period.

Inflection Point

During the sales period, Balci says they expect over 4.5 million visits to the site. “To give you an idea how big this number is, it’s half of the population of Metro Manila. It’s six times more than the daily foot traffic in the biggest mall in the Philippines, and two times the number of Filipinos working abroad,” he says.

In an interview with The STAR, Balci, however, says that it is not competing with brick-and-mortar stores. “We are more an additional channel to offline retail. We do not want to challenge the offline retailers but we want to open up a completely new channel where they can reach everyone in the Philippines because if you are an offline store, it is very difficult to open a store on every island in the Philippines. But if you come to Lazada, anyone living wherever in the Philippines can buy your items, so it becomes an additional arm to your business,” he explains.

For all its efforts in spreading the e-commerce gospel, Lazada is actually right at the center of a major commerce revolution brewing in the Philippines and the region.

A Google-Temasek study released last May estimates the Southeast Asia e-commerce online market to be a $200-billion opportunity. In the Philippines, the market is set to grow over 34 percent over the next 10 years, to reach $19 billion by 2025, with the majority of growth coming from e-commerce, according to Google Philippines country manager Ken Lingan in a recent media briefing.

The same report shows that the number of people who buy goods and services online is predicted to grow 18 percent annually or five times in 10 years from eight million to 42 million in 2025. Moreover, another study released recently by Google and IPSOS shows that over six out of 10 Filipinos (61 percent) now own smartphones – an important tool in mobile commerce.

Balci says Lazada is preparing for this explosion of commerce through different channels. “We are making the marketplace bigger and bigger. At the same time, we are getting more products on Lazada and we want to always lead in terms of having the largest assortment and the most affordable prices. On top of that, I always talk about logistics being the No. 1 challenge in the Philippines. We have our own Lazada Express, which we are also expanding,” he says.

Coming Full Circle

In April this year, China’s Alibaba Group bought a controlling stake in the Lazada Group for approximately $1 billion. Michael Evans, president of Alibaba, was quoted as saying during the announcement of the acquisition that with the investment in Lazada, Alibaba gains access to a platform with a large and growing consumer base outside of China.

Maximillian Bittner, CEO of Lazada Group, also talked about bringing about synergies that will drive great benefits to customers in Southeast Asia.

“Alibaba has been running their business for more than 15 years and they have a vast knowledge of e-commerce,” adds Balci. “Every day, we are learning more and more from them and implementing it in our business in Southeast Asia. So this will continue.”