E-commerce ready for innovation
By Anushia Kandasivam May 30, 2017
- Retailers should use omni-channel e-commerce for success
- SMEs must be open to adopting new technologies, connecting to startups
THE panel discussing the topic Digital Free Trade Zone – A Leap Forward in Ecommerce on the second day of Wild Digital agreed that the next step for retail is omni-channel e-commerce.
The panel comprised Commerce.Asia founder and chairman Ganesh Bangah, Logistics Worldwide Express founder and chief executive officer Ng Chet Chiang, and Lazada Malaysia chief operations officer Kevin Lee, with Malaysia Digital Corporation CEO Yasmin Mahmood acting as moderator.
Ganesh pointed out that retail has not seen much innovation in about 20 years since the last big business model innovation of the marketplace in the early 1990s when eBay and Amazon started their businesses. He quoted Jack Ma, who said that online, offline and logistics put together make the ‘new retail’.
“The commerce industry – not e-commerce, because the ‘e’ is given – is ripe to be innovated. This is where the next great innovation that’s going to change the world is going to come from,” he said.
Omni-channel commerce is not just online-to-offline but includes using multiple e-commerce marketplaces to get your product to consumers. Ganesh cited Facebook as an example of a popular platform; the amount of sales going through Facebook in Indonesia is bigger than all other online marketplaces in the country put together.
“So, SMEs must realise that they can’t just sell on one channel anymore. You need to sell on other marketplaces besides your own platform,” he said.
This is especially so because e-commerce is everywhere. “People are buying items online across all categories, from fashion to food. If you look at how people shop today – there were more mobile sales [on Lazada] in 2016 than desktop. Everybody is so connected you can shop while you’re riding in a car, in the lift,” said Lee.
Lee added that though e-commerce has certainly been growing in Malaysia, it can still grow faster.
The Digital Free Trade Zone (DFTZ) opens up opportunities for SMEs because it promotes cross-border commerce and has the potential to catalyse the industry, said Ganesh.
However, according to Yasmin, one of the biggest challenges the digital economy faces is the fact that a lot of SMEs, especially those in traditional businesses, are not on board with e-commerce.
“There is a category of SMEs who feel threatened by us opening up the doors for products to come in from the rest of Asia. But they must realise Malaysia is not big enough to be an insular company; we have to open ourselves up for global trade,” she said, adding that good products from other countries will find their way into Malaysia with or without the DFTZ.
Ng added that many SMEs hold negative attitudes about how the DFTZ will affect their business but it is essential that this changes.
“You can’t confine your market to your own country. Many SMEs think that they are too small to go international but there are many ways to do it. If you are prepared to change there are so many opportunities around. You have to be open-minded,” he said.
Another challenge that SMEs face today is the inability to connect with startups that can provide them with the technology they need to either get on board the e-commerce ship or to step up their e-commerce game. According to Ganesh, though there are numerous startups with innovative technologies they have not been able to get SMEs on board mainly because SMEs and startups speak different languages.
“One speaks terminology and the other speaks a single language: ‘I want to make money’,” he quipped.
These reasons should not, however, stop SMEs from adopting e-commerce and grabbing the opportunities the DFTZ offers. Ganesh categorised the DFTZ as “an opportunity of a lifetime, too big to be missed”, stating that it pushed him out of retirement and inspired him to start Commerce.Asia.
According to Yasmin, the DFTZ will help open Malaysia up to global e-commerce trade and position Malaysia as a regional hub for e-commerce.