Southeast Asian e-commerce boosted by Chinese expertise

Source: Xinhua| 2019-11-03 10:57:59|Editor: huaxia
Video PlayerClose

Staff memebers work at Lazada, a major online shopping company in Southeast Asia, in Bangkok, Thailand, Oct. 21, 2019. (Xinhua/Zhang Keren)

"Southeast Asia is actually a very premature and young market with a low e-commerce penetration rate," Jack Zhang, deputy Chief Executive of Lazada Thailand, told Xinhua. "The penetration rate in Thailand was mere 3 percent, compared with that of nearly 18 percent in China with a more mature market."

BANGKOK. Nov. 2 (Xinhua) -- During the upcoming annual Nov. 11 shopping spree, a "down-to-earth" product will be available on Lazada, a leading e-commerce platform in Southeast Asia.

It is organic rice grown by aboriginal villagers in Bentong of Malaysia's central Pahang state. Although it may seem unlikely, this is an example of how the success stories of China's e-commerce boom are being copied outside the country.

Across countries of the Association of Southeast Asian Nations (ASEAN), Chinese companies and expertise are facilitating growth of the e-commerce sectors with tested technologies, logistics and operating system, opening up opportunities to people across society.


Earlier this year, Sean Lee was among a group of Malaysian entrepreneurs who attended an online start-up training program in China by e-commerce giant Alibaba, during which they visited Bainiu village, a "Taobao Village" in Zhejiang province named after Alibaba's e-commerce platform.

A "Taobao Village" refers to a village where at least 10 percent of the village households engage in e-commerce, primarily via Taobao Marketplace.

Inspired by what they saw in Bainiu village, some participants in the training program, including Lee, initiated a volunteer project named "DESA" with the hope of creating "Taobao Villages" in Malaysia, in a way to bring development to the rural areas.

Despite the idea of selling rural products was not well-received initially due to skepticism, Lee and his friends managed to persuade some villagers and has since received support by the Malaysian government and private sectors.

They are now running a pilot project to sell organic rice online with other native products like raw ginger, ginger powder and soy sauce, etc.

"Basically, we draw inspiration from the Taobao village," said Lee, "when visiting Bainiu village, we were truly inspired by it."


In recent years, e-commerce has been growing rapidly in Southeast Asia, but it remained lagged behind compared with China, said Jack Zhang, deputy Chief Executive of Lazada Thailand.

"Southeast Asia is actually a very premature and young market with a low e-commerce penetration rate," Zhang told Xinhua. "The penetration rate in Thailand was mere 3 percent, compared with that of nearly 18 percent in China with a more mature market."

Founded in 2012, Lazada is now one of the regional leading e-commerce marketplaces, with business in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. In 2016, Alibaba acquired the controlling stakes of Lazada.

"After acquiring the controlling stakes, we have been trying the integrate the six markets with a complete e-commerce ecosystem including cutting-edge technologies, logistics, and payment system," said Zhang.

The online platform was upgraded to be equipped with customization functions. The logistics network was reconstructed with now 30 storage facilities across 17 Southeast Asian cities. Meanwhile, Lazada provides a variety of payment solutions as the application of e-payment remains at a preliminary level in the region.

The upgrades provide customers with better shopping experience, while helping sellers to expand their service with less cost, said Nunthapong Boonnao, who operates a clothing shop on Lazada.

"We have introduced a series of creative measures in Thailand as it's one of the biggest markets in the region. We demonstrated how e-commerce could be run by bringing in measures like shopping sprees and live streaming. Later we expanded the measures to other five countries," said Zhang.

"In the past year, we recorded three digits growth in numbers of buyers, sellers and orders in all six countries."

Manassawee Suangkaew (R) discusses the design with a staff member at her store in Bangkok, Thailand, Oct. 21, 2019. She and a designer set up an online clothing shop in 2018 in Lazada, a major online shopping company in Southeast Asia.(Xinhua/Zhang Keren)


As governments in Southeast Asian countries are attaching greater importance to e-commerce sectors for future economic growth, Chinese companies and expertise have a greater role to play in facilitating the region to realize its potential.

"ASEAN has a high population density. Most ASEAN countries are developing countries with strong aspiration for digital economy," said Zhang, adding that Chinese companies should prioritize creating values for host countries, engage in the digital transformation of economy and society in ASEAN markets to achieve its own business and social values.

For Lee and his friends at Malaysia's DESA program, The "China Model" of e-commerce also opened up opportunities for more inclusive growth across the region, in a way to bridge inequality for people in rural areas who do not have the access to the resources like city dwellers.

They are hoping to create "Taobao Villages" not only in Malaysia but also in other ASEAN countries, as they believe there are good products in Thai or Vietnamese villages that could be sold via online platforms.

"We wish to empower villagers to embrace e-commerce and maximize their earnings, eventually producing more quality and healthy products at a reasonable pricing for consumers," said Lee.