As we draw to the end of another year, those of you retailing online will be thinking about the path forward for 2016 and the best Return on Investment (ROI) for you.
If you’ve not done so already, listing your products on marketing platforms can be a good way to test your market both in Singapore and International markets. Examples of marketing platforms include companies like eBay and Amazon (global) as well as Lazada and Zalora (SE Asia orientated).
Market-places offer a communal retail space for sellers to list their products online without the need to worry about overall operations – which remain in the control of the marketplace. In countries like the US and UK, market-places are one of the most popular shopping destinations with 44% of the Americans turning first to Amazon for their goods.
Whilst the US and other Western countries have been shopping online for almost 20 years, Singapore and SE Asia are relatively new to the eCommerce environment. However, they are catching up very quickly – assisted by the spread of wi-fi and smart – phones.
In the past few years, Singapore and SE Asia has seen the start-up of market-places like Lazada, Zalora, Qoo10, Rakuten, and Red Mart. These companies have worked hard to provide a consistent shopping experience for their customers and invested heavily in their infrastructure.
Whilst things are still developing, they’ve helped drive consumer spending online. In Singapore it was estimated online sales to be $1.1 billion in 2010 rising to $4.4 billion this year (Paypal survey).
So for companies wanting to test their eCommerce capabilities there are clear reasons why choosing a market-place, or multiple-market places may work for you. We can explore some of these benefits below:
Access to millions of potential new customers
- Listing products on a market-place provider gives you immediate access to millions of potential new customers.
- Each company enters into an agreement with the market-place whereby they will take an agreed percentage of your sales that will allow you to list your products.
- Part of this fee is used for advertising and marketing by the market-place to drive customers to your products – taking away a lot of the hard work involved.
- Purchases are made on the market-place.
- Most market-places offer a good channel to generate more sales for your business as you leverage their existing traffic, subscribers and customers. Amazon alone draws an estimated 175 million unique visitors which correlates directly to increased sales.
- As payments take place on the marketing platforms, companies don’t need to worry about facilitating this.
- Marketplaces invest heavily in marketing so that you can do less.
- Market Places are an easy, low cost way of entering overseas markets.
- Listing your products here allow retailers with little online experience or small marketing budgets the chance to test their products at a low cost in a new territory with success.
- It’s no secret that retail rental space is amongst the highest in the world in Singapore and salaries are among the best in SE Asia.
- Operating online offers companies a way to by-pass these costs and start retailing with lower costs.
Want to try it?
- Research the market places in the territory you want to retail in
- Choose one or two that look promising – some market-places will provide you with statistics on demographics, bio-demographics, top selling items and more.
- Contact them and organise to set up and account with agreed commission of sales. A contract will need to be signed agreeing these details. Please note that some market-places and some countries require you to have a local bank account and address so do check the full requirements before you sign up.
- Some market-places like eBay offer additional support in advising how to list most effectively and in what countries. It’s in their interest you are successful on their platform so are willing to help.
- List your products. Each market-place will have clear guidelines as to how your product images should be displayed, descriptions and other details. These guidelines vary between the market-places so do make sure you are aware of each one. Some – like Lazada – offer a training course to ensure you know how to list correctly.
- Monitor your account for sales and stock levels.
- Sales and payment will occur on the platform. Your money from the sale will be forwarded to you by the market-place minus the agreed commission.
- Fulfilment is mostly pushed back to your company. Some market-places, such as Zalora, have strict deadlines by which your customer must receive their goods. Others are more flexible. Again – know the rules so that you can make fulfilment within the expected times.
- Resources will still be a factor in your set up costs whether you are a small start-up or a brick and mortar wanting to get online.
- Ensure you are “market ready”
- Ensure you have an online store where you can list your products, pricing, stock id’s, monitor stock levels and record sales. This is known as your “place of truth” – where you can turn to for all accurate information regarding your sales and stock levels. Popular online shops include Shopify and Magento.
- Ensure you have company bank accounts, postal / distribution accounts and staff to handle fulfilment (if you are expecting huge volumes of sales)
- Stock – ensure you have sufficient stock and easy access to more should sales be unexpectedly high. You may want to consider a warehouse or distributor that can fulfil sales orders for you.
Advice to get online, increase sales and minimise costs
Retailing online is great for companies of all sizes but does bring it’s own challenges:
- Which marketing channels & platforms will work best for you, what territories are best for your products, what digital marketing will work best to drive traffic to your website, which agencies will work best with you.
There’s also labour involved:
- Most companies can successfully maintain around 70 SKUs on a couple of platforms before they need to consider staffing up.
In these scenarios, Cresco Data is a good partner to guide you through the maze of choosing the correct marketing channels and automating your product data feeds to vastly reduce the time required to up-load and maintain your product data online.
We are happy to share our knowledge and experience as well as give tips to improve your success. We have close relations with the major marketplaces in Singapore as well as global contacts for eBay and Amazon. Please don’t hesitate to contact us – no matter how small or large the query.
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