How SMEs Can Ride on eCommerce Opportunities in Asia Pacific By Yvonne Lim

July 2015

Vision & Mission

1000+ eCommerce Clients

S$4 billion market cap

A+ Credit Rating*

FULL SERVICE ECOMMERCE LEADER IN APAC

Localized front end, payments,

order & store management

Logistics Centers

24 4 Call Centers 200+ Countries

delivery

Digital Evolution Index eCommerce Growth

Top eCommerce Sales in 2015

20% Growth annually

A DIGITALLY ADVANCED REGION

Singapore is the only SE Asia country in the global top 16

Staggering Internet Penetration

Mobile Commerce on the rise

Key Growth Drivers 1. Growing domestic consumption – Driven by a spending middle class. 2. More purchasing power - Disposable income per capita expected to rise from US$3,000 (2013) to more than

US$5,000 by 2018. 3. Growing internet penetration - 600M internet users in 2013, with 53M new users in that year alone. 4. Rising adoption of online shopping - Estimated 300M shopped online in 2014. 5. More efficient logistics ecosystem - Greater connectivity through increased investments in logistics

infrastructure

CHINA – BOOM IN ASIA PROJECT TO REACH US$718 BN BY 2017

Confidential : All materials in this presentation must not be shared

ID SG PH VN TH MY Aggregate China

Population (mn) 244.8 5.3 97.7 88.8 67.9 29.5 534.0 1,344.0

# Online (mn) 75.9 3.9 33.6 31 31.2 18.5 194.2 618.0

% Online 31.0% 74.0% 34.4% 35.0% 46.0% 62.6% 36.4% 46.0%

Retail sales (US$ bn) 100.2 29.6 34.0 79.6 94.4 98.2 436.0 3,812.0

eCommerce % of retail 0.1% 1.0% 0.3% 0.1% 0.2% 0.2% 0.2% 8.0%

Opportunity (US$ bn) by 2020 at 8% retail

sales 8.0 2.4 2.7 6.4 7.6 7.9 34.9

SEA eCommerce Market (2013)

Source: UBS

SEA’s growth mirrors growth patterns of China

• SEA’s inflection point for eCommerce is 2013/2014 shows the same drivers as China. • Internet & mobile penetration continue to increase - Internet penetration expected to increase to 48%

within three years. Mobile is driving eCommerce, with majority of traffic coming from mobile devices. • Growing economies - SEA ‘s GDP expected to grow at nominal rate of 11.5% year over year till 2017. • High social media penetration – Jakarta, Indonesia is “social media capital of the world” • eCommerce is not limited to metropolitan areas - Similar to China; rural areas with poor access to

products will drive growth. • ASEAN Economic Community (AEC) will open borders and further stimulate cross-border eCommerce.

Confidential : All materials in this presentation must not be shared

SEA B2C ECOMMERCE MARKET US$35 BN OPPORTUNITY BY 2020

Growing Internet Penetration (although not homogenous)

Growing Consumer Spending

Social Media A Driver for eCommerce

Mobile is Massive

Changing Trends in eCommerce Payment Solutions

Marketplaces Play A Dominant Role

Prevalence of Cross-border Trade

KEY CHARACTERISTICS OF OUR ECOMMERCE LANDSCAPE

IMPORTANCE OF MOBILE

LOCALIZE: SINGAPORE Wide usage of credit cards, largest percentage of population spending money online, long “peak holiday” season of 4 months (between Nov – Feb), due to combination of US/UK online seasons. Can you scale?

LOCALIZE: MALAYSIA Festival promotions, local online purchase channels, payment methods, customer care and communication channels.

LOCALIZE: THAILAND & OTHER SEA Social media is a greater influencer than anyone previously thought. Line, Kik, Whatsapp, BB Pins, Instagram, Pinterest, Wechat, Viber, Kaokao.. Select wisely and resourcefully.

Source: Forrester Research

CUSTOMERS HAVE THE POWER

Key Success Factor

Recurring Transactions without Recurring Marketing

Make Returning Customers Your Key Objective

CUSTOMER AT HEART OF YOUR BIZ

Wide Product Selection

Savings and Value

Honesty and Transparency

Legitimate and Quality Goods

WHAT DOES YOUR CUSTOMER WANT

Triumph #20YearsOfMaximizerMagic

KNOW YOUR CUSTOMERS A TRIUMPH EXAMPLE

• Formula good basis for projecting sales & digital expenses in first couple of years

• Third party shippers are experts in local regulatory conditions

• Started soft launch w/o advertising

• Doing homework/analysis on competitors & local cultural differences like keywords key towards digital investment & critical for success

• Recommend separate line item in P & L for Int’l digital advertising to make sure in line with Int’l sales for solid ROI

Free Returns Free Shipping Listing Est Delivery Time

Local Customer Support

Conversion Rate

+48% +47% +60% +36%

Repeated Sales

+47% +50% -

Friend Referrals

+33% - -

Actionable Items

Other Tips

IMPACT OF CUSTOMER EXPERIENCE

ON REVENUE

21

20

35

32

34

4.5

14

15

0

3

1

2.8

0% 20% 40% 60% 80% 100%

Prices in Local Currency

Final Landed Costs

Local Payment Methods

Local Customer Support

Free Returns

Free Exchanges

No

Yes

Best addressed through setting up a localised eCommerce operation or outsourcing to regional end-to-end provider.

IMPROVING YOUR CUSTOMER

EXPERIENCE & SATISFACTION

Sources: Custora report derived from 72 million customers from 86 US retailers across 14 industries, June 2013 RJ Metrics Summer 2012 E-commerce Benchmark

CLV is slightly higher for customers originating from

FB than Google

US$148 US$159

CUSTOMER LIFETIME VALUE DRIVERS

SCALABILITY IS ESSENTIAL

eCommerce Technology&Payment Performance Marketing Regional Customer Care

Warehousing & Fulfillment

Merchandizing and Store Management

Delivery & Returns Management

ECOMMERCE AS A SERVICE SAME STRUGGLES IN COMPANIES OF ALL SIZES

Warehousing Cost/Flexibility

Marketing Scale

Fulfilment & Returns

eCommerce Store Management

Regional Expansion

Managing multiple online sales channels ranging from own site to marketplaces

Measuring & understand customer behavior for targeted advertising to drive conversions

Pressure from increasing fixed and variable costs, reliable SLAs

Market knowledge, cross-border commerce, ability to scale

TOP ECOMMERCE SME CHALLENGES PICK YOUR BATTLES – ONE AT A TIME

WHAT DO SMES WANT PICK YOUR BATTLES – KEEP YOUR CORE

Keep comparing yourself against

competitors

Standardization of processes and workflow Outsourcing Vs

In-house

Find Your Niche

Market & Consumer Research

Conduct overall market research, determine your demand & competitor analysis

Size Your Opportunity Look at online retail %, offline $ vs online S,

existing brand site’s traffic, conversion rate analysis

Determine Your eCommerce Technology Requirements

eComm Platform, Content Management, Order Management System

Consider Logistics, Custom Duties & Legal Frameworks

Research the requirements in each market you want to enter

Market & Drive Traffic to Your Site

Conduct key word analysis to understand local market requirements and search behaviour

PLANNING YOUR MARKET ENTRY

Eat Data Analytics for Breakfast

Offer Convenient Methods of Deliveries and Returns

Offer Localized Payment Solutions to Suit Your Target Markets

Leverage Social to Drive Sales

Customer First

Ensure You Have Clear Inventory Visibility

Build an Ecosystem of Trusted Partners

ECOMM BEST PRACTICE CHECKLIST

Create A Seamless Customer Experience Across Channels

Transform the way you sell online

ezyCommerce is an easy-to-use, low-cost, fully-integrated, cloud-based eCommerce Fulfillment Solution for SMEs.

Thank you. Q&A? More resources in our Knowledge Centre.

http://www.specommerce.com/knowledge-centre/

Yvonne Lim Director Ecommerce Enterprise Solutions http://linkedin.com/in/yvonneljy