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Accessing the ASEAN Consumer Market: Fashion and Accessories (Online Sales Channels) podcast

With a tech-savvy and young population, ASEAN is often seen as the next frontier for the e-commerce market. Despite the rapid expansion over the past few years, e-commerce penetration is still only 3% of total retail sales in ASEAN.[1] For one thing, the region encompasses a broad range of ethnicities, languages, consumer preferences and regulations. Underdeveloped infrastructure and lack of familiarity with digital payment is another key constraint. One of the most common payment options, Cash-on-Delivery (COD), accounts for 50-95% of e-commerce transactions across the key markets in the region.

E-commerce in ASEAN is Reaching an Inflection Point

The recent entry of Chinese tech heavyweights into ASEAN may help to realise the region’s vast e-commerce potential. Chinese tech-related investments through companies, such as Alibaba, JD.com and Tencent have surged in 2017. The most notable examples are Alibaba’s investment in a controlling stake in Lazada and the joint venture between JD.com Inc. and Thai retailer Central Group. The new digital payment and logistics expertise associated with the Chinese investment could help ease the two major pain points that have been holding back the business-to-consumer (B2C) segment of e-commerce in ASEAN, especially for cross-border sales.

Countries with less severe physical infrastructure constraints, such as Malaysia and Thailand, are better positioned to benefit from the new wave of e-commerce development. Thailand in particular, could experience a surge in e-commerce activities over the coming years, with many ingredients coming together to enable its e-commerce to take off in the near term. Firstly, there have been high-profile alliances formed between Chinese e-commerce giants and large Thai retailers with extensive offline distribution networks, most notably the joint venture between JD.com. and Central Group, one of the leading Thai retailers. Secondly, Thailand already has decent infrastructure connectivity, and e-commerce logistics enablers have been emerging. Thirdly, the government is promoting e-payment adoption via the PromptPay scheme[2] and use of QR codes.

On the other hand, Indonesia has a great long-term e-commerce potential, given its large and fast growing middle class and young consumer market. Moreover, living in gridlocked Jakarta traffic, consumers are spending more time on the internet. In 2017, Alibaba invested US$1.1 billion into Tokopedia, the largest C2C marketplace in Indonesia. Lazada and Tokopedia account for the majority of the nation’s e-commerce web traffic, while Shopee tops the mobile apps for online shopping. While enhancing payments and logistics is important for e-commerce, online merchants should also emphasise building trust with consumers and improving the overall consumer experience, such as offering no questions returns and maintaining user reviews.

Technology Leapfrogs and Fragmented E-commerce Market

It is important to recognise that ASEAN consumers are technology ‘leapfrogs’. Outside first-tier cities, many are accessing digital platforms primarily through mobile phones. Another characteristic sets Southeast Asians apart from online shoppers in other markets: online consumers in this region choose from a large number of sites. As evidence of the market fragmentation, no retail platform is the preferred site for more than 20% of consumers in any country.[3] 

Emerging technology makes it much easier to sell through different channels, but also creates a high degree of fragmentation in the e-commerce market. Today’s ASEAN has classified platforms (Mudah and OLX), C2C sites (Tarad, Tokopedia, Bukalapak, Shopee), B2C (Lazada, Zalora, MatahariMall) and brands’ own sites. In ASEAN, fashion brands sell via marketplaces like Lazada and Zalora, their own websites, as well as distributing through e-tailers like Central Online and PT MAP Boga Adiperkasa (MAP Group).

Major Online Fashion Platforms in ASEAN

The e-commerce scene in ASEAN is still evolving. There are a few key regional players and many local fashion verticals.

Summary of Major Online Fashion Platforms in ASEAN
PlatformsE-commerce ModeMajor ASEAN Markets
LazadaB2CIndonesia, Malaysia, The Philippines, Singapore, Thailand, Vietnam
ShopeeC2CIndonesia, Malaysia, The Philippines, Singapore, Thailand, Vietnam
ZaloraB2CIndonesia, Malaysia, The Philippines, Singapore, Thailand, Vietnam, Brunei
ZilingoB2C and B2BBangkok, Singapore, Indonesia
Love, BonitoB2CSingapore, Indonesia, Malaysia
ReebonzB2CIndonesia, Malaysia, Singapore, Thailand
DressabelleB2CSingapore, Malaysia
PomeloB2CThailand, Indonesia

Selling on the Key Marketplaces


Lazada is a key B2C marketplace in the region with presence in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. A seller wishing to list on Lazada have to submit documentary proof of authorised distributorship. The marketplace constantly monitors product information provided by its sellers to ensure that all items offered for sale on Lazada comply with laws and regulations, as well as to combat counterfeit merchandise.

Lazada’s online merchants do not have to pay listing fees, they pay a commission (with the rates based on product category) only when the products are sold. Lazada provides sellers with a wide range of business management, distribution tools and logistic programmes. Sellers just need to stick the label on the parcel and deliver it to one of Lazada’s sorting centres in Asia (Hong Kong, Shenzhen and Korea); Lazada’s cross-border logistic team will then take care of the rest, which includes export and import paperwork, customs clearance, and last-mile delivery. In general, cross-border delivery takes three days, if the product is already in the local warehouse, it will take one day for delivery.

Currently, Lazada accounts for 40-60% of all small parcels in some of its key ASEAN markets. Today, a shipment pre-alert is often sent to customs several days prior to the expected arrival date. This notice allows the customs time to prepare for the arrival.

Lazada offers multiple payment methods: cash on delivery, credit/debit card, Lazada Wallet, PayPal, AMEX, as well as Instalment Payment Plan.[4]

At the time of writing this report, Lazada’s sign-up link for new cross-border sellers is suspended while local sellers are not affected. For Hong Kong sellers with local operations in any of the six ASEAN nations, they can sign up as a local seller.


As a fast-growing peer-to-peer platform in the region, Shopee focuses on helping small businesses and budding retail entrepreneurs to grow by solving key challenges, such as high capital needs and lack of business knowledge. Sellers can organise inventory, manage buyers, and measure online stores’ performance with Shopee’s Seller Assistant feature, which is accessible on a mobile phone. Cross-border sellers from China and Hong Kong can also sell to ASEAN consumers via Shopee.

The platform provides an in-app chat feature that allows potential customers to communicate with sellers about a product and make transactions directly. This feature is popular among buyers as they can have direct contact with the sellers for negotiating the prices and learning more about the product.

There are just few simple steps for sellers to upload and sell products on Shopee. Sellers’ product listings are vetted to ensure they are not illegal. Since almost anyone can start selling on the platform, sellers are bound to face a high number of competitors who may be selling the same product. And, for the same reason, customers are bound to be more careful about sellers on Shopee. According to Shopee, successful sellers are those who proactively study the local market’s product trends and select the right products with competitive pricing. A good customer service attitude when handling in-app chats with buyers is also crucial. Customer reviews and ratings are effective ways for buyers to know if a seller is trustworthy.

Shopee supports several payment methods including credit/debit card, bank transfer, online banking, and Shopee Wallet. Users can also earn Shopee coins (Rewards) whenever they buy on Shopee to encourage them to use these earned coins to rebate off their items.

Social Commerce

Given the high mobile phone penetration in ASEAN, the fact that the ASEAN consumers are reluctant to share their financial and personal information online, and less than 20% of the population (except Singapore) using either debit or credit card to make payments[5], shopping via social networks has a natural appeal in the region.

In Thailand, for instance, the vast majority of online shoppers make purchases through social media, making it one of the biggest social commerce markets in the world. Kerry Express in Thailand indicated that about 65% of its deliveries are generated from C2C market, which consist of many social commerce orders. Facebook has chosen Thailand as the first test base for social commerce payments and Facebook Shop. However, social commerce is tricky to measure because the negotiation and transaction happen online, but payment typically happens offline.

Instagram and Facebook are increasingly used as sales and marketing channels for fashion and accessories. When an ASEAN consumer is browsing Instagram or Facebook, it is likely that he or she will come across sponsored posts from many unknown brands selling clothes, shoes, hats, fashionable jewellery, and other accessories. In social commerce, an order is usually made online while payment is offline. Merchants set up ‘shops’ on Facebook or Instagram, posting images and details of goods for sale. Shoppers browse, inquire about product availability and arrange a method of payment, typically a bank transfer, through a popular chat app, such as LINE in Thailand.

In Thailand, it is common for sellers to indicate their LINE account for people who have enquiries. The seller and buyer can communicate and negotiate on LINE, where the sellers send details of their bank accounts for payment transfer. The purchase process is simple when compared to filling forms and providing payment card details when shopping on a typical e-commerce site. Social commerce presents a great opportunity for small suppliers or non-brands to test consumer markets in ASEAN without too much financial commitment.

Major Difference Between Selling via Marketplaces and Social Media

MarketplacesSocial Commerce
Traffic GenerationBuy banner ads or become a sales leaderCircle of friends and social media ads
Marketing and PromotionMarketing tools are available for merchants (at a fee)Through word of mouth or buy ads from social media
Customer OwnershipMarketplacesSellers
Payment MethodsOffered by Marketplaces (e.g. credit card, COD etc.)Typically COD or bank transfers
Logistics/deliveryLogistic programmes offered by MarketplacesCan use whatever service providers available

[1]  Bain Report “Can Southeast Asia Live Up to Its E-commerce Potential?”, Bain & Company (2016).

[2]  PromptPay is an interbank mobile payments system in Thailand, one of several initiatives under the Thai government’s National E-payment Initiative.

[3]  Bain Report “Can Southeast Asia Live Up to Its E-commerce Potential?”, Bain & Company (2016).

[4]  For more details on each payment method, please refer to Lazada Singapore – Payments

[5] World Bank (2015). “The Little Data Book on Financial Inclusion”


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Content provided by Picture: Jacqueline Yuen
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