Alan Chan, CEO of Lazada Malaysia
PETALING JAYA: Consumer behaviour is fluid where the rules are rapidly rewritten all the time. Therefore, it is crucial for businesses to be able to adapt and turn every tide to their favour, or risk getting left behind.
Lazada Malaysia chief executive officer, Alan Chan, told StarBiz, “We were relevant to consumers during the Covid-19 pandemic. As an eCommerce platform, Lazada was classified as one of the essential services in the country.
“However, post-pandemic, things are gradually normalising and consumers are once again confronted with choices. How then can we remain relevant, if not more relevant now to our customers.”
Chan added that for this, understanding customers’ needs is essential.
“During the pandemic, customers are mostly buying essential products, like groceries, as well as household and home improvement items. But now they are making a turn in their buying behaviour, towards fashion, beauty, and back-to-school items as well as baby necessities. Hence, we at Lazada are keeping up with the change.
“I think the mark to saying that we are truly relevant is when we become a household name,” he said
In terms of the amount of retail spending that is done online, Chan noted that the data implied that there is still significant room for growth for eCommerce businesses.
“In Malaysia, only 9% of retail spending is carried out online. Countries like the United States and China are seeing 32% to 33% and 28% to 29% of online retail buying, respectively. “Therefore, there is a huge space for us to grow by providing customers with better pricing, and delivery services. This will enable them to move more of their conveniences online,” he said.
When it comes down to it, consistent delivery is what keeps customers happy.
“Having quality products, competitive prices, free shipping, stackable vouchers and reliable delivery are some of the reasons why customers keep coming back to shop on Lazada.
“Hence quality assurance is very crucial. Once those promises are not kept, it will be difficult to keep customers loyal to the platform,” he stated.
Lazada has recently launched its RM9.90 all in segment on its platform that can allow customers to stretch their money further.
“Given the rising cost of living, many customers are looking for more affordable items. However, at the same time, they may also hope to buy the newest iPhone, for example. LazMall, the authenticity guaranteed destination for branded goods, can fulfill their needs” said Chan.
In a fast-paced digital world, change is the only constant. As such, businesses can no longer be content to just deliver the basics. Instead, they must constantly pivot and innovate new ways to broaden and deepen their penetration in the market.
Interestingly, Lazada has employed artificial intelligence and augmented reality in its beauty segment, through the introduction of the virtual try-on feature that allows users to preview their looks without the need for physical product sampling.
“There is a very good opportunity for us to expand this feature into our fashion segment as it can help users to have a proper view of how they will look in a particular piece of clothing before making the purchase,” said Chan.
It does not stop here, but more intrinsically, the company is leveraging on its know-how in eCommerce to facilitate its shift towards online-to-offline retail by collaborating with other brands.
“When brands approach us for a collaboration, aside from expanding their operations and building their customer base, these brands also look to enhance their marketing innovation.
“While they have a product, we have the means to help them to digitalise their business. In Lazada, we believe in empowering our brand partners, sellers and employees through the right solutions and technology,” said Chan.
Lazada has tied up with Malaysian Digital Economy Corp (MDEC) via the DE Dagang initiative to help local micro small and medium enterprises (MSMEs) to grow their businesses. “While established brands have a more stable footing, it is the MSMEs that need a lot of hand holding.
“This is where our collaboration with different ministries like MDEC are important.
“Through DE Dagang we collaborate with the government to equip merchants and sellers with the necessary knowledge to market their products on eCommerce platforms, from photo-taking skills of products to keeping track of inventory,” said Chan.
Apart from this, Lazada also holds masterclasses under their flagship programme, Lazada University.
“Lazada University is specifically for our sellers. Under this programme, we teach them very practical things, like how to measure return on investment. Our masterclass also serves as a networking space for the participants,” Chan said.
He added that this is in line with the company’s values to have the needs of its customers in the forefront of its operations.
“There is a saying in our company, customers first, employees second and shareholders third. In the industry, there is always much to consider. It is a very noisy environment. But ultimately, going back to our core value, customers first, will steer us towards the right direction,” said Chan.
Adding on to that, Lazada’s effective business model to scale sustainably by being careful in deploying its finances is another attributable factor to the growth that it has chartered so far.
“We want to be responsible stewards of the investment that we have. For example, in spending on advertising, we always check to see if it is sustainable or whether we are just trying to catch the wave and burn money. This is why unlike other businesses who are facing challenges, Lazada is still able to bring in new hires in big batches.
“There are always two extremes; expand aggressively or be financially sustainable. However, given our disciplined operations for the past few years, these two things are achievable. This is also how we are differentiated in the market,” said Chan.
