AFTER almost a decade since the establishment of Lazada Malaysia in 2012, the local ecommerce market saw an explosive growth from its nascent stages to become a booming and all-encompassing industry.
Nine years in, Lazada’s ecommerce ecosystem has become a cultural phenomenon that has cultivated an online shopping community nationwide, spurred digitalisation for hundreds of thousands of local businesses, shaped the next generation of consumer behaviour, and created thousands of logistics work opportunities for Malaysians.
This is known as the Lazada Effect.
‘We call this the Lazada Effect – our support in future-proofing local businesses and making everyday life just a little easier for all Malaysians,’ said Lazada Malaysia CEO Magnus Ekbom.
"In the early days of Lazada, online shopping seemed to be an unfamiliar concept for Malaysians, ” said Magnus Ekbom, chief executive officer of Lazada Malaysia and chief strategy officer of Lazada Group.
“SMEs and brands were understandably uncertain about ecommerce back then. We were relatively unknown and during our early days even the leadership team often spent whole weekends in the warehouse to pick and pack orders manually.
“As we celebrate Lazada’s ninth birthday this coming March 27, ecommerce has grown to be a staple in almost every household, with more than one-third of the local population shopping on the Lazada app every month.
“We will continue our pioneering spirit to trailblaze the future of ecommerce for the country, by making the digital economy accessible to the local community of customers, brands, and sellers, ” he said.
Lazada’s ecommerce ecosystem has become a cultural phenomenon that has cultivated an online shopping community nationwide.
New era of retail commerce
Being one of the first major ecommerce players in Malaysia, Lazada has been a key driver of digital transformation for both local small and medium-size enterprises (SMEs) as well as large corporations.
Through its ecosystem of first-to-last-mile logistics, innovative seller tools, and comprehensive Lazada University training, the Lazada Effect has upskilled and flattened the barriers of entry for local entrepreneurs at the grassroots level – empowering local SMEs with access to the digital economy. This gave rise to the next generation of homegrown online businesses.
“My background is in chemical engineering, so when I started my online business selling home appliances back in 2014, I had zero knowledge of ecommerce. Not a lot of people knew how to run an online business back then, ” said Russell Taylors founder Satish Raguchandran.
“Despite being unfamiliar and inexperienced, I was able to grow my business on Lazada Malaysia and be guided by Lazada University every step of the way – from basic product listings to advanced business analytics.
“Russell Taylors was also relatively small and didn’t have much resources nor manpower at the time, so I utilised the Fulfilled By Lazada (FBL) logistics service to outsource warehousing, product packing, and delivery.
“After being on the ecommerce platform for seven years now, my business has grown more than 100 times and generate up to RM2mil in sales per day during campaign periods.”
Collaboration with leading industry partners, like Lazada, provides greater accessibility to training and tools needed for local entrepreneurs and talents to digitalise and be part of the ecommerce ecosystem,’ said MDEC CEO Surina Shukri.
Malaysia Digital Economy Corporation (MDEC) chief executive officer Surina Shukri commented: “The recent disruption caused by Covid-19 necessitates businesses and SMEs to digitalise in order to remain sustainable and thrive in the digital age.
“As we adopt a whole-of-nation approach towards accelerating the digital economy, MDEC will continue to collaborate with leading industry partners, like Lazada, to provide greater accessibility to training and tools that local entrepreneurs and talents need, to digitalise and be part of the eCommerce ecosystem.”
With online shopping demand soaring, the benchmark of logistics capabilities also rose.
This has created thousands of logistics work opportunities for the B40 community, that can reach up to five-digit monthly income for delivery personnel.
“Backed by our nationwide network of wholly-owned warehouses and over 40 fulfilment hubs across Malaysia, Lazada has rapidly grown our logistics capabilities to manage large order volumes for our sellers and brands, while providing timely deliveries for our customers, ” said Lazada Malaysia chief logistics officer Olivier Petra.
“In 2020, we managed to fulfil an order to a customer in Subang Jaya in under 21 minutes upon checkout, ” he said.
Meanwhile, Ho Choy Yok, a delivery driver with Lazada Express (LEX), said: “I was previously an account executive for over 13 years. Last March, I explored working as an independent contractor to deliver packages for Lazada.
“It has just been a little over a year now, and I was able to earn up to over RM9,000 in a single month, far more than what I was making before.”
Beyond the ecommerce supply chain, the Lazada Effect has also created alternative income opportunities by bringing the “Shoppertainment” concept to the country.
In-app features such as the LazLive livestreaming function as well as LazGames and LazCoins gamification features have fundamentally changed the way Malaysians shop. The local online consumer behaviour has shifted from purely transactions to more social experiences that merge shopping with entertainment.
Last year, over 1.1 million minutes of LazLive content was aired and Malaysians spent a total of 3.4 million hours playing LazGames. As more Malaysians adopt the shoppertainment lifestyle, livestreamers became a viable outlet for creatives to earn a living from home through affiliate sales.
“I have been hosting events for more than 12 years now. When the pandemic hit, I was struggling financially because there aren’t any events and shows, which meant I basically had no income for about six months straight, ” said Shaun Stephen, a KL-based LazTalent streamer on LazLive.
“It was a frightening time for my wife and me, especially with a kid coming along. Since I became a LazTalent streamer on LazLive, I’ve regularly worked alongside renowned brands to engage with their customers and also had opportunities to be featured on national television, which skyrocketed my career.”
New customers fuelling digital economic growth
The LazMall channel which guarantees brand authenticity and timely delivery, as well as the Lazada Wallet payment solution which ensures secure and seamless transactions, are some of the key innovations that continuously built consumer trust by elevating the digital customer experience.
Across almost a decade of the Lazada Effect, Malaysians’ online shopping appetite has since expanded from mostly electronic devices initially, to also everyday lifestyle and essentials.
In addition to electronics which remains one of the bestsellers today, household goods, beauty cosmetics, fashion, baby supplies and groceries are now among the top 10 categories on Lazada.
“Through Lazada’s platform, Senheng has established greater digital presence across the country to meet the rising demand of digitally-savvy Malaysians, ” said Senheng Malaysia executive chairman Lim Kim Heng.
“The Senheng PlusOne Lazada membership offers an extended one-year warranty to assure customers of our product quality, and also provides loyalty points to reward repeat customers.
“Today, Senheng’s LazMall Flagship Store is grossing at over RM30mil in sales in just a year and has a loyal store following of more than 150,000 Malaysians.”
HABIB Jewels executive director Datuk Seri Meer Sadik Habib said: “Malaysians have grown so accustomed to shopping online that it is now etched in our daily lifestyle. It is not limited to just low-priced items because customers now have the confidence to spend on high-value products online too, as we’ve sold items worth over RM40,000 through LazMall.
“HABIB has enjoyed a great working relationship with Lazada since 2017 and we are proud to be part of the many marketing efforts by Lazada.”
Come March 27, the Lazada Effect would have spanned across nine years of Malaysia’s history. Lazada is committed to further strengthening its ecommerce ecosystem and will continue to be a catalyst that will propel the nation’s digital economy to new heights.
Click here to learn more about Lazada and its birthday sale on March 27,2021.
