Lazada is gearing up for an even stronger showing in 2018, as it expects greater growth in the e-commerce industry in Malaysia next year. It has predicted an increase of 2 million new online shopping customers, as well as a 30% increase in frequency of online shopping among Malaysians in 2018.
To drive this predictions into reality, the company is doubling down on new technologies and adapt innovative ideas from its parent company, Alibaba. Lazada Malaysia CEO, Hans-Peter Ressel, revealed that the company is working on a brand new Lazada app, driven by artificial intelligence (AI).
Not much was revealed at yesterday’s panel discussion organised by Lazada on 2018’s online e-commerce trends, but the company expects to reveal the new app by the end of the year. According to Ressel, the new app has been revamped to provide a highly personalised browsing experience for each individual user. There will be less emphasis on product categories, and instead the app’s machine-learning algorithms will show off more products that the individual is interested in based on purchase and viewing history.
And because there are machine learning models at work, the app will get better over time at showing the platform’s 100 million items available for sale. Other factors such as seasonal celebrations and events may also be part of the algorithm – but of course, Ressel did not elaborate more on this end.
On a separate note, Lazada Malaysia is also looking to its parent company, Alibaba, to introduce new innovations and improve the online shopping experience in Malaysia. One area the company is looking to introduce is improvements in the online-to-offline (O2O) experience. Currently, Lazada already offers services such as payment options in 7-eleven outlets and parcel drop-off and pick-up services with a number of partners. It is now looking at another interesting feature, where customers can view items in a physical store and buying them online.
This feature is partly inspired by Alibaba’s Hema stores in China, where customers can walk in and browse for groceries in store, pay with a digital wallet, and have the groceries delivered to their homes within 30 minutes. For Lazada Malaysia, the approach is slightly different: instead of groceries, the company is looking at products that customers prefer to physically view before buying.
For example, audio-visual products like TVs and speakers are highly subjective, given the different consumer preferences. Many consumers still purchase these items in store after viewing them physically, but there are also others who view them physically first – and then buy them online.
This is the part where Lazada wants to eliminate. The company is in talks with a number of merchants to allow offline customers to purchase the product online and have it delivered to their homes. This actually has a few benefits for the customer as well as the merchant. The customer does not have to carry a huge amount of cash when buying the item, and does not have to transport a potentially large and fragile product home. For the merchant, stocks do not need to be stored in the retail outlet, allowing for a centralised distribution centre directly from the warehouse. This saves costs, as well as providing additional space at the retail outlet.
To start off, Lazada has identified products which customers prefer to view physically before making a purchasing decision. From there, the company approached several merchants to discuss this new venture – nobody has yet done this in Malaysia, but with the scale and resources available to it, Lazada definitely could make this happen. The company, naturally, did not reveal which merchants it is currently discussing with.
These are just two of many more initiatives Lazada Malaysia is working on as it looks to further cement its place as the top e-commerce platform in the country. It is also working closely with partners such as Pos Malaysia, SME Corp, and a variety of major brands and distributors to spearhead the e-commerce development in Malaysia.