It may be one of the earliest players in Singapore’s e-commerce market, but Qoo10 seems to have lost some of its shine in recent years as more high-profile names such as Lazada, RedMart, Amazon, and Carousell hog the headlines.t
Still, the e-commerce site has managed to climb to pole position in Singapore based on traffic and gross merchandise volume (GMV). Launched in June 2010, Qoo10 currently has 2.5 million registered users in the country where it is headquartered. There are more than 10 million product listings on the site.
According to online shopping aggregator iPrice, for the first quarter of 2018, Qoo10 clocked the highest monthly traffic in Singapore at 13.47 million visits, followed by Lazada at 10 million. In the previous quarter, Qoo10 saw 14.41 million monthly visits compared to Lazada’s 10.87 million. The Alibaba-owned e-commerce site, however, led in ranking for both Apple App Store and Android Play Store, while Qoo10 placed third in both appstores.
Its general manager Sam Too acknowledged that Lazada was narrowing the gap and nipping at its heels. He noted, though, that the Singapore e-commerce market still was nascent and remained largely untapped.
Too said Qoo10 was “refocusing” on the city-state and tapping the market as a springboard into Southeast Asia, where it was targeting to be the region’s second-largest player in the next three to five years.
He said the company was planning for its Series C funding round this year and, if successful, would use the money to drive its expansion plans.
He said Qoo10 had spent the last five years focused on the Japanese market, which was its fastest growing and where the site rose to claim the fourth-largest share. In February, its parent company Giosis sold the local business to eBay for an amount that Too declined to reveal, but he said the deal would see eBay divesting all its shares in Giosis’ businesses outside of Japan.
While the sale gave the company a cash boost, it also meant Qoo10 would have to look elsewhere to ensure its sustainability, especially since Japan was its largest contributor, accounting for 50 percent of its GMV. Singapore was its second-largest.
“No, we’re not late,” Too said, when asked if there still were growth opportunities in the Singapore market, where the likes of Lazada–backed by Alibaba’s deep pockets and dominance in China–and Carousell and Carro with their latest funding rounds, already had been ramping up their expansion plans over the past couple of years.
While noting that Singapore was a challenging landscape, he said Qoo10 had first-mover advantage in the market where it had “groomed” the e-commerce industry a decade ago. “From out point, this industry is still only at its infancy. There is no clear winner at this point,” he said, adding that the market had the potential to grow three-fold by 2025 and another five-times by 2028.
GETTING THE SMALL TO GO BIG ONLINE
Specifically, he pointed to two key focus areas for Qoo10: small and midsize businesses (SMBs) as well as consumers aged between 35 and 45, who had only just started to shop online.
SMBs, for instance, accounted for 99 percent of Singapore’s local enterprises, but many had yet to fully engage the digital world, running websites that had little traffic, Too said.
“We want to engage these brick-and-mortar business owners and encourage them to try out e-commerce with minimum risks and resources…that’s where the [growth] potential is,” he said.
Merchants peddling their wares on Qoo10 do not have to pay a monthly subscription. Instead, the e-commerce operator takes a cut of each transaction the merchant successfully closes.
“So if they don’t see any sale on our platform, they don’t lose anything,” Too said, adding that the company had a salesforce dedicated to engaging and guiding SMBs on how to use its online tools to promote their products.
It also meant these small retailers would need to learn how to sell and manage the entire cycle of growing their business on a digital platform, including responding to customer queries and reviews.
In addition, they had to ensure their backend operations could support Qoo10’s three-hour delivery service, he said. The site processed 1.5 million transactions in the first quarter this year.
To differentiate its offerings from the competitors, he underscored the need for Qoo100 to constantly test new ideas and bring new things to the table, including new apps, news contests, and new services.
In addition, he said it was looking to bolster its grocery offering, though, by tapping different merchants to sell such products on the site, rather than storing its own inventory.
“We have mini Redmarts,” Too quipped, noting that a FMCG (fast-moving consumer goods) retail chain processed S$500,000 worth of transactions on average each month, peaking at S$800,000 last November. He revealed that the merchant, three years ago, had started by offering diapers and formula milk on Qoo10 because these items were bulky and cumbersome to store in their physical stores.
He added that the site now was exploring the use of retail outlets as pickup points, from which online customers could choose to pick up their purchases at these physical points.
Asked if the business was profitable, he declined to give specifics but said Qoo10 was focusing on its bottomline and confident it was running a sustainable business.
Apart from Singapore, the company currently operates online marketplaces in four other markets: Indonesia, Malaysia, Hong Kong, and China.
Its focus for now, though, was on Singapore, Too said, adding that it would look to ramp up its presence in Indonesia and Malaysia in about two years when these markets were “ready”. He noted that some e-commerce markets in the region remained immature and needed more time to stabilise.
