For home-based and micro businesses, social media tools such as Instagram Shop and WhatsApp are viable ways to run an online operation. However, operating and maintaining an online or e-commerce store poses a significantly more formidable challenge.
According to the JP Morgan 2020 E-commerce Payments Trends Report, Malaysia’s business-to-consumer e-commerce market is growing at a healthy compound annual growth rate of 17%. However, the country’s e-commerce infrastructure, such as product availability, payments, delivery and regulatory requirements, have yet to catch up with more established online shopping markets.
This observation is shared by LamboPlace group CEO Datuk Jason Yap. Many small and medium enterprises (SMEs), he notes, lack the expertise to set up and run an online business, and are forced to hire experts or upskill their existing talents to assist in the company’s digital transformation.
“From what I’ve seen, the majority of struggling SMEs are stuck; a lack of talent being the No 1 issue. You might have five staff members running a store, managing the inventory and books and, all of a sudden, they now have to learn how to sell their products online because of Covid-19. This is a big challenge for many of them,” Yap explains.
He says many small businesses have the misconception that setting up an online business is an immediate, one-time process, but it is actually only the first step. In reality, growing and maintaining the online business is a long and arduous process. It may include aspects such as re-evaluating store prices on an ongoing basis, restructuring different assortments of product combinations, having customer service for refunding and delivery matters, and continually updating the graphics and writing content for the listing platform.
LamboPlace is a home-grown e-commerce platform established to resolve many of these issues on behalf of SMEs, easing the transitional pains of setting up an online business. It assists vendors in customer service, running offline and digital advertising campaigns, and even provides onboarding and fulfilment services, alleviating the need to employ additional staff members.
“We are not just an e-commerce platform where you list your products up for sale. We provide an established ecosystem that simplifies about 70% of the difficulties faced by SMEs when trying to sell products online, including deliveries, which happens to be one of the biggest issues [they face],” says Yap.
He also notes that funding and capital expenses are significant problems for many SMEs in the current Covid-19 pandemic landscape. To lower the barriers to entry, LamboPlace does not charge vendors sign-up fees.
The platform operates on a commission basis — for each successful sale transaction, it receives a commission of 5% to 50%, depending on the product range and pricing. Yap says LamboPlace primarily targets brand owners or direct manufacturers and sells directly to consumers, eliminating the need for the product to change hands multiple times, which drives up the final price of the product.
Becoming a LamboPlace vendor is an easy three-step process, he says. The SME would first need to sign up for an account online and submit the necessary documents for LamboPlace to verify its identity.
The vendor management team would then reach out to the SME and guide it through its product information and stock-keeping units submissions. Once both the business identity and products are properly verified, the vendor’s store is ready to go online.
Yap points out that although LamboPlace is a full-fledged e-commerce platform, it also serves as a testing ground for SMEs to start selling their products online before fully committing resources to set up their own full-fledged online business infrastructure.
He hopes that LamboPlace’s low barriers to entry will help position it as the go-to e-commerce platform for SMEs to kick-start their online business journey.
Standing out in a crowded space
The Malaysian e-commerce scene is currently dominated by large players such as Shopee and Lazada, which have captured large swathes of the local market. To stand out among the heavy competition, LamboPlace upholds the policy of only accepting one product listing from each brand.
Yap explains that visual clutter, multiple listings of the same product and fraudulent listings are the main factors that severely affect the online shopping experience of many Malaysian consumers.
He says not only do customers have to battle decision paralysis when picking out items to purchase, they also often have to spend hours researching where to obtain the best deals while not compromising on the chances of receiving a counterfeit product.
By only accepting one listing per brand product, consumers do not need to sift through multiple reviews and verify if a product is genuine or not. Unlike other e-commerce platforms where the vendors are in charge of updating their store pages and product listings, LamboPlace manages the product listings and content on the site.
Yap also stresses that LamboPlace only accepts verified vendors, official retailers and brand owners. In addition, the LamboPlace webpage and app is designed intentionally to be free of excessive advertisements or mini-flash games that will hinder the customer experience.
Yap believes that focusing on delivering a great online shopping experience will enable it to stand out amid all the noise in the industry, the way a high-end grocer differentiates itself from a hypermarket despite selling the same products.
“When our customers misplace an order or do not receive what they want, most of the time we initiate a refund request, no questions asked. Even recently, we had a price input error where there was a price discrepancy, but we honoured the lower price and the customer was happy with the outcome,” says Yap.
“The customer journey is an interesting topic because there are a lot of steps involved in converting a first-time customer into a loyal, returning customer. Our objective is to hit as high of a return rate as possible by making sure that they are enjoying the online shopping experience.”