GEPI - Startup Talk E-Commerce by Fun Fuk Lestario
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GEPI - Startup Talk E-Commerce by Fun Fuk Lestario

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GEPI - Startup Talk E-Commerce by Fun Fuk Lestario GEPI - Startup Talk E-Commerce by Fun Fuk Lestario Presentation Transcript

  • eCommerce Basics Fuk Oleh: Fung Lestario Global Entrepreneurship Program Indonesia (GEPI)
  • Definit ion “Buyi &selli goo &servi electroni ng ng ds ces cally” Global Entrepreneurship 2
  • Conte nts 1 2 Indonesian eCommerce Landscape Compet Environ &Strate itive ment gies Global Entrepreneurship 3
  • Conte nts 1 2 Indone eComm Landsc sian erce ape Competitive Environment & Strategies Global Entrepreneurship 4
  • Fiv ke eleme o eComm e y nts f erce Demand Technology Connectivity Payment Logistics Global Entrepreneurship 5
  • Fiv ke eleme o eComm e y nts f erce Demand Technology Connectivity Payment Global Entrepreneurship 6
  • Demand Ve stro dema poten ry ng nd tial 250 Million pop. Median age: 28.5 years old Rising middle class Urban pop.: 51% of total Global Entrepreneurship 7
  • Demand Ve stro demand ry ng potential 250 Million pop. Median age: 28.5 years old Rising middle class Urban pop.: 51% of total Global Entrepreneurship 8
  • Demand Ve stro demand ry ng potential 28.5 years old Median age: Source: CIA World Factbook Global Entrepreneurship 9
  • Demand Ve stro demand ry ng potential 28.5 years old Median age: Source: redwingasia.com Global Entrepreneurship 1
  • Demand Ve stro demand ry ng potential 250 Million pop. Median age: 28.5 years old Rising middle class Urban pop.: 51% of total Global Entrepreneurship 1
  • Demand Ve stro demand ry ng potential Class Rising Middle Source: BCG Global Entrepreneurship 1
  • Demand Ve stro demand ry ng potential 250 Million pop. Median age: 28.5 years old Rising middle class Urban pop.: 51% of total Global Entrepreneurship 1
  • Fiv ke eleme o eComm e y nts f erce Demand Technology Connectivity Payment Global Entrepreneurship 1
  • Connectivity Lo ba of internet users grow w se butInternet users (as % of th good population) 9 0 80 7 7 4 5 70 7 74 8 7 71 8 69 69 56 56 7 7 8 9 71 8 7 1 9 7466 71 61 56 60 50 4 0 34 29 23 30 8 20 10 0 Source: ITU 20 08 20 United 09 Jap States an 20 10 Singap ore Malay sia Global Entrepreneurship 15 12 11 7 42 38 20 11 Chi na Indon esia 20 12 1
  • Connectivity 1, 6 1,3 1, 4 4 1, 2 1, 0 0, Sol growth in mobile-phone id subscribers Mobile phone subscribers (avg. phone ownership per 1,4 person) 1,3 9 0,87 0,86 8 0, 6 0, 0,6 0 0 20 08 Source: ITU 1,19 1,08 1,01 4 0, 2 0, 5 0,48 0,92 0,89 0,6 9 0,56 20 Singap09 Malay ore sia 1,5 0 1,27 0 8 , 0,97 8 201 0 Indonesia 1,0 2 0,9 2 1,05 0,95 0,64 Global Entrepreneurship 1,1 1,0 5 9 0,98 0,81 0,73 2011 Jap an 1,5 1,41 3 United States 20 12 China 1
  • Connectivity Very good growth potential hence fo eComm for smartphones, conducive r erce Source: redwingasia.com Global Entrepreneurship 1
  • Fiv ke eleme o eComm e y nts f erce Demand Technology Connectivity Logistics Payment Global Entrepreneurship 1
  • Logistics Count ry Indonesia overall logistics behind most lags performance countries in ASEAN LPI LPI Custo Infrastru International Logistics Rank Score ms Singapor e Hong 1 Kong, China 3 Finland 2 4 8 cture shipments competence 4.1 4.15 3.99 4.07 4.07 4.39 3.97 4.12 4.18 4.08 4.09 4.28 3.98 4.12 3.85 4.14 4.14 4.1 3.87 4.26 3.67 4.09 4.05 4.32 3.72 4.11 3.61 3.97 4.03 4.21 3.67 4.14 3.56 3.96 4.11 4.21 3.25 3.61 3.46 3.47 3.52 3.8 3.9 3 3.28 3.43 3.4 3.45 3.54 3.86 2.96 3.08 3.21 2.98 3.18 3.63 3.9 3 2.94 3.5 2.77 2.87 2.98 3.14 3.09 3.58 2.62 2.53 2.65 2.8 2.54 2.68 2.97 2.97 3.14 3.14 2.85 2.68 3.3 3.12 3.16 4.1 3 4.1 2 4.0 5 Germ any 26 Japan United 29 States China 38 Malaysia 46 Thailand Indonesia India 3.61 Sri Philippines 52 59 53 8 1 2.7 3.4 59 2.5 8 Cambodia 10 1 2.56 3.1 8 2.37 2.3 2.2 2.2 4 2.1 Lanka Vietnam Myanmar Source: World Bank 9 12 9 Tracking & Timeli tracing ness 4.0 3 2 3.0 8 3.0 2. 5 Global Entrepreneurship 3 2.61 2.47 2. 8 2.77 2.4 2 3.64 2.6 5 2.5 3.3 2. 9 2.34 2.9 5 2.5 9 1
  • Fiv ke eleme o eComm e y nts f erce Demand Technology Connectivity Payment Logistics Global Entrepreneurship 2
  • Payment Ve lo cre card ry w dit penetration Number of active credit cards … Source: AKKI Global Entrepreneurship 2
  • Payment … However, availa Innovative online ble Banks   Prepaid mobile  payment Payment- gateways: payment solutions Indom Veritr Dok Finp et og, ans, u, ay, c Global Entrepreneurship 2
  • Fiv ke eleme o eComm e y nts f erce Demand Technology Connectivity Payment Global Entrepreneurship 2
  • Technology Each evolution stage lowers individ t ha gre eComm sit the barrier for uals o ve at erce e Initial Capital Invest Complexity to ment Us Resource er Require Development ment Cont rol Adaptability High Medium low Low High Medium Low High Low Low High Low Low - medium Low Medium High Global Entrepreneurship 2
  • Conclus ions Indonesia’s demographic conditions present great opportunity for eCommerce. Rapid growth is imminent as Appropriate and balanced governance, ar als infrastructure development requi & regulations growforwa t ensu sustain rules e progresses: communication, logistics, ando red o resolutions. th rd. able payment Global Entrepreneurship 2
  • Conte nts 1 Indonesian eCommerce Landscape 2 Compet Environ &Strate itive ment gies Global Entrepreneurship 2
  • eComm Typ erce es C2C / Marketplace B2C B2B Daily Deals Global Entrepreneurship 2
  • Typ &implications scenar es (typical ios) C2C B2C B2B Basic success Indicators Traffic, transaction & sales volume Sales & profit margin Member size, revenue Capital Requirement Low High Low Monetization Cut from transaction amount, ads, premium services Sales margin, ads, volume discounts, other seller incentives Global Entrepreneurship Premium business subscription services, ads 2
  • On hand play a stab sta ly ful ers t le te Source: chinasocialgames.co Global Entrepreneurship 2
  • I B2 sca matt n C, le ers! Source: Investopedia.co Global Entrepreneurship 3
  • In C2C, the network rol  effect plays a ago o servi ha o th val big e the effect that produser of peo t oth one uct o er ple od r ce o th s n e ue f at Better be early than late! Global Entrepreneurship 3
  • Trust still the key barrier i to eCommerce n Some of the tactics to build Indonesia  Cash-on-delivery trust to consumers   Buyer & seller ratings  (C2C) Publicity on credible Strate partner wit credi media gic ship h ble bran ds Global Entrepreneurship 3
  • Typi Busin Flo o B2 eComm cal ess w f C erce Sourc ing Customer Service Cont ent Marke ting Fulfillm ent IT, Finance, HR, BI Global Entrepreneurship 3
  • Sourc ing Sourc meth &implicat (typic ing ods ions al) Purchase on Margins Ord er Consignment Outright Purchas e Dropship Cash Flow Operational reliability Global Entrepreneurship 3
  • Sourc ing Gro marg (typic ss ins al) Range Average Mobile Phone 3-5% 4% Computers 3-12% 8% 10-30% 20% 5-40% 25% Books 15-30% 25% Home Decor 25-100% 35% Fashion 20-70% 40% Home (electrical) applian Toys,ces baby kids, Note: data obtained from qualitative surveys on online & offline retailers; Actual negotia Global Entrepreneurship margins depend much on volume, cooperation & 3
  • Sourcing The importance of Terms of Payment Cas conver cycle da h sion 10 ys Global Entrepreneurship (Walma rt’s): 3
  • Sourcing The importance of Terms of Payment (Amazon’s): financ Amaz busin suppli ar ers e ing on’s ess! Global Entrepreneurship th e 3
  • Content Strategic placement for premium Popular / high margins / loss leaders (highly discounted) Source: lazada.co.id landi pa ng ge Global Entrepreneurship 3
  • Content Pictures, nonprodu descriptions, standardize cts reviews d Source: zalora.co.id –cruci es fo al, p. r Global Entrepreneurship 3
  • Marketing Focus on digital marketing! Digital marketing provides highest return for eCommerce  Search Engine Optimization  Search Engine Marketing (AdWords, GDN, FB,  etc) Guerilla campaigns (Twitter, other freebies,  etc) BB Broadcasts  The only exception: credibi an onli yo ha obtai tracti &th bud lity, d y f u ve TV (to build ned on e get Global Entrepreneurship 4
  • Fulfillm ent Invest in system, carefully choose logistics partners  Overall: Investments in systems (technology, procedures, rules) are essential. Considera Ideally the fulfillment system is fully  In-bound: Only a very small fraction of integrated with others: tions: order management, integrated  suppliers have open customer service, finance  to ensure reliability. inventory system Warehousing: Clear floor planning, SOP, system are mandatory vari (timeliness, tracing & tracking, Out-bound: Partner selection is crucial (if outsourced). Quality responsiveness) and commitment es widely among the players. Global Entrepreneurship 4
  • Topic List for  Interactive Discussions Social Media: chann           prioritize & use top els Newsletter Blogs & community Loss leaders & long-tail items Bundles & seasonal packages Merchant-sponsored promotions Relaxed policy Installments return rate Free shipping COD Private labels Global Entrepreneurship 4
  • Fung Fuk Lestario Executive Director, GEPI fung.lestario@gepindon 4