Interview with Igor Pezzilli, CEO of Lazada Malaysia
|Igor Pezzilli, CEO of Lazada Malaysia|
Congratulations on Lazada's new round of funding, what kind of synergies do you expect from Tesco being one of the latest investors?
We are thrilled to welcome Tesco among our investors. The investment is another indication that Lazada is a leading e-commerce player in Southeast Asia. End users and consumers will see the result of this investment in the development and expansion of Lazada.
Lazada has been aggressively pushing for its marketplace model, is it more like Amazon Marketplace or Rakuten?
We have our own approach to Marketplace: our objective is to provide a simple and convenient way for merchants to sell online. We support our merchants with our marketing and promotions activities to boost their online revenue, plus fulfillment service with our own warehouse and fleet.
Related article: Lazada Marketplace, is it more like Amazon or Rakuten?
In short, Lazada as an online platform provides turnkey solutions for merchants to go online, and making e-commerce easy for them. Together with our merchants, we strive to deliver tremendous shopping experience to our customers.
|Lazada's new office in Kuala Lumpur|
Since Lazada is a hybrid marketplace model like Amazon which is 1P (own inventory) + 3P (third-party merchants), will it be a threat for merchants to sell on your platform?
Quite the contrary, we do not have a practice of hunting suppliers of our merchants. Our goal is to partner with our merchants to complement our existing offering. Ultimately, we just want our merchants to sell more by providing the best offers to our customers.
Related article: Is Amazon losing market share to Lazada in Southeast Asia?
At the moment, Lazada seems to provide only an order fulfillment platform for merchants, rather than an end-to-end merchant system like Rakuten or some other marketplace players. Will it be a challenge for merchant to say, manage their products?
|Lazada's order fulfillment platform for merchants|
We are working on better solutions for our merchants which will be released very soon. right now, our priority is to get our merchants focus on the selling part - learning what is selling well, what is not selling well.
Although the process is important, the sales result is even more important! We support our merchants to become an assortment expert, by understanding what products can sell online. You can imagine the scenario of a small merchant getting 50% of its revenue via Lazada - if the results are good, merchants will probably invest more and eventually be more committed in e-commerce.
Related article: 25 ways to increase online sales
Together with Zalora, Lazada seems to be one of the few players in the country offering nationwide(?) COD. How is Lazada's fulfillment strength at the moment, and are you also looking at the model of Fulfillment by Amazon?
Well, we have our own fleet which covers Klang Valley. ecommerce.milo: How big is the fleet team? The fleet is growing fast we have over several dozen of them at the moment. By having our own fleet which focuses only on our own customers, we can provide better fulfillment experience.
Related article: Is Cash on Delivery (COD) popular in Malaysia?
Of course, we are working with the usual 3PLs here like TA-Q-BIN and GDex to cover COD for the whole country. I have to say that they are great partners and they are doing a great job so far.
As for FBA, we do have our own FBL! Fulfillment by Lazada is a solution for our merchant who wouldn't want the hassle of fulfillment process, by using our picking, packing and delivery services.
How does Lazada charge its FBL service?
It is all variables depending on the arrangements. Storage is not a big factor but the fees that we charge for FBL is mainly on the picking, packing and delivery services.
Related article: Understanding e-commerce fulfillment
With the launch of Lazada fashion marketplace recently, will it be head-to-head with your sister company Zalora?
Not at all, if you look at our offerings now, Lazada has different positioning if compared to Zalora, in terms of assortment offerings. Our customer base is different too.
It is also a matter of personal preference and options. Imagine if you walk into a physical shopping mall, you might enter certain shops of your choice but some other shops you will never visit.
Related article: Marketplace battle, why product offerings matter?
From your experience so far in Malaysia, have you observed anything special about online shopping behavior here if compared to other countries in the region?
Well, Malaysians buy and spend a lot!
My observations so far show that Malaysians are very detail-oriented consumers. They will check every single detail before making an online purchase, especially if they are buying from you for the first time.
However, if you win them over, you win their loyalty, and they will come back for more!
Lastly, no doubt it is challenging to venture into e-commerce here but what are your advices or tips to anyone who wish to start an e-commerce venture in Malaysia?
|Lazada's previous workspace in Kuala Lumpur|
It's easy, open a store in Lazada!
I would personally think that niche e-commerce website stands a good chance, be it handcrafts, imported or exclusive products. Mass market strategy will be better suited for bigger players with deeper pockets.
Also, don't try to be too fancy or sophisticated, just focus on what's the most important aspect step by step. Ultimately, you definitely need to be customer oriented and build happy customers.
What say you?