eCommerce Boom in China and Asia
Mar 17, 2013
OTC Disclosure News Service
Seoul, Korea, Republic Of
China’s e-commerce industry will grow quickly in the next five years
and its transactions are expected to quadruple last year’s figure by
2015. The sales volume of China’s e-commerce will annually grow at least
32 percent year-on-year from 2011 to 2015. We estimate a transaction
volume of 18 trillion yuan ($2.8 trillion) in 2015. The amount in 2010
was 4.5 trillion yuan.
Asia’s online population surpassed 825 million users in 2010 and new
research from shows another 700 million more will be added by 2015.
AFTA and CAFTA have changed the way Asians will conduct online
business. ASEAN Free Trade Area (AFTA) is a trade bloc agreement by the
Association of Southeast Asian Nations supporting local manufacturing in
all ASEAN countries.
The AFTA agreement was signed on 28 January 1992 in Singapore. When
the AFTA agreement was originally signed, ASEAN had six members, namely,
Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand.
Vietnam joined in 1995, Laos and Myanmar in 1997 and Cambodia in 1999.
AFTA now comprises ten countries of ASEAN. All the four latecomers were
required to sign the AFTA agreement in order to join ASEAN, but were
given longer time frames in which to meet AFTA’s tariff reduction
obligations. CAFTA is the same trading bloc that now includes China.
Nowhere in the world is online shopping exploding as quickly as in
Asia Pacific. This region now includes more than 40% of the global
online population, and with the growing percentage of online shoppers
and increasing per-capita online spending, the aggregate online retail
markets of Asia Pacific are growing faster than their counterparts in
North America or Europe.
Turnover of Tmall.com and Taobao.com, two major Chinese online
shopping platforms, surpassed 1 trillion yuan ($160.5 billion) as of Nov
30, according to e-commerce platform provider Alibaba Group on Monday.
Turnover of Tmall and Taobao during the first 11 months months this
year equals to 5.4 percent of China’s total retail sales in 2011, which
stood at 18.4 trillion yuan, according to Alibaba.
Company statistics show that people between the ages of 25 to 35, who
are major customers of Tmall and Taobao, contributed to 59 percent of
The most favored two categories of products by consumers were
clothing, and 3C digital products (computers, communication and consumer
electronics), accounting for 30.3 percent and 18.6 percent of the total
Transaction volume on Taobao.com, which was founded in May 2003, reached 20 million yuan in that same year.
Alibaba split Taobao into three separate companies in 2011. They are
Taobao, a C2C online shopping destination, Tmall, a B2C online
marketplace for brand-name goods and eTao, a shopping search engine.
Transaction volume on Taobao and Tmall totaled about 630 billion yuan in 2011.
LAZADA is Southeast Asia’s fastest growing online department store,
with operations in Indonesia, Malaysia, Philippines, Thailand and
Vietnam. LAZADA is pioneering eCommerce across some of the fastest
growing countries in the world by offering a fast, secure and convenient
online shopping experience with a broad product offering in categories
ranging from consumer electronics to household goods, toys and sports
equipment. LAZADA is always striving to offer its customers the best
possible offering – including multiple payment options, free returns and
extensive customer service and warranty commitments.
Swedish investment house Kinnevik is betting big on Southeast Asia’s
economic rise through an investment of $40 million in online shopping
site Lazada, which is emerging as a leading player in the region’s
The new investment comes shortly after Lazada announced that it now had the backing of JP Morgan Asset Management in Hong Kong.
“This provides Lazada with an exceptionally well-funded balance sheet
to continue its fast growth in Southeast Asia,” said Lazada, an
e-commerce site owned by German incubator Rocket Internet.
The fresh funds would help the company further expand its
already-growing reach and product line-up for its customers in
Indonesia, Malaysia, Philippines, Thailand and Vietnam.
“By focusing on providing superior service to our customers we have
grown into a trusted household brand and to broaden our assortment is a
natural next step for us,” Lazada’s regional CEO Maximilian Bittner
Lazada recently added fashion to its extensive product offering,
which ranges from consumer electronics to household goods, toys and
“Kinnevik has a proven track-record of investing in emerging markets
and we are very excited to have such a knowledgeable and experienced
investor on board,” Bittner said.
“In addition to capital, they will provide us with invaluable
strategic insight of operating in such markets. It is also a strong
testament to what we have accomplished so far and verifies that we are
on the right track to achieve our aggressive strategic goals,” he added.
Lazada is largely believed to be patterned after the popular United
States online shopping site Amazon.com, which failed to establish a
significant foothold in fast-growing emerging markets like the
In a statement, Kinnevik investments head Henrik Persson said
Lazada’s rise to become a recognized name in e-commerce in a relatively
short period led to the investment.
“We are delighted to invest in Lazada, which has obtained a market
leading position,” Persson said. “The company is perfectly positioned to
become the major e-commerce player in this region, which counts more
than 600 million inhabitants,” he said.
Xirxi Co Ltd is a Retail and Wholesale company for three primary
customer bases: consumers, sellers and enterprises. In addition, the
Company generates revenue through other marketing and promotional
services, such as online advertising, IT Services.
The Company operates in two segments: South East Asia and
International. The Company serves consumers through its retail Websites,
and focus on selection, price, and convenience, the logistics of online
retail and International wholesale in South East Asia offer challenges
that large companies like Amazon etc cannot manage.
Xirxi designs its Websites to enable products to be sold by it and by
third parties across dozens of product categories. Xirxi also
manufactures and sells unique products that will develop an International Market.
It fulfills customer orders in a range of innovative ways, including
international fulfillment centers and warehouses that it operates in
Laem Chabang, Thailand’s Tax Free Zone, through co-sourced and
outsourced arrangements in certain countries, and through digital
delivery. It operates customer service centers in South East Asia, which
are supplemented by co-sourced arrangements.
The Company offers programs that enable sellers to sell their
products on its Websites and their own branded Websites and to fulfill
orders through it. It earns fixed fees, revenue share fees, per-unit
activity fees, or some combination thereof from these transactions. The
Company serves developers and enterprises of all sizes through Xirxi IT
Services (XITS), which provides access to technology infrastructure that
enables any type of business.
The above news release has been provided by the above company via the OTC Disclosure and News Service. Issuers of news releases and not OTC Markets Group Inc. are solely responsible for the accuracy of such news releases.