Lazada’s E-wallet coup
It’s one of the best moves they ever made
Lazada, the south-east Asian marketplace, are growing. Their “12.12 Grand Year End Sale” helped them finish 2019 on a high. A recent report on the event highlighted that there were over 6million sales in the first 24 hours.
Although Alibaba buying the company has helped them already, like Lazada being included in Alibaba’s IP platform, there is actually something else that is helping the E-Commerce platform to grow at an incredible rate. The “Lazada wallet” is an E-wallet that allows users to add funds to their E-wallet either online, or in real life.
The ability to “top up” a Lazada wallet offline has brought Lazada to people who do not have regular access to the internet. To top up offline, users can go to a participating physical store and use the cash to add money to their virtual wallet.
What is an E-wallet?
An E-wallet is an online payment method. It is called a “wallet” as you are able to hold funds in it, just like a physical wallet. Sometimes they are also called “digital wallets”. E-wallets have been popular over the years in the online betting market, but more recently E-Commerce platforms have started using them to ensure that people can pay for their goods quickly and easily. Conveniently, people can also put things like store cards and drivers licenses in their E-wallet.
(The “Lazada Wallet” stays close in design to the main site; Source: Lazada Wallet)
Why are they so popular in SEA?
Although smartphone usage is high in the South East Asia regions, there are surprisingly low numbers of people with a bank account, especially one that has a linked debit card. In countries like the Philippines, many people live day to day using cash. But an E-wallet gives the user the opportunity to walk into a bank or a participating store, top their wallet up, and buy online.
(Users can top up, check their balance and perform many other tasks online; Source: Lazada Wallet)
What has the Lazada E-wallet done for Lazada’s growth?
A recently written article stated that Lazada has 50million active users and had grown 100% year on year since its first quarter. In the grand scheme of things, it is their ability to move with the times that has given them the edge over competitors like Shopee.
Although Shopee have their own E-wallet, the options to add funds to it are quite limited and do not have offline options like Lazada. Around 90% of users in the SEA region do not have credit cards, which means Lazada’s cash on delivery option is really popular. The E-wallet launch in early April 2018 has helped them penetrate the market in a big way.
Platforms like Lazada and Shopee are always thinking of innovative ways to grow their market share. While this quick growth is great for consumers and brands with products being sold on the platforms, this also carries a risk. Platforms going quickly can sometimes overlook brand protection, leaving it down to you to protect yourself.