Following months of speculation, it appears that Amazon is finally making its APAC entrance by way of Singapore.
“Amazon entering the market will change the speed at which brands operate,” said Josh Gallagher, the chief strategy officer at Havas Group APAC. “Its consumer promise has always been reflective of this, with speed of search, the speed of personalisation, the speed of delivery and now the speed of recommendation through Spark.”
Ken Mandel, president of innovation and commerce at Publicis Media APAC, believes that the battle between Amazon and Alibaba is “going to be a bloodbath, with both Amazon and Lazada accelerating the addictive consumer habits of mobile ecommerce shopping.”
He predicts that mobile will be the main battleground, speculating, “Amazon will launch PrimeNow, which will only be available as a mobile app, here in Singapore. This will force Singaporean shoppers to download the app and to adapt, giving Amazon a direct communication pipe into shoppers’ wallets.”
Hugh Batley, the managing partner of Lion & Lion, agreed the battle will be great, and said Lazada can't be counted out. The Alibaba-backed ecommerce company has “way more experience with SEA challenges such as payment” and can hold its own against the likes of Amazon.
In response to Amazon’s entry, brands in the APAC region would do well to conduct audits that determine their readiness for listing and e-operations, according to Batley.
“L2 reported earlier in the year that, for most competitive categories, Amazon rewards go to a small few with the ‘top 10’ brands in a category regularly obtaining more than 85 percent of the best seller share of voice,“ Batley said.
Brands that find success with ecommerce have made significant investments in key capabilities such as product data (visuals and descriptions), product reviews, commercials, supply chain, and collaboration agility.
“We believe brands need to be investing in these areas to capitalise on the benefits [that] both Lazada and Amazon can bring to their bottom lines,” added Batley.
Rohan Lightfoot, APAC managing director at Isobar, says Amazon's will "have a fight on its hands" but its ability to discount will be a huge feather in its cap.
"Uber, Grab and the taxi apps are discounting and adding value to attract and retain users," he told Campaign Asia-Pacific. "They have trained their customers to be promiscuous and to jump from platform to platform in pursuit of value. Amazon are surely going to have to do the same to pry Singaporean shoppers away from Taobao and Lazada."
But, he said the real battle will be in the market for subscription content services, which the likes of SingTel and StarHub will be closely monitoring.
"One fruitful area of opportunity for brands is likely to be in partnerships where they can be part of value bundles that Amazon (or the established players) will want to offer to tempt trials and seduce sign ups," Lightfoot added. "Amazon will be likely to promote these offers aggressively, giving brand partners good visibility from a consumer point of view."