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Jakarta Post

Brands bank on apps to net more shoppers

Looking to tap into the country’s skyrocketing number of mobile device users, e-commerce players are increasingly focusing on mobile applications to boost customer numbers and loyalty

Khoirul Amin (The Jakarta Post)
Jakarta
Mon, June 29, 2015

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Brands bank on apps to net more shoppers

Looking to tap into the country'€™s skyrocketing number of mobile device users, e-commerce players are increasingly focusing on mobile applications to boost customer numbers and loyalty.

Zalora, Lazada and Elevenia are among e-commerce businesses putting their trust in mobile apps to exploit Southeast Asia'€™s largest e-commerce market.

Zalora Indonesia'€™s head of marketing, Jo Bjordal, said that in light of the large proportion of Indonesians who accessed the Internet through smartphones, his firm would encourage existing and potential customers to use the brand'€™s mobile app.

'€œHopefully, by the end of this year, we'€™ll reach 70 to 80 percent of all transactions coming from the app. It'€™s already around 50 to 60 percent,'€ he said recently.

Although the firm has no specific figures for app downloads in Indonesia, the fashion retailer recorded around five million downloads across Asia as of March this year.

Indonesia, which is home to 250 million people, is considered a very promising market for mobile e-commerce, with Internet and smartphone penetration forecast to hit 55 percent and 41 percent, respectively, in the next two years, according to UBS and eMarketer.

The importance of Zalora'€™s mobile app, Bjordal said, hinged on its potential to build a prominent brand presence through customers'€™ smart devices '€” whether Android- or iOS-based.

'€œOn top of that, ['€¦] we can send push messages, making sure that [customers] get exactly the offers they want to see,'€ he went on.



Voicing a similar view, Lazada Indonesia chief marketing officer Sebastian Sieber said that with Indonesian smartphone users spending an average three hours a day on their devices, mobile apps had become indispensable for e-commerce players.

'€œWe'€™re trying to be where our customers are, and that'€™s in their mobile phones. So, what we'€™ll keep pursuing is app penetration,'€ he said, adding that around half of Lazada'€™s transactions came from mobile devices.

Zalora and Lazada, which are backed by German venture capital Rocket Internet GmbH, are both making mobile app development one of their largest investments this year.

Zalora'€™s Bjordal said that most of his firm'€™s investment this year would be in online marketing, including through the mobile app.

Meanwhile, Lazada Group, which has raised US$250 million for development, will spend most of its investment in Indonesia to build a better logistics system and develop its mobile app.

Sieber said that the firm would open a new warehouse in Surabaya, East Java, and would aim to double its number of delivery hubs by the end of the year to 40 from the current 19.

Online marketplace Elevenia, which has allocated around $24.2 million for development this year, will spend heavily to boost traffic on its mobile app by offering special discounts on transactions made through it.

Elevenia, which booked Rp 80 billion ($5.9 million) in transaction volume by May this year, recorded around 6,000 app downloads in the same period.

'€œApp development and app promotion are among our main focuses, particularly during this Idul Fitri holiday, when many people are away from desktop computers as they return to their home towns,'€ said senior company manager Anggita Vela Lydia.

She added that with the help of a range of promotions, including for app users, Elevenia expected to double its daily transactions, which currently stand at between 8,000 and 10,000.

Meanwhile, recently launched online clothing line 8Wood and travel retailer PegiPegi are looking to join the mobile app bandwagon this year, completing their online platforms with apps for Android and iOS users.

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