LAZADA
Lazada is a privately owned company that operates in the Asia pacific region with headquarters based in Singapore. It is a premier online marketplace and a pioneer of ecommerce. The company was founded in 2011 by Rocket Internet, a multinational German internet company. Lazada has grown to become the leading online shopping site and selling destination in the region since its launch in 2012. The company’s vision is quite practical and emphasizes on performance. Its goal is to capture the largest possible share of consumers online. Its business model involves selling of inventory to customers from its own warehouses. It also has an additional marketplace model which allows third-party retailers to sell their products through the company’s website. This adds to its revenue through the commissions deducted from the third party sales on the site.
ZALORA
Zalora was also established in 2012 by Rocket Internet. The company headquarters is based in Singapore and has several branches across Southeast Asia. Today, it is a leading online fashion portal that serves the Asia pacific region. The company has emulated Lazada in accepting the set-up of third-party merchant shops on its sites, and takes commission on the sales. It offers collections of top international and local brands and products ranging from beauty products, shoes and accessories for both men and women. The company has embraced technological and innovative techniques through which enable them to deliver the best online services.
COMPARISON
CONSUMERS
Lazada has over 5.7 million customers. It provides them with limitless shopping experiences through their website. It also allows third party online retailers a simple and direct access to their large customer base. The customer service hotline is usually open on a regular basis during the business hours from Monday to Friday. The customer service is in-house and works directly for the company to provide high levels of service. Zalora has also acquired large customer base since its launch at reasonable customer acquisition costs and thus increased its market. Its membership to the Global Fashion Group has helped increase its marketing strategy and customer base. The company, through the GFG network, has been able to meet the fashion requirements of over 2.5 billion customers. They also offer quality customer care services through customer service consultants. Both Lazada and Zalora collect their consumer’s personal Information, access and update them and ensure their security. They maintain technology product protocols that prevent unauthorized access to customer personal information. They also destroy information which are no longer required for their record retention purposes. Both companies also offer vouchers to their newly registered customers, with Zalora giving more amounts of money on their vouchers compared to Lazada.
REVENUE
In 2015, Lazada reported sales worth $1 Billion. The company’s net revenue was US $154.3 million in
- This was more than twice the revenue it reported in 2013 which was worth $75.5 million. Its operating loss was $152.5 million. This figure was also more than twice the 2013 operating loss worth $67 million. Zalora on the other hand reported $234 million in revenue in 2015. The Company’s net revenue in 2014 was $140.4 million. This indicated a 70% increase from 2013 returns. Lazada and Zalora’s combined net operating losses in 2014 therefore was a total of $235.3 million
INVESTORS
Lazada has various investors including Rocket Internet, Summit Partners, Temasek Holdings, Tengelmann Ventures, Alibaba, Access Industries, HV Holtzbrinck Ventures, Investment AB Kinnevik, Tesco, and Verlinvest. Zalora also has investors such as Rocket Internet, Access Industries, Investment AB Kinnevik, JP Morgan Securities, Len Blavatnik, Scopia Capital, Summit Partners, and Tengelmann Ventures
PRODUCTS
Lazada offers a wide array of products such as clothing, gadgets, jewelry, furniture, toys, media and books, luggage and accessories. Its online shop is equipped with some of the world’s biggest name brands including ASUS, Apple, Casio, Ray Ban, Olay, Cherry Mobile, Calvin Klein, Lenovo, Armani Exchange and Zara. Its products and services include Fashion, Health & Beauty, Mobiles & Tablets, Watches / Jewelry, Computers & Laptop, Home & Living, Home Appliances and Consumer Electronics. Zalora only offers fashion and beauty accessories for men, women and children featuring in-house labels. Their products include T-shirts, Pants, Shoes, Bags, Accessories, Sports Accessories, Grooming and Jackets. They also feature various international name brands such as Dove, Guess, Onitsuka Tiger, Jansport, Skechers, Vans, World Balance, Reebok, Levi’s, and Penshoppe.
SHIPPING/DELIVERY OPTIONS
Lazada uses LBC and 2Go (PH) to deliver orders to customers. LBC is an established company in local and international courier service provision and easily delivers orders on time as desired by the customers and as required by company. Customers can easily track their orders online or communicate to Lazada through automated text and email updates which the company usually provides. They can also call the company from Monday to Friday between 8am and 9pm. Zalora ships orders to their customers by GDex Courier as well as Ta-q-bin for cash on delivery orders. Zalora sends texts and email updates automatically to customers regarding the status of their orders and deliveries. Customers can call the company every day from 9am to 6pm. Zalora also stays in touch with its workers to ensure smooth shipping operations through live chats every day from 9am to 7pm.
RETURN OPTIONS
Lazada customers who opt for reimbursement or refund for purchased products are permitted to return the products provided their conditions are in line with the company’s policies which are clearly communicated on its website. It also offers a 100% unique buyer protection program in which customers can return the products between 7 to 14 days after delivery. This is effective within 24 hours after the delivery has been done. Zalora also has a well-structured refunds and returns policy system
which allows free and easy return of products within 30 days after purchase. The company only requires customers to fill out a return slip and avail the item for picking up via the company’s courier in the region. Customers also have the option to drop off the items for exchange at the courier’s or easily request for a change in the item’s color or size through the company’s website. Refunds are done via Bank transfers, credit cards, PayPal, etc.
PAYMENT OPTIONS
Lazada’s payment options currently include cash on delivery, credit card, debit card, PayPal, Bank Transfer, LBC Outlets, 7/11 Convenient Stores and helloPay while Zalora’s Payment options currently include credit card, cash on delivery, bank transfer, Me Pay, invoice, direct debit, prepayment and PayPal.
COUNTRIES OF OPERATION
Lazada operates in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam, and has a team in Hong Kong that handles cross-border marketing activities. The company also operates technology hubs located in Ho Chi Minh City and Moscow. Zalora operates in Singapore, Indonesia, Malaysia & Brunei, the Philippines, Thailand, Vietnam, Taiwan and Hong Kong. It also operates in Australia and New Zealand, where it is known as THE ICONIC.
FEATURES
Lazada specializes in internet, retail, ecommerce, warehousing & distribution, online payments, fashion, consumer electronics, mCommerce, and online retail. It belongs to the internet industry which is a privately held type. The company has 5001-10,000 employees. They have both web version and mobile version of their site which makes it easy for their customers to access the services from anywhere. Their official Website is http://www.lazada.com
Zalora specializes in E-Commerce, Fashion and Online Retail. It also has a mobile app to provide more convenience to its customers. It belongs to the Internet Industry which is a privately held type, and has 1001-5000 employees. The official website: http://www.zalora.com
CONCLUSION
Just like Zalora, Lazada is also an online retailer. However, the main difference between the two companies is that Zalora focuses on retailing fashion products, services and accessories while Lazada is an online shopping mall that offers much more products and services. Lazada is depicted as the most popular website due to the higher number of total visits on its website compared to Zalora. This clearly shows that Lazada is winning in terms of online popularity. Zalora’s online marketing strategies as well as offerings were tested when the two companies endured losses totaling to about $235.3 million. Those who had invested in Rocket Internet Group were advantaged since the losses were shrinking and becoming proportionate to the revenues. This was possible since Rocket internet has various stakes in over 141 internet companies worldwide. Lazada’s losses and their revenues thus doubled. Both Lazada and Zalora realized huge gains in sales and online business transaction in 2014. In the light of the
customer base as well as the total revenues reported by the two companies, Lazada emerges on top. Zalora has also put much effort in major realignment of its marketing strategies and are in the race to reach the success levels of Lazada. Besides Lazada and Zalora, other rival companies are also popular in the Asia pacific region and offer stiff competition in the online market.