More and more players are entering the social commerce arena, especially in markets such as Southeast Asia, Latin America and India, where the scale of social commerce is gradually increasing and where companies are beginning to explore viable business models in an attempt to gain broader growth opportunities. So how is social commerce in Southeast Asia and other places, driven by various factors, developing?
In Bangalore, Anu runs an offline jewelry store that bears her name. Around the world, there are more stores like Anu's than can be counted. And many of them have lost their stores due to misjudgment of inventory.
Anu, on the other hand, found another way. She found that by relying on WhatsApp, she was able to contact suppliers at any time, receive photos of new products, and sell them through WhatsApp. It's a quick way to make traditional retail business easy and fast 樂天集運 there are few sellers like Anu trying to sell from zero inventory in countries around the world, and it's flourishing all over the world, not just in India.
Today, Anu in the Philippines can try to open a store based on Resellee, while Anu living in Latin America can choose Elenas to build their own stores, and then find a steady stream of orders through social networks such as Facebook and Whatsapp.
In Southeast Asia, Latin America, India and other markets, this social e-commerce business model is becoming one of the key online shopping methods for locals. In tier 2 and 3 cities, a large number of customers' shopping requirements are not met by e-commerce platforms, and people spend a lot of time on Facebook, TikTok, Whatsapp and their popular local social platforms, where they not only swipe videos and play games based on these platforms, but now also rely on them to shop and share tree planting products and services with friends and family.
ChiboTang, managing partner of GobiPartnersGBA, has revealed that social e-commerce sales reached $474 billion in 2021. Another data organization Statista estimates that the social e-commerce market will grow to $2.9 trillion by 2026, up from $958 billion in 2022. And by 2028, the figure will increase to $3.37 trillion.
Therefore, the market dividend, a steady stream of entrepreneurs and assets are pouring into the social e-commerce runway, a social e-commerce battle for supremacy opened up.
I. Meesho copy Meesho
In the global social e-commerce platform, Meesho from India is as famous as Jindo.
Founded in 2015, Meesho means "my store" in the local language. Initially, Meesho relied on sellers like Anu, who bought products from resellers and sold them through WhatsApp and Facebook group chats. This model quickly helped Meesho build a large marketing network, i樂天JAPAN millions of Indian social merchants with a large number of dispersed goods and service providers, and providing tools for logistics, payments, and more.
The Chinese market is no stranger to Meesho's business model, and Meesho's China insiders have told the media that Meesho is more like a domestic pool in the Indian market.
Only, no one had predicted that Meesho could reach the scale it has today by relying on these merchants alone. During the new crown epidemic period, Meesho quickly had 120 million monthly active users (MAU) in a short period of time. In contrast, Flipkart and Amazon, India's popular e-commerce platforms, have about 200 million registered users. By today, orders from Meesho account for about 2.7 million of the 9 million daily e-commerce orders processed in India, while the two giants account for 5 million.
In March 2022, it was announced that Meesho was planning to go public in early 2023. Recently, its Chief Experience Officer MeghaAgarwal also highlighted that Meesho plans to be profitable within 1 to 2 years.
However, instead of limiting its sights to within India, Meesho has set its sights on the world early on, opening up the journey to copy Meesho.
In 2020, Meesho's overseas social e-commerce investment layout was the first to come to Latin America, participating in the seed round of financing for Elenas, a Latin American social e-commerce platform.
Similar to Meesho, Elenas works with both local factories and buyers, and has built a marketing network of over 20,000 people. Users use Elenas to select the products they want to sell, and then Facebook and Whatsapp the details of the product descriptions, photos, etc. Once an order is placed, the supplier is able to deliver the package to the customer through a partner logistics company. in March 2021, the platform received another $6 million in Series A funding and expanded further from Colombia to Mexico.
The penetration of e-commerce in Latin America is extremely low, but due to the sharing nature of Latin Americans, sales are still based on a very traditional direct sales approach - people order products from magazines shared by their friends. As a result, there is a lot of potential for social commerce, with data showing that in 2021, social commerce user penetration in Brazil and Mexico, the two largest economies in Latin America, will be 38.7% and 30.9%, respectively.
In September 2021, Meesho landed in neighboring Southeast Asia, and in September 2021, Kitabeli, an Indonesian social commerce platform, revealed that it had raised another asset in the context of a $10 million Series A round six months earlier, with investors including Meesho founders Vidit Aatrey and Sanjeev Barnwal. A year later, Kitabeli closed another $20 million round of funding.
Kitabeli co-founder and CEOPrateekChaturved shows that the e-commerce markets in India and Indonesia have a lot in common, for example, e-commerce in tier 2 cities is not developed enough compared to tier 1 cities, "We found that users in these smaller towns are generally shopping online for the first time, possessing a non-face-to-face buying and selling insecurity, and need help and guidance in using various roles."
As a result, KitaBeli has incorporated social features into its app, such as Mitras agents, 樂天集運 and group buys.KitaBeli's key sales currently come from FMCG products, including rice, oil, sugar, milk and personal care products. Customers are able to share shopping connections with friends and receive certain rewards after placing an order. chaturvedi indicates that, based on DTC's operating model, the business hopes to develop user habits. It is understood that the average value of orders on the platform is currently between $5 and $10, generally for group purchases of 5 to 25 people.