Introduction to E-commerce Platform Model

Indonesia PhilippinesMalaysia ThailandSingapore Vietnam

Bangkok, June 2018

1. E-commerce in SEA

2. We are Lazada: company overview

3. Overview of Lazada Thailand

4. Join Lazada: business mode and services

AgendaDevelop your e-commerce with Lazada

E-commerce in SEA3 Macro trends highlight e-commerce opportunity

3

Booming macro

environment

Lower barriers to entry

through e-commerce for

brands

Highly engaged and fast

growing internet

population

▪ Strong GDP growth with

SEA GDP expected to

grow at 5.5% p.a. through

2020. In 2016, SEA PPP-

adjusted GDP per capita

($12K) close to that of

China ($15K)

▪ Growing disposable

income with over 145M

people expected to

achieve a disposable

income greater than 3K

USD by 2016

▪ Thriving young

population – 70% of

SEA’s population will be

< 40 by 2020, vs. 57% in

China

▪ Insufficient retail

infrastructure in SEA -

Gross Floor Area per

capita in Thailand and

Indonesia at 0.5 and 0.1

sqm respectively versus

2.6 sqm in the US

▪ Significantly lower

barriers to entry for

brands, leveraging on their

existing access to tier 3/4

cities which are lacking

offline retail alternatives

▪ SKU level’s customer

engagement and

purchase data to enable

data backed decision

making

▪ Internet savvy

population with ~260m

internet users, of which

~200m Facebook users,

mainly on mobile devices

▪ Rapid adoption of low-

cost mobile phones and

tablets is significantly

increasing smartphone

penetration and

accelerating the shift to

online

▪ Growing KOL e-

commerce and online

content help drive

customers purchase

decision

1 2 3

4

E-commerce in THSolid, active and growing base of internet users

▪ Internet penetration has reached

64% in 2016

▪ In 2017, more than 90% of Internet

users in Thailand use smartphones

▪ Average time spent on the

internet on mobile devices

exceeds 6.4 hours a day

▪ For 2016, the number of

smartphone users in Thailand is

estimated to reach 75% of the

population

▪ Thailand ranks number one for

engaging with online videos

▪ Line has 41 million users in Thailand,

making the country the second-largest user

base after Japan and representing 94% of

the nation's mobile internet users

18.9m Lazada Line Friends

▪ With 46m active users in Thailand , there

are more Facebook users in Bangkok than

any other city in the world

▪ 21m Lazada fans on Facebook TH

▪ Thailand has more than 100k users and

hosts one of the most Instagrammed

locations in the world

Source:Thai Tech; the Nation; Syndacast; Reuters; IDC Thailand ; Press Reader as of Oct 2017

Exceptional social media engagement

across key platforms

Fast-growing internet and

smart phone penetration

Our Vision

We are LazadaOur vision and our objective

We aim to enhance the lives of Southeast Asia’s

growing middle class by helping them realise their

dreams and aspirations.

How do we do it?We are democratising retail and serving recreational needs

by building the region’s most comprehensive and

convenient marketplace and lifestyle platform

What is Success?

We have more than 100 million active customers on the

platform out of the region’s expected ~125 million middle

class and above population

?

We are LazadaOur journey milestones from 2012

Cash on delivery

Lazada Express

Fulfillment by

Lazada

Alibaba-Lazada

Integration

2012 2013 20152014 2016

Cross-border

Trade

Lazada-Redmart

Integration

2017

Alibaba

83% ownership

2018

▪ The online destination site in SEA for customers, brands

- HQ in Singapore with local operations in 6 countries

- Launched 5 markets in March 2012: ID, MY, VN, PH, TH

- Launched Singapore in May 2014

▪ One-stop shop to access locally and internationally sourced

39M assortment across 18 categories

▪ Created an end-to-end ecosystem enabled by best-in-class

logistics and payments capabilities to address key

challenges in South East Asia

Majority

investor

LAZADA PRESENCE

China

Thailand

Pop: 68m

Malaysia

Pop: 30m

Indonesia

Pop: 254m

Philippines

Pop: 108m

Singapore

Pop: 6m

#1

#1 #1

#1

#1

Lazada B2C eCommerce

market position

Vietnam

Pop: 93m

HK / Shenzhen

Sourcing hub

COMPANY OVERVIEW

Source: IMF database

1 Based on Jan 2017 run-rate GMV

We are LazadaLazada Today

7

We are LazadaOur team at your service

22 Fashion experts

20 Onsite designers

Ready to make your brand big online

100 Customer support agents

700 E-commerce professionals

Top brands from across the globe to consumers in a trusted

environment

We are LazadaUnleashing e-commerce brands potential

Strictly Confidential 9

Brand Flagship StoresOfficial Stores Channel

Source: Company Information January 2018

We are LazadaOur Fashion Brand partners in Thailand

Top brands are already working

with us developing their business

with omnichannel

Online Festival Journey since 2012Together we are making online history in SEA

Online

Festival 2014

5,000,000.-

GMV

in 2 days

5,000

orders

in 2 days

Online

Festival 2015

3,000,000

visits

130,000 orders

in 2 days

20,000

visitors

in 2 days

Online

Festival 2016

3,000,000

visits first 12

hours

3 Items sold

/second

Online

Festival 2012

Online

Festival 2013

Online

Festival 2017

10,500,000

visits in 1day

Online Festival Journey since 2012Together we are making online history in SEA

Offline: Large awareness channels to

tease about 11.11 mega day

OOH Saturation

Online: coupled with irresistible onsite

mechanics and great support from partners

TVC

Main Campaign Page Lazada TV

Social Media

Join LazadaMarketplace business model

13

Marketplace Marketplace

Fulfilled By Lazada

Collaborative

Planning &

Forecasting

Campaign Planning

& Management

Campaign Coordination

Co-Marketing

Assortment Selection & Forecasting

Content Creation

SIS Development

Optimize Supply

Chain & Integrate

with Lazada’s

Operations

Warehousing

Inventory Ownership

OMS & Pick & Pack

Last Mile Delivery

Customer Service

Operating Models

Brand

(Lazada support)

Brand

Lazada

Brand & Lazada

Activities and Operating Models

Brand

Lazada

Brand

(Lazada support)

Brand & Lazada

Join LazadaBeing a brand on Lazada unlocks brand potential

Generate additional sales ▪ Add extra hi-margin turnover to offline sales

Penetrate untapped markets ▪ Reach consumers and geographic areas not

covered by offline retail

Acquire young customers ▪ Target millennial consumers

▪ Communicate using new media

Gain knowledge of market ▪ Targeted analytics

▪ Buyer profiles and geographic localization

▪ Banners engagement and marketing efficacy

Test new products ▪ Fast display and action

▪ Controlled stock commitment

▪ Focused consumer target

Test promotions and commercial

initiatives

▪ Test new commercial mechanics: bundles,

promotions etc.

Revamp image ▪ No-filter communication of brand values

▪ Deliver up-to-date brand initiatives

▪ Target untapped audiences

Increase brand awareness ▪ Increase brand exposure

▪ Full control of core values communication

Promote new products ▪ Test new collections

▪ Promote long tail/seasonal items

Market

Intelligence

Product &

Branding

Turnover

5. Online Store

Management▪ Banners, content

▪ Campaign

participation

▪ Pricing, bundles,

vouchers

▪ Consumer

engagement: chat,

messaging

4. Offer▪ Assortment

▪ Competitiveness

▪ Exclusive products

▪ Exclusive

promotions

▪ Stock coverage

▪ Novelty

2. Offline marketing▪ Retail in store

activation

▪ Videos

▪ Newspapers,

billboards etc.

▪ Brand ambassadors

4. Search▪ Brand official store

in search menu

▪ Merchandising in

category pages

▪ Product description

optimization (ex. Air

Max)

3. On site▪ Onsite/Mobile

banners

▪ Customized

algorithm

▪ Instant Messaging

▪ Social commerce

2. Campaigns▪ Store Grand

Opening

▪ Product launch

▪ Bundles

▪ Seasonal

campaigns

▪ Mega Events

▪ Category

campaigns

5. Marketing

Solutions ▪ Banners

▪ Email Marketing

▪ Social media posts

▪ Google Marketing

▪ PR & Influencers

▪ Affiliates network

Strictly Confidential

Join LazadaMultichannel customized brand development

1. Flagship Store▪ Dedicated brands

section

▪ Personalized

decoration

▪ Subcategories

navigation

▪ Campaign window

▪ Online promotions

Developing together your Brand on Lazada

Brand

Lazada

15

1. Link to e-Shop▪ Brand website

▪ Social Media

▪ QR code offline

3. Online marketing▪ Videos

▪ EDMs

▪ Facebook posts

▪ Brand ambassadors

live

▪ KOL posts

▪ Website redirection

Join LazadaThe new frontier of e-commerce: Social Commerce

Join LazadaThe new frontier of e-commerce: Instant Messaging

Join LazadaCost of doing business vs offline

Marketplace fees

Example

Dress

1,000 THB

Selling

…% on sales value

Payment

2% on sales value

Delivery

based on package weight

Pick up

45<3, 150/day <10

2.5%

25 THB

2%

20 THB

45 THB <1kg

44–20=25 THB

45 THB

Order/pick up

Cost of selling % on RRP11.5 %

115 THB

Marketplace Mode

Cost of Doing

Business Simulation

Thank you

Indonesia PhilippinesMalaysia ThailandSingapore Vietnam

Bangkok, June 2018