The State of eCommerce in Asia Pacific and the

Indian Opportunity

Mark Gray Managing Director, ChannelAdvisor Asia Pacific

February 27th, 2014

Agenda

ChannelAdvisor Introduction

The State of eCommerce in India

The State of eCommerce in Asia Pacific

Cross Border Trade Opportunities

Case Study

2

ChannelAdvisor - Overview

3

The ChannelAdvisor Solution

4

ChannelAdvisor - Global Footprint

ChannelAdvisor Offices

Trusted by Thousands of Top Retailers Globally

6

The State of eCommerce in India

The Players and the Marketplaces

8

Trends with India’s Online Marketplaces

9

• Localised payment methods a must,

(COD/CC/Other)

• Extended Shipping Options, (D2D/Free Delivery)

• Low Cost/Discounting expected

• Few large competitors, smaller

manufacturers/retailers are benefiting

Global CBT Considerations

India and Cross Border Trade Requirements?

Logistics?

Tax implications for retailers?

Account creation/Multiple languages

Payment/Bank requirements and Currency

Considerations?

10

How Indian Retailers can Benefit

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• Simplified payment and shipping expectations,

(PayPal/CC/AliPay)

• Higher ASP/minimal discounting/currency stability

• Manufacturers can beat channel conflict and

control their brand

• Take advantage of mature online markets

The State of eCommerce in Asia Pacific

Four major trends in 2014:1. Manufacturing/Distribution models: The growth of e-commerce will

create channel conflict for businesses currently operating under a wholesale distribution model with mono-branded stores in engagement of retail website content, (ComScore)

2. Connected Devices: Wearable computing devices, Internet streaming, smart cars and smarter phones are just some of the few ways the consumer is connected

3. Macro economic recovery and slowdowns shifting: As the EU and US continue to emerge slowly into recovery and Asia starts to see some slowdown in manufacturing both markets will continue to push Cross Boarder Trade initiatives in the online

The State of E-Commerce in Asia Pacific

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eCommerce Challenges in 2014:1. The growth of mobile: complementary to desktop web usage and is

facilitating for a customer to be online at all times. Multi-platform internet usage has led to a huge increase in digital media consumption in Asia in the past few years. Similarly, it has also led to a doubling in the

The State of E-Commerce in Asia Pacific

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Channel Explosion

Source: Public reports from eBay, Amazon, Google, Shopping.com and ChannelAdvisor estimates based on our transactional data.

We are here…

15

E-commerce 2017:

confide

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Global View

eCommerce ”Spice Routes”

Source: Public reports from eBay, Amazon, Google, Shopping.com and ChannelAdvisor estimates

based on our transactional data.

We are here…

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• Cross-border Internet commerce between Australia, Brazil, China, Germany, U.K. and U.S. will jump to $307 billion in 2018 from $105 billion last year• Traditional “spice routes” and manufacturing exporting is becoming eCommerce CBT•E-commerce has gained significant market share over recent years: In China for example: penetration in China reached ~9% of total retail sales (excluding auto and petroleum sales) in 2Q13. As comparison, e-commerce penetration in the US has reached ~10-11% of comparable retail spend

Who Owns the Market in China?

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Cross Border Trade Opportunities

Top CBT Routes

Location Number of Shoppers Shopping In

US 16.7 million UK

China 15.1 million US

US 13.2 million China

US 11.6 million Canada

UK 11.1 million US

China 10.4 million Hong Kong

China 9.4 million Japan

China 7.7 million UK

China 7.0 million Australia

US 6.8 million Hong Kong

Source: Nielson/PayPal Study from 2013 20

The Rise of Marketplaces: CBT

**11 new marketplaces in China and 2 in S. Korea in last 18 months**

Top CBT Routes

Source: Nielson/PayPal Study from 2013 22

Croc’s Multichannel Case Study

Situation:

Innovative, versatile shoe company

Looking to experiment on comparison shopping channels

Lacked the expertise and software to manage data online

Required incremental global sales from sources outside of online store

Need to control brand online across multiple regions and avoid channel conflict

Options:

Continue costly physical store growth to gain customers

Hire additional IT/Marketing resources to manage online growth

Look for channel resellers to push products online

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Croc’s Multichannel Case Study

Solution:

Propel incremental revenue in the most cost-efficient way, with as little internal management as possible!

Decided to utilise marketplaces for customer aqcuisition, incremental revenue and brand control

Launched onto multiple Comparison Shopping sites to increase traffic and keep CPC low

Decided on a Managed approach where costs could be kept low but channel expertise exploited, (using ChannelAdvisor Services)

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Croc’s Multichannel Case Study

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Croc’s Multichannel Case Study

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ChannelAdvisor – How We Can Help You

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Waves of E-Commerce

Thank You!

Questions?